Forum Replies Created
Marrickville? Still a dodgy suburb in my book. Pay half a mill to live amongst gangs and shootings? HMM. The thing is that I think you might be able to get the A-grade Sydney suburbs for that kind of money pretty soon! I guess that means that I think capital ‘loss’ is likely if you are trying to SELL in the next year or more.
If you are trying to buy I think it would be a pretty good time.
I guess I agree with those experts (whoever they may be!) about 2005.I’m trying to get prepared for what I expect to happen next year. And then guess what I’m gonna do!
cheers-
Minijoy to the world
Hi Kay,
yeah if it wasn’t for Steve’s seminar I wouldn’t be a) here right now and b) living my dream which property deals got me to and c) having a few properties now.
I just was so not comfortable with the whole numbers and investing thing in general as it was so far away from my life thus far. Reading books helped, but it didn’t push me over the edge to TAKE ACTION like a seminar did. it helped me figure out in actual $$$ what the risk actually really was, and then realise I could handle that risk and be OK. So I went for it and the rest is history.
The FUN part of the seminar is (can’t speak for AR, only for Steve’s one – ) a) when the light bulb finally goes off in one’s head and b) meeting other like-minded light-bulb people.
outside the seminar, the world seemed to be full of people who weren’t investors, didn’t think it was a good idea, etc and inside the seminar it was full of not only successful investors keen to swap stories and tips, but others ahead of one on the ladder who were full of encouragement.
It’s also fun to see how far I’ve come and that even if I’m only 4 steps up the ladder, I can still be of use to people who are yet to take the first step
Anyway, yeah, I would have liked to have gone, but my mum bought the CD set and I will get to listen to it at some point!
cheers-
Minijoy to the world
I’ve been looking, albeit in a ‘still dreaming’ kind of way, in Double Bay, Rushcutters Bay and Darling Point and actually pinching myself at how CHEAP things seem (OK, ‘cheap’ is all relative I know, but I am SURE these joints were heaps more expensive a year or two ago -) and I’m seeing 4 bedroom houses on 540 metre lots in Double Bay for around 1.3 million, (they say 1.5 but you know they are dreaming -you can tell when you speak to the agents! -) and even an absolute waterfront darling point apartment with private beach, swimming pool, (apartment looks out on swimming pool, boats, and beach) and private jetty for 1.2 million list price. You know 1.2 means you could probably get that for 1 million in today’s market! There seems to be quite a lot on the market, too.
I reckon we are well into the ‘spring’ of duck season, but I think the season will continue for at least 2 years and for up to 4 years, give or take inflation
my 2 cents
Does it seem like the bargains are starting at the top of the market and filtering down, but they’re not at the bottom of the market yet?
cheers-
Minijoy to the world
Hi Kay
i think you did hug strangers (us) by offering your ticket to the seminar (!!!) and I think you are cool
thanks for that
cheers-
Minijoy to the world
I would agree that 5k seems a lot per deal.
I would seriously recommend the bird dog DD on the forums, I have used him myself, and his specialty area is Queensland. He not only has ALL the data of employment, infrastructure for the future at his fingertips, but can tell you specific things about what properties in the same street he bird-dogs in sold for and when, plus has a team of people on the ground i.e. rental managers, pest inspectors, etc etc and if you book them through him you get a discount, etc etc
plus he is a Serious investor himself – and he only charges around $1500 a deal unless this has gone up since I last chatted to him.his forum name is DD, just give him a PM
cheers-
Minijoy to the world
I get why lenders won’t lend on the most overpriced suburbs of Sydney right now until they have ‘corrected’ a bit.
joy to the world
Locked threads = “awwww, spoilsport”
Moderate dodgy posts = win/win
“Those who believe interest rates are going to remain at current levels for a long period of time are kidding themselves.”
Not necessarily! Maybe they FIXED their mortgages!!! hahaahahahahahha
Re: promoting one’s own town, I never name check where I am investing and neither does Steve, though everyone seems to want him to!
HAHA.
however I am a bird dog and I do source properties for others in the towns where I invest myself. this is because I know the streets, the market, the locals, the best building inspector, the best rental manager, etc etc – because I invest there myself. I would find it hard to bird dog deals where I DON”T have deals myself. That is why we are using different bird-dogs in other towns, and believe me we bird dog eachother deals too behind the scenes, as well as to our clients. I would find it hard to trust a bird dog who said ‘this is a great deal, buy it’ – and didn’t have deals there him or herself.blah blah
cheers-
Minijoy to the world
Parents teach kids more than schools ever could.
literate, cultured, socially aware and enlightened parents will raise literate, cultured socially aware and enlightened kids – bright and talented kids with self-esteem and compassion – and *they* will be the ones who do well in school, not to mention do well in life!! – and along the way those kind of kids are the ones who get scholarships to whatever their parents consider are the ‘best’ schools – no matter what the parents earn.
