We tiled over tiles and it saves a lot of money and looks great. When I told the tenants that lived there for 2 years they were very surprised. Regards, Linda

Hi Gina, I found myself in a similar position recently also. I self manage my properties and approx 6 weeks before end of tenancy I sent a letter to my tenants telling them what the expected rental return was and what I would charge them, giving them a discount for being such good tenants. They do some of the maintenance and have made a couple of improvements out of their own money. I hadn’t raised their rent in 2yrs and I raised it by $40/week and they were happy because they know they are getting cheap rent. We’re happy with no vacancy, no workload of finding new tenants and only have to worry about major repairs at the moment as we’re a bit time poor. I’ll be doing some improvements myself in the next year and then hiking the rent up. I need maximum cashflow so the banks will let me buy more properties (as well as equity of course). So I wouldn’t hold back at putting the rent up if it’s due, and if it makes you sleep easier at night, a small discount. I’d also ask your property manager if a fan,etc would increase rental value before going through expense.

Thanks LA Aussie. Your always so informative. I really like Margaret Lomas too, but only wish I took her advice when I read her books years ago. I’m now re-reading them to get back on track. You can only have so many neg geared properties, till you run out of cashflow…..

I have experienced this response myself from Perth experts in property. You have to trust your own instincts and work out your own investment formula. Good luck!!!!!![biggrin]

We’ve got 101 and 202. We paid about $300 for both when we attended a seminar about 8 yrs ago. I think it’s O.K although I couldn’t imagine sitting around with friends playing and after playing with husband once he finds it too boring. My kids love to muck around with the 2 games Age 5 & 8. I think by the time they get a bit older it will be very dated and not make as much sense. Have you tried looking in the newspapers if your a bit concerned about ebay for second hand ones – or try a WANTED ad? I’m sure there’s plenty around not being used.

Here’s another perspective for you. An old school friend of mine got paid compensation when she became 18 from a car accident when she was 8wks old. She bought a house in a cheap suburb in Brisbane. Her mortgage was only about $30,000. She got involved with wrong crowd and wasn’t brainy at all. The last time I saw her she had rented out every room, including the lounge room to her new druggy mates. The smell of dust in the house was making me feel ill and this lovely well maintained house she’d purchased a year earlier had turned into a dump. I heard stories for a while about stolen cars in the garage, garbage bags of syringes coming from the house while I was getting phone calls off my old friend begging for money so her house wouldn’t get repossesed. I never helped knowing it would go on drugs. After some time it did get repossed. – Maybe a year or so later. She contacted me some years later and told me of her initial $40000 she put in she ended up losing it all plus owed the bank about $5000. At that stage she had 3 kids, said she was off the drugs but the father of her last 2 kids was on speed…….. bit of a recipe for disater. It’s a sad story but if you were to buy her house, I wouldn’t be feeling guilty.

Hi Wayne, if you had to sell any properties I suggested you sell the 3×2 as you have the most equity in it and could pay off most of your PPOR debt. I think if your looking at CF+ properties they may offset the CF- property that you keep. Another thing that I would consider though is capital growth. Is one block substantially bigger then the other? Is one block in a much better location? Is one property harder to rent than the other? Is there more depreciation in the bigger home? I would take these into consideration too. Write it all down. Good luck.

Bridgebuff, let me know how you go on your first venture. I’ve got two small development sites in Perth and still in process of researching and I need to wait for zoning changes to proceed. . It’s a lot more involved than I first thought but it’s getting easier. I’m planning on sub-dividing and selling vacant block as first project and second project developing and keeping as rental properties. Good luck with it.

I would really love to hear some real life stories from investors who buy CF+ properties. And some stories from CF- investors and investors who have held a balance of both. It would be interesting to see how these different strategies have panned out. Please include dates, equity, cashflow and which states of Aus and other contributing factors. eg renovation, new infrastructure, zoning changes etc.