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MTR
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@marisa
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October 30, 2016 - 4:59 pm
I would also consider Melbournes western suburbs, they have already moved like most of Melb but they are still good value. Melb is number 1 for immigration and service based industries growing. Broadmeadows only 15 km from cbd, look for development sites with potential, build at rear and manufacture cash flow
Marusa
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MTR
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@marisa
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October 30, 2016 - 4:32 pm
Ok, this is an older thread September 2015.
Let me qualify I am from Perth so I have on ground knowledge of what is happening in this market. Its a falling market and has continued to fall from late 2014, I would never ever recommend any investor buy in a falling market this is the easiest way to lose money because we have no idea how low it will go. What you perceive as a bargain today could be the opposite tomorrow.
The problem as I see it in Perth today October 2016 is we are suffering because of huge job losses, our economy is down the gurgler, until business confidence picks up we wont see growth in this market.
If you are buying a primary residence then this is a different story, blue chip has still not come back from the crash in 2007 but there are certainly great buys $1M++.
Happy investing
Marisa
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MTR
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@marisa
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Post Count: 663
October 30, 2016 - 4:23 pm
Perhaps we should mention the Detroit market as number 11….. ouch
Marisa
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MTR
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@marisa
Join Date: 2004
Post Count: 663
October 30, 2016 - 4:18 pm
I am a huge fan of timing the markets too, perhaps a little on the conservative side, but I only buy when markets are rising or booming and bail prior to peak.
OK, I don’t have a crystal ball and you wont time it perfectly, but you don’t need to, most property cycles last for 3 years the point is get in when it starts rising and buy as many as you can and once you have made 40%+ get out, don’t be too greedy and move on to the next cycle. Its certainly worked for me, easiest way to make money.
Marisa
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MTR
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@marisa
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Post Count: 663
October 30, 2016 - 4:06 pm
How long is a piece of string? seriously Melb is a tough gig at the moment its taking sometimes 12 months to get approvals.
Start with finding suitable areas that stack up where you will make a profit. At this stage of the cycle it will be hard because land values have risen so much, the last of your worries is Council. Once you find a suitable site then work it, DA approval are never a guarantee regardless of area. I would also employ a gun town planner, they will be a wealth of information and have a good idea on various councils.
All the Best
Marisa
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MTR
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@marisa
Join Date: 2004
Post Count: 663
October 30, 2016 - 3:59 pm
Me too, I follow the same philosophy, am I mean……….
MTR
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@marisa
Join Date: 2004
Post Count: 663
October 30, 2016 - 3:56 pm
Hi Paperchaser
I just completed and sold 4 townhouses in Melb and in the process of commencing another 3 townhouses in Melb.
I am on to my 5th project.
I use an architect who drew up the plans for the site, I also had a gun town planner, the total cost came in at round $20,000.
Architect basically lodged the drawings etc with council and then discussions begin. Sometimes you get lucky and it will take 6 months, but Melb is a tough gig at the moment my recent project took over 12 months to get plans and permits approved.
Once this has been completed then its work in drawings which my architect completed for additional fee of around $7000. Once soil and engineering report is completed around $4000 then you get your building quotes and get many because these can vary greatly, especially when a market is very hot, builders pump up their building costs.
As far as lenders go I have been using RAMS lo doc, residential loan they go up to 4 units, brilliant, cheap and my accountant signs off on my income. I buy in a Trust because this is what my accountant recommended and it save me tax at the end.
Please feel free to ask any further questions, happy to help.
Marisa
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MTR
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@marisa
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Post Count: 663
October 30, 2016 - 3:47 pm
What I would be doing is finding out what is in demand in this area? In other words what is achieving higher growth.
Can you share the area/suburb?
Also, look at houses in this area where you can possibly add value by renovating or if the land can be subdivided where down the road you can cut it up and on sell. This requires considerable homework but the re agents in the area will have the answers.
I am a developer so I would always look at land which can be subdivided as this is a very lucrative strategy to make money in the future.
All the best.
Marisa
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- This reply was modified 8 years ago by MTR.
MTR
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@marisa
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October 30, 2016 - 3:43 pm
Ethan
I think you can have 2 families in the property, however they must be on one lease if its not legally approved granny flat.
Also can be an issue with insurance.
I really don’t like this set up at all, its harder to rent these out, so what may appear as cash flow on paper becomes a negatively geared property.
I had a dual occ property in QLD and sold it after 12 months, as the above happened, yet in Sydney there are many illegal g/flats in particular western Suburbs, I owned one and always rented out and no issues. Unfortunately different demographics in QLD, lesson learnt wont go down this road again in QLD…. enough of a rant now:)
Marisa
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MTR
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@marisa
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October 30, 2016 - 3:36 pm
Mickey
reading books, courses etc. may be helpful but at the end of the day its action that will make it happen.
I started property investing in 2001 and 4 yours ago started property developing and am now onto my 5th successful project, its all about learning and networking.
Its important to know how much you can borrow for starters. Its also equally important to understand property cycles and the easiest way to make money is to buy in rising markets. We have just seen property markets booming in Sydney and Melbourne, if you purchased in these States you could have easily doubled your money as they have been booming since 2013. The good news is its not too late……
There are many ways to make money but you need to crawl before you walk, you are on the right track keep learning and key is networking with people who are successful investors. What State are you in??? It would be good to meet up with an investment group in your State, I may be able to help you with this one?
Marisa:)
MTR
MTR
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@marisa
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October 30, 2016 - 3:20 pm
Hi DavidR
Its a tough gig at the moment because we have seen the Sydney market booming since 2013 and many investors have doubled their money, my guess is buying now is possibly too close to the peak, just my opinion, smart investors have already taken money off the table or accessed equity and moving into different markets.