School schmool.
joy to the world
Hi Kaye,
I agree with you about Australia right now. I predict there will be deals in Aus again, but they might not be aplenty until everyone is way cold on property and sick of it and sick of watching prices going down and selling like lemmings and nobody is buying! *That’s* when i will be buying. Meanwhile for *now* I am buying in other markets as you know!
“I only have a couple of properties, Mini, as do you,”
hehehe
as DID i!!! a lot can happen in six months, hehe…“but if I was buying *today*, and thinking forward for 7 years, I would be thinking about growth- as you also do. “
indeed!
CF+ve with growth potential is my favourite sort of deal!“I fund them by working and adding money into them. It works for me. “
so be it!
cheers-
Minijoy to the world
“I would argue that the person with the million dollar house- which made “invisible money” during the boom… would be far better off financially. “
Kay of course you would argue that and you always do because in your paradigm you cannot accept that CF+ve properties go up in value. they do!
My funny little properties have gone up in value in a year more than any Sydney ones did at any time in the boom. I think the highest was Manly at 27 percent or something, well mine did more like 50-100 percent capital gains in a year, ADD to that 20 percent cashflow returns.
A friend of mine bought a 6k section which is worth 30-35 k a year later. try THOSE figures through your calculator and see how much you would have if you’d bought a million worth of those rather than one Sydney property.
OK, land is ‘negatively geared’ but then so is the Sydney million dollar house (trying to compare apples to apples)My friend bought there because research (which was out there for anyone to have done) showed there would be a likelihood of increased demand in the future where she bought her land.
another point is if you had a million dollar house (likely negatively geared) you would probably have to stop there unless you made more income from OTHER sources, I mean to buy more deals – you’d max out. whereas the person with 30 CF+VE properties would be able to keep on buying and not max out without having to fund from other income.
Also the person with capital in 30 deals rather than all in one basket is much more flexible. Sell one, or five, or ten, move them into this over here…the person with all capital in one property can only basically do one deal – refinance or sell to realise this ‘invisible money’. By this I assume you mean capital gains which I realise you are still convinced only happens in ‘Sydney’ (or similar.)
While you stay in your paradigm there are not a lot of options for you. I know you must do what is right for you, but I wish you would realise that there are many ways to ‘do it’ even if they are outside your comfort zone. and just because you wouldn’t do it doesn’t mean it couldn’t work beautifully.
cheers-
minijoy to the world
wicked!!!
I went through the ‘walk away’ process on my first potential purchase after a dog of a builder’s report. it was a more expensive property so my expectiation of what I should get for my money was higher. My second two properties also had dogs of builder’s reports but they cost about 30K each less than the one I walked away from with almost just as much rental income. I spent about 9k on one and 14k on the other and ended up with two completely redecorated properties, both with new fireplaces, both fully maintained (as much as any landlord ever can!) and one with a new bathroom. of course the value went up should I ever decide to sell, the places look fabulous, and tenants love them because they are always tenanted.
but the reason I went ahead with the second two but not the first one is that with the cheaper properties I wasn’t expecting them to be that flash (they weren’t) and I was prepared to fix the problems if I could get them at the right price. That’s all it comes down to really and even vendors and agents can understand that. so you don’t need to be apologetic about the discount you require. if the vendor says no they say no, walk away. however my tip when trying to get a sizeable discount after finding ‘issues’ is to mention the word ‘unconditional’. I mean don’t negotiate unless you know you would be prepared to go unconditional. then the old ‘bird in the hand is worth two in the bush’ applies and the vendor could decide, how long would it take them to find another buyer who would give them 5, 8k more or whatever, and here they have a buyer in the hand who is prepared to go for it despite the defects, i think they will go for it or at least meet you somewhere halfway. and if you know ahead of time what your cut-off price is to walk away or to proceed, it’s simple.
Good luck with it and keep us posted ok!!
cheers-
Minijoy to the world
Hi there,
I agree with westan and geo.
only you will know if 79500 minus whatever you an negotiate, plus grief, time, on an 11 percent yield return is worth it.
How likely is it that you could find a similar property at a similar price without anything needing doing? (hopefully if you have looked around you will kind of have an idea of what’s on the market)
will you make money or lose money solving the problem?
think about things like chances of capital gains, rental demand, town, street, etc and weigh it up.
Personally I would say “i’ll go unconditional at 63k”. That way you get a house still for 79500 all up, but with a new roof and a new fireplace, more chance of a tenant and long term viability, and 4k for the downtime/grief of organising it.
if the vendor says yes, go for it. You’ve built yourself in some safety, plus like I said you can probably get a new roof for less than 9k.
