Forum Replies Created
Donna
All our residntial proeprty insurances are with CGU – our insurance broker suggests that they offer the best cover.
I am impressed with the new policy that AAMI are offering. It seems to cover building insurance PLUS landlords insurance which you normally take out separately. I will invetsigate it when my other insurances fall due.
Michael Yardney
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FREE subscription http://www.metropole.com.auARchitects fees are not an area to skimp on.
I’m sure you’ve driven past lots of new properties that are drab and boring.
You would have also seen some properties that catch you eye and are appealing.
A good architect can add much more value to yor project than what he costs.
The fact that you fell good with the architect is important. trust your gut feelings.
Michael Yardney
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Property development is an exciting industry with lots of opportunities. There is of course no school of property development so people come into it from all backgrounds.
Our property devlopment company http://www.metropoleprojects.com.au employs 9 people directly but many of our functions are outsourced as happend with most small developers. We use outside architects, surveyors, town planners, etc.
What would I look for in a new employee? It depends upon what role I am looking to fill.
The first thing I look for is experience – someone who has done it before. Sorry this may not be what you want to hear, but we don’t have the time to train people.
I have 2 sons aged 17 and 15 and suggested that if they wanted to come into the business they would first need to get some qualification. It could be anything that adds to teh business such as architecture, accounting, law, building, town planning or surveying.
To be a good developer you need to be an entrepeneur and have a great amount of self confidence.
Michael Yardney
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FREE subscription http://www.metropole.com.auOriginally posted by Dr.$:Can any body advise what is required to get a block of units on one title (Vic) to be strata titled. Cost, timing and requirments etc..
xxx
Your first port of call should be a land surveyor who will prepare a plan of subdivion and submit it to council.
The cost and timing depends upon whether the block complies with the current town planning requirements for separate titles and if any work needs to be done to achieve this.
You surveyor should be able to give you some preliminary advice on this.
You will also have to pay leagal fees for lodging of the new titles with the titles office.
Michael Yardney
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FREE subscription http://www.metropole.com.auIts a great strategy looking for highly motiveated vendors, but you will probably find better bargains amongst;-
1. People who bought off the plan a few years ago and now have difficulty settling.
2. People who bought at the peak of the amrket and are now quitting their investments.
3. Highly motivated vendors of established properties.There are not too many developers around Melbourne who are hurting at present, and while there are some organisations around saying they will help you buy wholesale off these developers, they are usually just marketing organisations who make substantial profits.
Michael Yardney
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FREE subscription http://www.metropole.com.auDO you have a trade background? Would you be doing the renos yourselves or would you employ others?
Michael Yardney
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FREE subscription http://www.metropole.com.auOriginally posted by tljw1:Hello everyone, Thomas Wilson here. Currently I am getting a proposal together for a property joint venture. This is the first proposal I have done. I am currently getting information together about medium house prices for the last 15 years. I have noticed many sources are available such as REIA,RESIDEX and ABS. Just wondering who people would recommend for such information? is one better then the other? does all there information come from the same place? Any information or help you could give me would be great.[biggrin]
No, surprisingly all the data is not the same. You will get different median prices from each of the providers you mention. It has to do with the data they sample and the timeframes for collecting the data.
I believe Residex’s method is the most accurate being a statistical model, as it does not only rely on sales data. You see some unusual sales, or a new development of different type and price of dwelling can scew the figures from other providers.
Having said that if you are proviving information for a proposal for others, it would make sense to stick to the industry standard – the REIA – their data is not expensive.
Michael Yardney
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FREE subscription http://www.metropole.com.auAs a new investor you will learn a lot by reading some of the current and many of the old posts on this forum.
Then forget what you learned about in shares because investing in property is VERY DIFFERENT.
Many share investors try to make money trading – this doesn’t work well in property.
As a beginning property investor you need to work out what you are trying to achieve. What are you after? Capital gains or cashflow?
Avoid off the plan – it’s the wrong time in the cycle for this, as success in this strategy depends on buying well below market price and strong capital growth.
Learn all you can, read some good books, choose a team of advisors (but be careful who you listen to).
You will find some interesting reading for beginning investors on one of our web sites under investors learning centre at http://www.buyingmelbourne.com.au
Good luck with your journey
Michael Yardney
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FREE subscription http://www.metropole.com.auOriginally posted by lifeX:Michael,
I know you are a reasonable person and have much experience with Real Estate over the years and would like to agree with you that Trusts are still go in Vic. As I have just set up a trust for purchasing property myself. I don’t have a total land component above $900,000 yet myself and I doubt many investors would.But are you telling me that you still recommend Trusts, even if these changes go through? [blink]
Live, Learn and Grow
Lifexperience
Thanks for the kind words.
Would I recommend trusts?I am not licensed to recommend anything[biggrin] so no I wouldn’t
Would I still invest in trusts? Yes I would and I have. I have set up 2 new trusts in the last few months for new property purchases.
Do I like the new rules. NO WAY. not when I have a number of trusts. But it won’t stop me investing and using the most appropriate structure to own my properties.
I understand your point, it is very hard for a beginning investor, or someone with one or 2 investment properties to justify setting up and maintaining a trust.
But I suggest you begin with the end in mind. What will your proeprty portfolio look like in 5, 10, 15 years time?
When you buy your home it makes sense to put it in your own name, but when you buy an investment you must consider 4 taxes:
1. Stamp duty
2. Income Tax
3. Land Tax
4. Capital Gains taxand you should also consider asset protection.
If you are going to make a business out of property and build a sizeable portfolio, set up the structures to accomodate all of the above for the future. It is too expensive to change later.