1% rule wont cut it in Sydney, due to massive growth in this market you may be looking at around 3% rental return, very poor. On a positive note interest rates in Australia are at historical lows.
What is the answer? Either your sister looks at other markets around Australia that may be at a different point in the cycle ie Brisbane or sit and wait, or better still buy in USA, Charlotte is hot hot hot?? Could you help your sister purchased something in this market? There are many markets in US that will continue to grow. I have been playing in the Atlanta market since 2011 as well as Sydney and Melbourne and from my personal experience superior growth and cash flow has been achieved in Atlanta.
MTR:)
MTR
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@marisa
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October 30, 2016 - 3:01 pm
Hi Bernie
I am from Perth playing in Atlanta market great cash flow, also developing in Melb in Croydon, coincidence:)
MTR
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@marisa
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October 30, 2016 - 2:55 pm
Sounds good Nigel
USA is very much about networking with the right people no different to Australia IMO. Many have the illusion that property investors always make money, not so I know many that have lost money in Australia.
My gut tells me the Australian property market is due for a correction. I have taken my profits off the table and US is providing another avenue to grow wealth
I will post some of my deals in the new year
MTR:)
- This reply was modified 8 years ago by MTR.
MTR
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@marisa
Join Date: 2004
Post Count: 663
October 29, 2016 - 3:21 pm
RAMS Lo doc good product
MTR
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@marisa
Join Date: 2004
Post Count: 663
October 29, 2016 - 11:54 am
Just an update from my original post –
We are back playing in Atlanta love this market, but our deals are a totally different beast from what we were doing in 2011/2012.
As we know property has soared in Atlanta and continued to grow and the yields no longer fit my criteria, have not for some time.
Where from here, a number of strategies we are currently using –
We Purchased 5 developments sites in hip pockets that are gentrifying we are not playing in the burbs. We will start building 10 townhouses in January/Feb 2017. We have a team and we also have a US business partner. Interesting in US a average size development is around 100 units, so we do not fit this category too small for a developer and too large for mum and dad investors. The key is to build what people want and also to find the sweet spot in terms of targeting the right price point.
I am a developer is Australia so I hope some of my experience will help me with my Atlanta developments. The interesting thing about developing in US is it is much shorter time frame than in Australia, we expect 6 months per projects, in Australia we could be looking at 18 months, ROI is huge.
We are also flipping properties in US and yes, there are good deals but you wont find them without the right contacts, and I would not touch anything unless there is 40% in it for starters.
We are looking for our second flip and the idea is to flip at least 10 per year, 20 would be nice, but I think a tad ambitious.
Happy investing guys.
Off to Atlanta in November will be flowing over regularly.
MTR:)
MTR
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@marisa
Join Date: 2004
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July 21, 2016 - 6:40 pm
Hi TerryP
Amazing markets to play in and strategies we can not use in Australia due to population. There are many hot markets and it still comes down to who you know and who you network with. Still very easy to get burnt unless you understand the product, and the slippage.
Been investing in US since 2011/12 and have 9 properties large Single family homes (SFH) which have been renovated and been renting these out. These have now tripled in value and provide over 25% gross yields.
I am now currently playing in 3 markets in US using a couple of strategies, and loading up on properties as I only see upside.
We are also looking at developing as US, it is now in first building stage of the cycle, I am a developer so this one is up my alley, am also based in Perth but been developing in the Melb market.
MTR:)
- This reply was modified 8 years, 4 months ago by MTR.
MTR
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@marisa
Join Date: 2004
Post Count: 663
February 27, 2016 - 12:44 pm
When we were buying in US/Atlanta we were buying what I would consider B grade properties in 2011/12, South Atlanta as this pocket provided the higher cash flow.
The criteria was to buy larger homes that generated over 20% gross yields.
I can tell you that on average each year after expenses these properties generate 10% net yields, confirmed by my US accountant, so there is significant slippage.
I still hold 9 properties in Atlanta and we have achieved significant growth, we were buying at between $35,000-50,000 (foreclosures) no mark ups on the properties, we just had them renovated to be rented. These properties now retail around $120,000-150,000 in current Atlanta market. We were buying at $18-20 sq ft, I believe it costs around $70-90 sq ft to build today.
We had some teething problems initially with tenants and property management. This seems to be going very well now and I wont be selling these as the income is excellent with the weak Au$. I agree property management is key, but I would also expect that it is important to buy decent properties.
What we are now seeing in Atlanta is the rents are starting to rise significantly and very high demand and county taxes are also rising because of the increase in the value of the properties.
My experience overall has been great, but I do understand why many got burnt due to the sharks operating and ripping people off.
We still have not been able to source suitable finance in US, there is hard money lenders but rates are way too high.
If anyone has worked this one out please let me know.
MTR
MTR
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@marisa
Join Date: 2004
Post Count: 663
November 11, 2015 - 4:10 pm
I wish you had a property with development potential, as you don’t voted no. 3
MTR
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@marisa
Join Date: 2004
Post Count: 663
November 11, 2015 - 4:06 pm
Timing is everything, making money in property is all about supply vs demand.
MTR
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@marisa
Join Date: 2004
Post Count: 663
November 11, 2015 - 11:59 am
No one can predict the future, however historically Au$ has been around 70-72, the days when it hit 1.00-1.10 was certainly rare, due to a booming economy and mining.
I did not invest in Steve’s fund purely because I like control, this product does not give me control and that is the risk that investors take, you can not cash in at any given time. Good luck to everyone who has made money to date, I wish you well
I instead purchase 9 USA properties when the Au$ was around 1.09, where my houses have tripled in value and 20% gross rental income.
All to their own. The fund is obviously working well, let hope the Au$ remains low.
MTR:)