If the vendor says no, then think about it some more and figure out if you can go up a bit. I.e. you might decide that at 67K or whatever (less the estimated price of repairs) it is still a good deal. then go for it. But don’t be scared to write off the cost of the builder’s report (negligible in the long term) and walk away.
cheers-
Minijoy to the world
sis said –
“but there are other better investments than property at the moment”
” Sydney property market is down 5.4% “
Yeah, well, there is that.
I am certainly not advocating ‘investing’ in sydney at the moment!!!
With any investment you pick what you are wanting to achieve, and weigh up the risk, return, and work involved. Sure, renovations in booming markets make money, but me? sure they work and make money, but I just don’t have time to do them that often. sure, term deposits or bonds are safe and secure, but they have lame returns – and cash deposits go down in value over time (100k cash is worth less next year than it was this year, thanks to inflation and rising costs of living) – So in the end with a cash deposit your interest is just simply treading water and not storing or leveraging your wealth.
Shares, yah, well, yawn. everyone I have known that has done well on shares has immersed themselves in it, almost like a full time hobby or a full time J.O.B.!!! I have a full time LIFE doing something I LOVE so I just want an investment to store and grow my wealth, and not require me to check up on it every day. Especially not if I find it boring like I do shares.
So back to property – which is my investment of choice. – I am getting twice as good cashflow returns as with a term deposit, (nett after costs!!) and 6 times as good if you count capital gains. If capital gains stop completely, I will still get three times term deposit ‘interest’ as cashflow, because rents have risen and the investment is performing even better now a year later compared to what I’ve put in.
It’s an absolute no brainer to me that when the market isn’t doing capital gains, you buy cashflow, because rental demand is heightened – everyone rents, and rents rise. Cashflow goes up. Then when yields start to go down it means that capital gains are occuring. This is somethine completely logical and predictable which evidence through my analysis of figures of the last 13 years has aupported.
So I figure you buy for cap gains or for cashflow depending on what the market is doing. of course when nobody is buying, you get a lower purchase price which means higher yields which means painless holding until the next boom when you will get capital gains all over again.
These are the reasons I am sticking with property (i have more, but that will do- !)
Sure, I am not averse to pulling out of one market at a high and getting in to another, a la Steve mcKnight, but I’ll still stick with property as it has the low time-factor long term thing I need, the security (everyone needs somewhere to live, population of the world is increasing, it costs more to build new than it does to buy a pre-existing home – ) etc etc.-
and the cashflow returns which will eventually enable me to live off my assets WITHOUT SELLING THEM!!$ 12,500
PRIME LOT – LOCAL SPOT
A rare chance to secure an excellent undeveloped 920m∫ lot close to the centre of town. Services installed and plans for two units available to successful Purchaser. Be very quick for this opportunity.in a growth area.
(this was an actual ad!!!)I know it’s ‘negatively geared’, but as you can’t get a CF+ve property for 15K without a mortgage this is the next best thing I reckon and I just might ring up and whack an offer on that land myself tomorrow!!
Also with the change you pay the rates for 2 years or stick a horse on it or whatever for the cost of the rates per annum, and then you will probably be able to sell it for 30-50k in 2 years, which is conservative!!
cheers-
Minijoy to the world
PS!!! I a weird, because I call suburbs i.e. Blackown, Rooty hill ‘woop woops’ and my ‘walking distance to town’ properties in small towns NOT woop woops!!
Invercargill – yields around 11 percent on current prices, if you can get a tenant – as there may be an oversupply of certain types of rentals.
Capital gains potential – don’t know, as the long term trend of decline has been stopped and somewhat reversed by the ‘students study free’ trick the clever mayor has introduced, plus other clever marketing of the area. A reasonable size population of 50k odd (I think) means a lot of people (aussie investors!!!) are attracted to it for that fact alone. Fair enough.
but buying for capital gains? i don’t know.
It wouldn’t be the place I would be buying in for capital gains, that’s for sure.rental yield? OK, maybe 11 percent is okayish given the town size and if you can get a reasonable property without much to do to it, and one in a good-ish area that will always have demand even if the town starts shrinking again like it had been for the last 12 years. (Yep. 12 years.)
But if you get stuck without a tenant then you have saddled yourself with a property that may go down in value. Just be careful and if you buy there get a second opinion from a rental manager not selling you the property as to your chances of getting a tenant.
cheers-
Minijoy to the world
CORRECTION!
I don’t have any properties in Tokoroa myself.
I was bird-dogging deals there earlier in the year when we were able to get 18 percent plus yields. At that time I think it was *great* buying and I am sure my clients would agree – especially as they would have had capital gains along with their high yields! Yeehah!
but now… prices have moved. And so yields are now less.
