Forum Replies Created
- Originally posted by Monopoly:
It can be done, even guaranteed, but the real question is not HOW, but rather, at WHAT RISK LEVEL???
Remember, a fool and his/her money will soon part ways if they gamble on chance!!!
Jo
If its guaranteed – where’s the risk – isn’t that what a guarantee is for?????
That sort of return is quite easy as a one off but to do consistantly every 10 days would be a challenge. Maybe if you made it once a month you might get a few more takers. That sort of return trading shares isn’t too hard to do consistantly every month
Westan – Yes – we have landlords insurance (although anyone that has ever made a claim on this insurance will know that you can only recover certain things ie the damage must be “malicious”. All the crap and rubbish left everywhere are my problem)
GMH454 – The tenant had secure tenancy as they had just signed a 2 year lease so there is no way a new owner could have kicked them out. We could only sell the place to an investor.
Yack – Believe it or not we actually tried listing it with the managing agents but the sales rep didnt return our calls. After 2 weeks I gave up and went elsewhere (The rental agent side of the business is good but the sales side leaves a bit to be desired!)
It’s really not the hassle and the fact that it has cost us money (some of which is covered by insurance) – its the pure cheek of it. I cant believe that the principle of a real estate agency would jepodise a sale (which he has lost) as well as his reputation for the sake of renting a house. I mean come on how much does he get for signing up a tenant (about 1-2 weeks of the rental) and then possibly 6-8% of the rent. It may total $1500 for a year. Is it worth it??
I’ve never found one to be mutually exclusive of the other. All our properties that we have bought (over a 7 year period) have been cashflow positive and all have shown substantial CG. I found this even before the latest “boom”. Why not have both??
Monopoly
I am currently selling 4 houses one of which has a 2 year lease (only 6 weeks into it) that has a 8% return on the asking price. It’s in Victoria and I think (and the agent seems to agree) that it is fair market value. It’s even advertised on the net with an 8% return so they are there if you look.
(ps – this is not meant as advertising, I kept info to a bare minimum – if the moderators think it is please feel free to delete)
Understand where you are coming from Monopoly – we have been burnt a couple of times too (once to the tune of $9000++ – oh well). You can do these things without becoming to “close to the tenants” though. We contact the rental agent at the end of the month to make sure the rents have been paid and then we post the tickets – no actual contact with the tenant at all!!
I’d have to say though, we’ve been doing this for probably about 5 years now and all the “difficulties” we had I think we would have had anyway – but in the back of my mind I think that there would have been more “difficulties” if we hadn’t done it. Does that make sense??
We own 4 houses and we send each tenant (who is up to date with payments) 2 passes to the local cinema each month. I was actually wondering only the other day if it was worth it when my younger brother called to tell me that he had met one of our tenants at a party. Without letting on that he was related to me he asked about the house she lived in etc. She told him that she was actually going to move to a larger house but was delaying it as long as possible because she had these great landlords that kept sending her movie tickets if she paid the rent on time. My brother asked how long had she been intending on moving for. The reply – 18 months now!! I’d say that the extra $240 per year had been covered.
In response to Monopoly (I know you didnt ask me but I’ll respond anyway) we put toilet paper, nice smelly things around the house, bunch of flowers and a basket (varies in size depending on if 2 br house or 5 br house) with all the “first night essentials” (tea, coffee, cups, milk, sugar, tissues, chocolate etc etc etc) in each house every time a new tenant rents one of our houses. It also includes a welcome note with all the nice to know things in it (garbage night, utility phone numbers, council services, movie times – the list grows every time we do it). We have had such positive responses to this and it’s great to have tenants start off on a positive foot. Makes them feel like the place is their home and they are welcome – they’re not just a money source for you!
I think sometimes we keep tenants so much at “arms length” that we miss the chance to provide that good customer service thing that we all complain doesn’t exist any longer. Remember we are all running small businesses whether we own 1 house or 130!!!
Flight Instructor – used to teach aerobatics and formation flying – now teach people to fly big stuff for major airline. Not as glamorous as it sounds – spend more time in a simulator than I do out in the real world!!!
Hi Yack
Yeah – I actually did use them and found they were worth about what they charge – nothing!! After submitting all the paper work I heard nothing much until I contacted them after 2 weeks. They said that they had sent out letters. When I went to confirm with them where the letters had been sent they hadn’t got any addresses in the system so I gave them again. Another 2 weeks and I called them only to be told that they had “sent letters”. I asked where they had sent them to and they looked it up on the computer only to realize that there wasn’t any address details and could I give them to them again over the phone. This went on like this with subtle varitions on the theme for about 3 and a half months before I gave up. They would very rarely contact me and when I talked to them – they would ask me for information that had been submitted earlier both in writing and verbally.
Westan
Morwell right now I would say is in the transition between topping out and declining. More and more houses are appearing on the market but sellers are still expecting top dollar (a few are still getting it which encourages the rest – but it is slowing). Cheaper houses (ie those under $100k) are selling quickly (you see maybe 2 per month) but anything above that magic figure is taking a while. I’ve seen houses in the area on the market for months now where as 6-12 months ago a house would generally only be on the market for a period of a few days to a few weeks.
Rental wise the market has well and truely topped. There is a flood of houses and not too many tenants. Believe it or not the most popular rental at the moment is the 2br unit which is unheard of down here. We’ve had a 4br and bungalow house on the rental market for almost 5 weeks now. The longest this house has been empty previously (over the last 4 years) was 2 weeks and that was because it needed a good clean up and I wouldn’t let the rental agent in until is was completed.
