Having been through the struggle to buy my first home, I agree by saying that it is getting tougher for the average person to buy a home. The property market has simply exploded out of control and while that is good for some, it is very hard on others.

Regardless of the amount of talk on how long the boom will go for, buyers can only buy what…[Read more]

Hi Drewboy,

If it were me and I had the cash or equity available, I would choose a commercial property. In your example you are netting $12,000 PA from the commercial property. If you were to spend hours looking on the net and talking to agents in regional centres trying to find 10% yielding residential properties, you would need to find multiple…[Read more]

Hi Guys,

After reading this thread with interest I decided it was time to give my point of view. After Youngie posted his information and asked for some advice, I was very surprised at the amoumt of people that immediately said “NO, don’t do it….buy something positive cashflow”.

People simply put a negative spin on it without knowing all the…[Read more]

Hi Michael,

I looked at the links you provided however they had no information about the current topic. Are we talking about adding a new room or some other major works, or a simple kitchen renovation as being classed OB and requiring insurance?

I have been involved in a few deals where simple works were done before the property was resold and…[Read more]

Hi Joff,

I seem to recall a website where you can apply for them or simply get some info. I believe the site was http://www.depositpower.com.au but I could be mistaken.

Cheers,

Mathew.

Hi,

How does anyone know that the boom will continue? All you can do is look at the current economic climate, which is still looking very positive, look at the growth trend in the area and take each deal on its own merits.

My personal strategy is based on buying smart and reselling for a profit. That could mean buying on a long settlement, doing…[Read more]

Hi Whj,

Thanks for clearing that up, you had me worried for a minute there []

Cheers,

Mathew

quote:
In NSW you can not use “and/or nominee”, so the name you put on the Contract for Sale can not be changed.

So if you purchase the IP in the companies name you can not add the words “as trustee for …..” after the company, it cannot be owned within the trust structure.

Hi Whj,

If you can’t buy a property “abc company as trustee for xyz…[Read more]

Good work Neo…you have just proved yourself to be better than the average investor who would have simply put in the higher offer and paid more than they should have. Well done.

Cheers,

Mathew.

Do you think if we all sent them an email with the correct definition of positive gearing, they might realise what tossers they are. []

Cheers,

Mathew.

I am currently refinancing my PPOR to get access to the equity to use to invest with. My broker has suggested the following arrangement:

1. Refinance to 90% of valuation figure of $405k.
2. Create a separate interest only loan for the amount of $67.5k which is the equity I will have access to.
3. Fully draw the new loan as an investment loan and…[Read more]

quote:
Basically, if you can prove that you are in the business of trading properties and class the properties as ‘trading stock’ then yes no CGT would be payable as the houses would be classed similar to any item such as a toothbrush at a supermarket.

Unfortunately, it ain’t that simple because you must pay GST on the properties, get taxed on…

[Read more]

Hi Terry,

Fair comment, I was having a bad day when I made that post so I appologise if it was a little sarcastic.

I was referring to the instalment contract and not the L/O as I personally don’t think of them both as wraps. To me a wrap is a property that is sold wheras a L/O is simply rented with the option to buy.

I have been told by…[Read more]

quote:
Hi Mathew,

I am trying to understand why someone would hand over control of their property to me as part of my sandwich trade given they will only receive maybe 1K straight up from me as my option premium and not receive any benefit from the property for a couple of years until the trade is exercised. [xx(]

No offence Polaris, but did…[Read more]

That is why I said WRAP Terry, not L/O…there is a difference which I am sure you are aware of.

Mathew.

I was under the impression you could assign to anyone by doing the and/or nominee as long as you paid the stamp duty on the purchase you intended to make. Can anyone comment?

Cheers,

Mathew.

Hi Polaris,

I personally wouldn’t do a lease/option for 5 years. I would do it for 2 years with say 3 option renewals giving a total of 6 years, but the price and rent is changed with each renewal and a new fee is paid. This way I would guarantee myself of good returns.

When you say “make no cashflow out of the property other than my premium”, I…[Read more]

Hi,

When it comes to valuers, it is up to YOU to sell the property to them by using any information you can. This may be in the form of comparible sales, historical growth, anything happening in the area that would increase growth and even in the form of current land prices and building costs.

I recently had my western sydney property revalued…[Read more]

Hi Polaris,

It is illegal to do a wrap on an I/O loan so that will have to be changed to P&I unless you buy the IP without telling the bank what you plan to do.

However this can come back to bit you on the butt and most people recommend full disclosure to the banks about your intentions.

Cheers,

Mathew.

Hi Westan,

I do agree that $50,000 would be better put to use in your own property as you will get a better return if you do the right research and buy wisely. If you don’t have the knowledge to purchase wisely and create a good deal, you may be better investing in a fund with a 12% return as is will be better than losing 20% per year because of…[Read more]