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Ok i have had some sleep now, i was literaly still travelling back and 40 hour journey with little sleep makes one a bit cranky. Perth to Orlando are pretty much opposite sides of the globe.
We purchased the property mainly for my sister in law to rent. She struggles so we helped her out, she has a nicer property now than where she was for less rent than she was paying. Even at full rent however the property wouldn’t be cash flow positive.
Yes we could of got property here but we wanted to help out family. From our point of view we need the tax deduction and it is a good investment. The house is about 10 mins drive to downtown Orlando and in a good area.
From an investment point of view the house will gain value, we bought it at parity so when we do eventually sell chances are the dollar rates will be back to .70c to the A$.
We bought in a trust and used our line of credit here to finance it. After going and seeing the market for myself I would strongly suggest you go and see for yourself what you are getting and more importantly where it is. Like I mentioned earlier streets within the same suburbs vary a huge amount.
And as I said I’m not here to debate tax matters. If you knew that was the case why not say it in your first post instead of trying to make yourself look all high and mighty now. You said nothing in your post except are you sure.
I guess it all depends on your individual situation. When you pay over $100k a year in tax you learn to love the words negative gearing. Don’t plan on holding the property for 20 years either, maybe 5 depends on the US economy. If prices go back to what they were in 5 years I have doubled my money, reduced my taxable income in the meantime and helped my sister in law with more affordable housing. All around a win situation for us.
Anyway, I’m not here to debate tax issues or what anyone else thinks about what I do or why I do it. All I’m doing is telling how it was in Orlando.
On the subject of HOA fees be wary. Some suburbs with high foreclosures and vacancies are charging existing owners more to make up for lack of regular owners all paying what they normally would.
Qlds007 wrote:Are you sure about that Your trip over is a taxable deduction.CheersYours in Finance
Absolutely, whether the 1st trip is added to the cost of sale and then taken off a future capital gain or used as a deduction it comes off your tax somewhere down the line. Confirmed by both the US and Aus accountants. After that 1 trip each financial year 100% deductible in that year.
As for the rent, we charge $1000 mth. Could maybe go to $1400 tops but we are happy for it to be negatively geared here and the aim was to give the sister a nicer place to live. The property last sold in 2006 for $395K so we will enjoy the capital gain further down the track.
Mate I have emailed you directly with no response. I WANT TO BUY SOME PROPERTIES AND WOULD LIKE TO USE YOUR SERVICE
At least you guys get an answer, I have sent 2 emails saying i want to buy several properties and would like to meet with the Orlando office and had no reply. Guess they must be busy enough without any new business.
The wife and I have been giving this a lot of thought over the last few days, condo v SFR. We have decided to go for just 1 condo close to the beach for our own future use and then the rest SFR. At the end of the day if they don’t make land anymore so for long term investment we feel SFR is the way to go.
Yes maintenance may be an issue but based on the inspection report we were provided for our last purchase not much gets missed and a very detailed report was prepared. Newer properties should be relatively maintenance free.
Seems a lot of these condo HOA fees bend you over and give it to you right up the mangina!
I will also be at the Perth seminar
British Buyer wrote:Hi Jason
Sounds like you're already sold on the Florida idea.
Can you give me (and any other readers) an idea of what you perceived the Orlando market to be like. Ie. how cheap did things look? Did you feel it was bottoming?
I'm leaving China tomorrow, and will be in Miami on Wednesday. I have no idea what to expect, other than a lot of self-interested estate agents and mortgage brokers.
I've failed to open a US bank account from overseas, so the first thing I'll be doing is that.
I will then make the rounds of a few lenders I've been talking to. However, I will probably just submit my application and then start looking at property to buy with cash (ie. cheaper houses or condos). If/when my pre-approval comes through I will consider buying a more expensive single-family home (about $400K).
Hi Steve
Compared to Perth the Orlando market is a steal. To be honest we dont care if prices go lower, we are in it for the long haul so will still make good money when we decide to sell. At this point in time prices are a steal and the exchange rate is almost on parity so we are jumping in.
This may go against most investors strategies but I go by gut feel, and Orlando feels right. Some folk over analyse things to the point they find it hard to make a decision. I have no clue what the unemployment is like in Orlando, but with disney and universal close by we will turn the properties into vacation rentals if need be. I have not looked at any graphs or statistics nor do I intend to.
There may be better buys in better cities and good luck to those who do purchase these properties boasting cash flow positive figures. For us we feel good with Orlando plus as I mentioned earlier we have family there who can keep an eye on things for us.
My wife and I have used this strategy for the last 20 years, gut feel. I have been retired for the last 8 years, since I was 30 so the strategy has done well by us. Nothing ventured nothing gained as they say!
Booked our flights today so hope to come back with some good information for other investors. Folks no doubt will do more research than me and thats fine but at least I can help with the setting up information which seems a closely guarded secret by those posting for their own business gains here. Fair call however we all have to make a dollar somehow.
I wont be using the agent we bought this property with (extremely bad handwriting, looks rushed and my 8yr old writes better) May be trivial but the gut says there are better to be had.
Hi Steve
Some awesome information you have posted in this thread, well done. I have just purchased my 1st property in Orlando and will be heading over around the 15th of next month to close the deal. I know it could be done from here (Perth) but we want to snap up a few more when we go over.
We used our line of credit here in oz to finance everything. 1st property was $205K – my sister in law will rent this property from us. We plan to purchase a condo for about $100K in cocoa beach and grab a few single family homes in orlando around the $50k mark.
We chose Orlando based on the fact thats where the sister in law lives, We have read some shocking stories of useless management agents and maintenance people. By purchasing here we can have the sister in law manage the properties and her husband do all the maintenance.
Not particuarly fussed about positive cashflow as our plan is to make the money in capital growth. Plus as we have everything financed here in oz when the $AUS drops and the $US rises we will be getting more for our rental dollar. In the meantime some negative gearing wont go amiss.
I know you are keen on Miami (and we may even grab some down there too) but hopefully when we get back we will have some usefull information on Florida in general to share with fellow posters regaring reputable accountants, setting up LLC's, registering with the IRS etc.
Once we have exhausted the cash we will then look into borrowing to purchase more. We have the option of selling investment properties here in Perth and tapping into the SMSF but I feel 6 or so properties in the US will add a nice balance to our investments wiithout throwing all our eggs in one basket.
Good luck with your purchases
Jason