As we either like to offer our clients either high yields or CF+ve with capital gains potential (i.e. 10 percent plus, but in growth areas) –
and as wouldn’t want to buy somewhere at potentially ‘top dollar’ neither getting capital gains nor cashflow – and as I think that there are better areas elsewhere right now for cashflow – as well as better areasfor capital gains – I am not looking there right now other than a cursory glance now and then.But the town isn’t going to die or anything – it’s large enough and it’s well positioned to absorb ‘action’ from the ever mushrooming Hamilton, which is itself well positioned to absorb ‘action’ from the ever-mushrooming Auckland….
I am still not saying you couldn’t find a good deal there, just that you won’t be competing with me for it!
– my two cents.
joy to the world
yippppEEEEEEEEEEEEEEEEEEEEEEEEEEEE!!!!!!!!
joy to the world
Hi thanks for that Ben.
I guess the things to ask if it’s a one industry town is a) is the industry on the up?
(possible expanding the plant, more people, more demand, capital gains and more rents)
or is the industry on the downturn
(possible closure, your house plummets in value, becomes negatively geared if no more tenants, or if tenanted means demand has gone way down so the yield has now turned to crap, no income now and can’t sell the place – no investors interested and no home buyers in sight.)
I think I read somewhere that mining in Aus is down, though whether that’s because they were running out of whatever they were mining or due to the world economy and demand, I don’t know.
but also add into the mix that most of the mining towns are remote and not on some main thoroughfare let alone on the coast or at least close to something, it seems these towns exist purely because of the mine. (or mill).
So your property fortunes will be linked.I think to buy in these places *could* still be OK IF people were crying out for rentals and there was high demand which was also expected to continue, if there were plans to develop, if the town had a long term trend of population increase not decline, AND the yield was super-high (20s to 30s) to make up for the risk.
I went to this place called Gove a couple of months ago and it’s a great place, lush and tropical, and though remote it’s on the coast, it mines something or other which you can see when you fly in, (bauxite perhaps??) and they are crying out for rentals, BUT houses are really expensive, so they wouldn’t be ‘cashflow positive’.
I would personally be looking to invest in places that are in transition (just about to go off, developers starting, houses still undervalued on a global scale, high yields in towns with stable populations and industries, within a couple of hours of major regional towns or main cities and airports etc, and on a main road so they get through traffic, rental demand, etc etc
but Kalgoolie is pretty stable isn’t it? Been there for yonks and is growing isn’t it??
cheers-
Minijoy to the world
Throw more money at the builder and he or she will prioritise your project for sure.
joy to the world
SOOOOO interesting, all of this.
So mine is basically like Celivia and Acey,
“To love, be happy, and have fun in life as much as possible.”and to that I would add ‘to show/help/enable others to love, be happy, and have fun in life as much as possible too
and
to take complete responsibility for everything in my life and never cop out or blame others
and
to love the unloveable
and
all the freedoms –
financial, spiritual, intellectual, freedom of thought, of speech, freedom to pick and choose what I want to do with my timewhich, when I got it, would be just to spend it doing more fun stuff and helping others have more fun too. I figure if you are having fun, you have more energy to help, no burden on anyone else and you are healthier (they’ve proven that) and you live longer, so therefore your life becomes more cashflow positive, haha, etc etc
At the end of your life you won’t remember the dollars and the zeroes – or how much something cost, you will remember the experiences and the feelings and the people and the love.
However if you worry about money (or anything) then you won’t really be able to enjoy the experiences and the people and the love because you will be only 10 percent there in the moment and 90 percent worrying about the future.
but to touch on someone else’s comment about everyone having ‘selfish’ goals, but one must get one’s self there first, otherwise one is just ineffectual, a whinger, a hypocrite, or similar!
i.e. how could I pay for a semi-trailer of goods for the Smith Family if I can’t pay my rent and my finances are in a mess? how can I love someone properly before I love myself properly? (it’s not love then, it’s co-dependence, or conditional!) how can I make others happy while I am miserable?
(you can’t!)
how can I support my family into their old age or young age or whatever if i can’t support myself?(uhm, pass…)
How can I hope for world peace if I hold grudges against someone? (you can’t, you’d be a hypocrite.)
end of philosophising
joy to the world
Hi Calvin,
I reckon what you are feeling is typical of first home buyers. And so be it.
but like what you recognised, you don’t get that feeling about investments – they should be on the numbers. like choosing any investment, you weigh up chances of growth, risk yield, security, losing the lot etc etc.
For me, I bought three investment properties i don’t live in and still haven’t bought a PPOR – I rent it. this is for several reasons, one, I don’t have a wife. hehe. Two, financially I am tens of thousands of dollars a year better off by doing it this way, believe it or not.
cheers-
Minijoy to the world