Cuurently the “smart” accountants I speak with are still recommending using a trust structure for many (not all) of their clients.
Michael Yardney
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FREE subscription http://www.metropole.com.auI don’t have a HIA contract with me at home so I can’t answer about the specific clauses, but will check tommorrow.
But in general….
There is a clause in the standard HIA contract that says that if the you delay the commencement of construction, then there is an escalation in price. Effectively you delayed commencement by not handing over the land in time. I know it wasn’t your fault but building costs are going up about at about 5% per annum and the builder hasa a right to charge more.
See what is specified in your contract becuase 9% increase for your delay seems a bit stiff.
I believe the builder must notify you of his intention to charge this increase in a timely manner – it will be specified in the details of the contract. It is incorrect to do this at the end of teh contract. Check you position with the HIA.
As for charging a markup (12%) plus GST on variations – this is fair and normal practice. We try and get builders to charge a 10% mark up (profit margin) but I know many would charge 20%.
You should request a certificate from the builder that he has given you his final claim so there are no more surprises.
Michael Yardney
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FREE subscription http://www.metropole.com.auThere are lots of reasons for putting properties in a trust including asset protection and income splitting, so it not really as simple as you make out.
Most accountants still seem to recommend trusts to our clients.
By the way the new suggestions are not law yet and are likely to be ammended.
Michael Yardney
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FREE subscription http://www.metropole.com.auOriginally posted by billyray:1 – Does the ATO require a licensed quantity surveyor to provide values for depreciation, or can this be done by a lay person, providing they have evidence to back up their values?
2 – Does $750 sound like a good price for this service or have people got it for less?
Yes you do need a QS – a lay person or an accountant is not sufficient.
and Yes – go ahead and use Depreciator, as has already been said – Scott is a member of this forum
Michael Yardney
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FREE subscription http://www.metropole.com.auI know the Reno Kings well, I;m proud to consider Paul and Geoff as friends.
Yes, the peole are real and are graduates of their seminars.When you get to the back of the book Paul and Geoff declare their own portfolio and net worth – something very few authors/speakers do.
Having said that, the results in the book are extraordinary and not “typical” – I understand they were included to inspire you.
Michael Yardney
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FREE subscription http://www.metropole.com.auOriginally posted by bzl8383:I have been looking for investment properties in Cranbourne areas, including Cranb. Central, North and West, Lynbook, Hapmton Park. It looks like that the return is not too bad, around 5 – 6%, much better than the average in SE surburb (3 – 4%). Does anybody have any ideas about thest areas or any potentials in the future ? Any comments are welcome…..
It depends on what you are looking for in your investment property. You will get better cash flow out there but no where near the capital growth of Melbourne’s inner suburbs.
The areas youa are considering are mainly populated by young families, and affordabilty is an issue which will dampen growth in proeprty prices for a few years yet.
For much the same price you can buy an established apartment in Elwood which is predicted by Residex to have 10% capital growth per annum over the next few years
Michael Yardney
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FREE subscription http://www.metropole.com.auEstate agents wouldn’t lie to you would they[biggrin] but they may be a little over enthusiastic.
We see this all the time with investors “promised” unrealistic rentals and when the proeprties don’t lease out at that rent, the agent explains how the market is slow at present.
Ask a different agent in the area what the rent would be if you brought a property across to them to manange.
The best source of current market rentals is looking up rentals on the web portals such as realestate.com.au That’s exactly what tenants do and they are very aware of what rentals should be.
The fact that there are only a few properties for rent could mean that there is no demand as you say or it could mean the opposite – all the properties have leased quickly.
From the tone of your post it suggests that you are looking in a small town and this can be a real problem as rental demand can be very low in these towns and properties can remain vacant for a long time.
Have a look at the internet ad and see if there is a date when the property became available for rent or ask the agent how long the property has been vacant, then keep a track of the ads and see how long they take to lease.
Michael Yardney
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FREE subscription http://www.metropole.com.auIt depends where your property is and what type of property tenants are looking for.
Over the years we have found that 500sq mt warehouse/offices let out well to substatial tenants. The smaller properties are usually leased by smaller “mum and dad” businesses
Michael Yardney
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FREE subscription http://www.metropole.com.auI agree that this is probably not the sort of property an inexperienced renovator should touch.
A tradesman may be able to make something out of this but for a renovator to pay others to repair structural (termite) damage is usually not lucrative.
When you renovate it is better to put your money in cosmetic upgrades -that that look good and make the property more appealing than in structural owrk that no one sees.
Michael Yardney
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FREE subscription http://www.metropole.com.auOriginally posted by Mortgage Hunter:I was reading today that ANZ are now more positive on inner city apartments – they feel the downturn is mostly finished.
Can’t say I agree but it was interesting.
Cheers,
Simon Macks
Residential and Commercial Finance Broker
[email protected]
0425 228 985Simon
The ANZ said that inner city markets had held up surprisingly well, but they were still concerned about what may happen in Melbourne with 3,400 NEW apartments being completed in the next year
Michael Yardney
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FREE subscription http://www.metropole.com.auOriginally posted by ian_from_brisbane:Could someone please give me a rough idea of how much rendering costs? I don’t need an exact amount but I have had a lot of trouble find any information about it in Brisbane.
Thanks!
In Melbourne it costs $40 -45 per sq mt applied
Michael Yardney
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FREE subscription http://www.metropole.com.auThe box gutters are usually done by plumbers. They will also install colourbond fascia. There are also specialist fascia and guttering companies.
If you use wooden facisa it will be considerably more expensive and you will also need a carpenter.
Michael Yardney
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