If anyone seriously thinks that it would be a good thing if the bottom fell out of the housing market then you need to get your head checked. It happened in the USA and look what the result was- massive job losses and unemployment in excess of 10%. If you think that that scenario is better than what Australia is got at the moment then I am sorry but I just don't understand.

Maybe you just want house prices to crash so you can have a laugh at other peoples pain. I am 25 and graduated from university 2 years ago and am about to sign contracts for my second IP (in Sydney). I agree house prices are expensive in Australia at the moment, but there are things I am doing to minimise that exposure (like investing in CF+ve USA real estate). And I also think that if you want to own property then it is definitely possible, however sacfrifices are needed.

I personally dont think prices will crash. Unemployment is near all time lows, Australia's economy is the strongest it has ever been with tens of billions of resources projects in the pipeline which will have direct flow on effects to other parts of the economy and experiencing wage and inflationary pressures. I dont think housing will rise at in excess of 8% per year like it has in the past, but I can see quality real estate in quality locations will rising by a historically moderate 5% per year. In the absence of a trigger, a crash just isnt going to happen IMO.

Cheers,
Luke

Hi,

I have a few comments to make about your ideas

a. This sounds good and should be easy. Do some research on your target market- if the units around your area typically sell to investors, then this might even be a win for them as it will likely be negatively geared. So they get to secure the property at the price that suits, but delay the cash loss on the property. If however owner occupiers are likely to buy your house, then this might not be very attractive. Remember it is a buyers market in most parts of Australia at the moment.

b. This is probably not ideal for the buyer. If they are an investor, they would probably want to get a tenant on a lease into the property for security. And if they are owner occupiers, then they would obviously like to live there. But then again, if the rent you are offering is attractive then they would probably be pretty happy.

c. You shouldnt have to pay extra. It is a buyers market at the moment so you should be able to negotiate a longer settlememnt as they are probably taking a while to sell their property (unless of course you get a ripper deal- then you might have to just buy the place on a short settlement to secure it).

d. An LOC secured against your current PPOR could work. You might also be able to capitalise the interest as you could argue you need to do thi sin order to hole the property untill you sell (to show it is not a tax avoidance strategy). However this is costly and depends on your servicability as to whether you could do it.

e. Depends if you dont mind moving, but this could be a sensible option. Bear in mind that this would probably result in having longer vacancys at your IP.

f. This is pretty similar to e. really

g. You might have difficulty getting a vendor to accept this clause as it is unlikely you would be able to arrange settlement dates so close to each other (you would need to be lucky with selling!!!!)

h. I cant think of anything else!!!

Hope this helps, I was just jotting down a few thoughts that came into my head.

Cheers,
Luke

And I forgot to add- I don't think that these campaigns will not effect the property market at all.

Luke.

Why not consider putting down a 10% deposit? You have the deposit as your gift, and can you still get a $7k FHOG or has that expired?

Cheers,
Luke

Hi Rick- Just wondering who you were going through to get finance for your USA properties? I would expect to pay approx 5-8% interest so am struggling to see how you wouldn't be better off financing 3 properties with a 15-20% net return compared to paying cash for one?

Interested to see how you went about getting finance, who through, and what hurdles you hit.

Cheers,
Luke.

And I forgot to add- if your tenant falls down your non BCA compliant stairs and injures themselves and sues you, your insurance would probably not cover the liability so you would may up for a few million dollars in compensation. I would definitely go with a compliant stair however I can not for the life of me justify a builder charging double just to add a landing.

Luke

Get a copy of the BCA and research yourself. Or ask the people who are quoting for a BCA compliant stair what makes it compliant. I think I can shoot you a copy of the BCA if you pm me.

Good point Richard, I didn't pick up that the loan was CBA.

Agree Euro, good post.

Nice link Dan. It actually says refrigerator in the list of items that need to be depreciated over a number of years!!