The AV Jennings release is particularly interesting. I often see the media accusing developers of land banking. It is the first time I have seen them defining this as a strategy. There is definitely something wrong with the model when a business strategy is based on having 5 YEARS of inventory!!!

In any other business in any industry, having a…[Read more]

It can still be done, just not in Australia, try USA.

Just looking at Genworth’s financial position and exposure.

In 2008 their share price dropped from ~$35 to $1.12 due to their exposure to the US housing market. The scary thing is their exposure to the Australian market is far larger and any significant drop here would almost certainly cause insolvency.

Of their 3.8 million LMI policies…[Read more]

The whole purpose of LMI is to protect the banks. They are covered for the first 20% of any losses by the insurer. In NABs case this is Genworth Financial. It isn’t a bank decision, but the LMI provider. They need to keep receiving premiums to stay afloat and cover their costs, so they keep offering insurance.

It raises an interesting point…[Read more]

Here is an article in which the chief economist at BNZ, fully owned by NAB advise that they recognised the NZ market was 30% overvalued in 2008 when the ratio of house price to wages were at a multiple of 6 in NZ.In Australia they are much higher now, Sydney has a multiple of 9 and Melbourne 8. You have to wonder what NAB's economists are …[Read more]

How many square metres are you willing to accept for that price?

My research to date has put Texas cities at the top of the list, San Antonio and Houston. Both large cities with inexpensive real estate. They didn’t go through the boom bust cycle anywhere near as much in Texas and has always been good value. For the size of the cities, their median prices are fantastic.

The typical complaint is actually that bank valuers undervalue properties, so that you need to put more of your own money in as deposit. I was advised by the builder on one of my houses not to go with one lender as their valuer in the area always undervalues, by like $50k on a $350k purchase.On my last house that I purchased however, the bank…[Read more]

I asked the same question in another forum, this was the response I received

Quote:
Originally Posted by mattnz
Just wondering if any locals can advise why Gladstone seems to be the only town in the region that didn’t flood. Does Gladstone ever flood?

Gladstone does flood and the closest it came with this past rain was the area of Boyne…[Read more]

Westpac’s economics team is expecting interest rates to increase. All RBA cares about is inflation targeting and the floods will cause produce prices to increase significantly, creating inflationary pressures.

I am about to increase the rent on my place from $360 to $420 per week. Fortunately I have a corporate tenant and it is fully furnished with everything they could need. There are very few fully furnished properties in Gladstone and strong demand.

If rents are going to eventually go sky high, then you need to keep up with the market. No point…[Read more]

Try finding him or his gf on facebook, I have found it is the easiest way to track people down. At least the bill is in his name, not yours.

Surprising to hear that the news coverage is actually less dramatic than the reality, its normally the other way around.

And compare it with this list of the cheapest cities to buy in. http://www.statjump.com/lists/house-value-dp4c112tc.htmlIf you can find cities that have low vacancy rates and low prices, it could be a winner.

It seems that St George are now viewing rent payments as "savings" towards LVR calculations. It may be worth discussing with them, as you may find that the improved LVR means no LMI.http://www.debtdeflation.com/blogs/2010/12/23/loan-standards-drop-to-keep-the-bubble-afloat/

kong71286 wrote:
A big thanks to all those that have contributed to this thread and shared their experiences so that we can all learn from another Being in my early 20s and having only commenced work this year after graduating from university, I have limited experiences in investing, and haven't made many mistakes yetI'd say my biggest mistake…[Read more]

If it is in a new estate, there are probably additional covenants that the initial estate developers imposed that would prevent further subdivision. Have a look at your purchase contract.

Sorry I should have added, Steve McKnight the owner of this site also does developments these days.

Both Massland and Carly Crutchfield are always on the lookout for deals.They tend to heavily favour their own interests and profit, but at least you should walk away with a small profit rather than a loss.

I think the advice to look at US property is a good one. At your age as a long term investment, some of the rental returns are great for cashflow and who knows what a US$30k property could be worth in the future.

It is very hard to save enough money in Australia to purchase property,especially with stamp duty and the value just isn’t there like…[Read more]