Don’t know if I answered your question clearly enough or if I’m too generic. If you need anything more specific just drop me an email. pepptalk at yahoo.com or PM me
We recently finished sanding the floors in a 4 bedroom house (it was huuuuggggeee). The quote for a professional come in at just a touch over $5000. We did it ourselves for about $600 and it looks sensational. We asked around a few places for advice and found a really good place (Paintright – they supply the stains and vanish for the professional guys). The equipment they leased and everything was excellent quality and they knew what they were talking about (unlike my experience with places like Bunnings where the guy maybe a 16 year old part timer who really knows nothing) It took about 3 weekends to sand, clean and coat (4 coats) everything.
The big tip given to me was vacuum clean lots and before you start putting on the vanish – make sure you get a woman to clean the place cos guys just have no idea how to clean properly!!!! He was right – I cleaned the place and then my wife did it properly!
Unless you have indications showing potential problems – why upset your cashflow right from the start? With tenants I usually assume innocent until proven guilty. Having said that we have bought a place where you could tell the tenant was trouble (ie the real estate agent wouldn’t go into the house because of the smell of dirty nappies stuck to the walls – and no I’m not joking!!!) and we had her evicted as part of the purchase agreement.
Melbear
You know – it’s funny – I was in a meeting with senior management when the announcement was made about the name and within 30 seconds it had been changed to(“christened”???) pornstar and it seems to have stuck – maybe we should have passed it on to marketing.
In regards to it becoming the “domestic” operation this rumour has been going around for a while – prommulgated by the unions!! I don’t know – I work with a number of guys who have been involved in the planning/running of low cost airlines in Europe and they seem to think that we can run both. There will always be people who just want the bare bones and others who would rather pay a bit extra for the convenience/service etc. Having said that I think the future growth (domestically) of Qantas will be thru Jetstar and yes – I would say that some jobs are in danger no matter what management is currently saying. But I also think that it wont be mass sackings or anything – more like natural attrition. But having working in aviation since turning 16 the one thing I have learnt is that tommorow the whole world will change. It wouldn’t be the first time I’ve turned up to work to find the company I worked for yesterday had simply disappeared, never to be heard of again. Not saying Qantas is going to do that but it only takes another Sep 11 type thing and who knows!!!
Kendell tried to operate out of Avalon for quite a while and couldn’t manage to fill a Beech 1900. Not sure how much luck Jetstar will have filling an A320. Sure you will get people from Geelong and the coast but how many people will travel to Avalon to catch a flight from the rest of Melbourne/Victoria? The big advantage I see at the moment is free parking – but will that last? The other thing is it is possibly a political thing with the unions as Qantas/Jetstar management have assured Qantas workers that Jetstar wont compete with the mainline (Qantas) trunk routes (ie Syd-Mel). Now they can offer Avalon-Syd. Dont know but it will be interesting to see further announcements today and in the near future.
PS. I should add that I actually work for Qantas in the flying section.
Westan
$74000 and it is rented for $160 pw (4br – Owner in hurry to sell – we offered 30 day settle so he dropped his price – funny thing is we actually bid on this house almost 5 years ago and were the loosing bidder at $23500 – I didnt quite understand what I was doing back then – not sure I do now sometimes!!!). As I said not as good as we used to get but it joins one of our other properties and I guess some time in the future we are hoping to join the properties together and develop them in some way.Westan
I had to laugh when I read on a previous post that your wife wouldn’t let you buy in that town. My wife still will not let me even read a page in a real estate section that is from that town. She’s been that way since we started investing in 1997 and prices then were a little(!!!) cheaper than they are now.If your in Victoria get a copy of the new guide from Consumer Affairs. In there it tells you what your after. There’s also been some discussion on this in a previous thread if you do a search.
Westan – I’m surprised at your comment – We just (2 weeks ago) bought a house in a town that is near the town where your wife wouldn’t let you buy in. It returns 11.25%. Not as good as it was a few years back but the house backs onto one of our other houses and we think we may be able to develop at a late date.
Felicity
If you get a copy of the new regulations for real estate agents from consumer affairs in Victoria it quite clearly specifies that agents MUST present any and all offers that are made to the vendors. I posted the contact details in the Heads Up forum about 2 weeks ago. Its a free document, pretty easy to read and unbiased.
ginamarree
We did the exact thing that you are considering a few years back and I would say it worked well. However, having said that let me add this. If you are the type of owner that is going to worry constantly about the way the property is being maintained (and I mean more than the usual interest you need to show for any property) while you are not there I would suggest it may not be for you. As mortgage hunter said, there are horror stories, but usually it’s miscommunication. But understand, the tenants are not going to look after the place in the same way as the owner would. From personal experience, tenants dont mind if their dog occaisonally runs through the house scratching the new polished floor boards, so what if the couch scratches the paint and dents the wall when its slid accross the room to make way for the party/kids/any other reason. You need to be able to emotionally detach yourself from the property and treat it as a rental and not as “our first house, with the room that we renovated for the new baby” or whatever emotional tie that we have attached ourselves with.
By the way our first two tenants we had looked after the place really well but the third – well, 13 dogs being kept (unknown to us until the neighbor complained about the noise) in the 2nd bedroom (yep you guessed – that was our emotional tie – the room we had renovated for our first baby) caused a bit of grief. But that was sorted quickly and the next tenant has been really good. Overall I would say we are glad we rented the house out and bought elsewhere.
We have 3 houses that have varying amounts of asbestos in them. Asbestos is fine as long as its not disturbed (eg strinpping paint away, breaking boards etc). There are also different types of asbestos. The one you really need to look out for (in housing anyway)is the one that has golf ball pimples on the back side of the sheet (does that make sense???). A lot of local councils put out pamplets on asbestos and its handling if you enquire. I know the latrobe city council does because I have theirs in front of me (Latrobe valley is basically built out of asbestos – power stations etc). It’s actually produced by a second party (not the council) but is distributed by them.
