Forum Replies Created
By the way, I was looking at Pt Pirie a while ago, with +cf. Not sure if its still good. Also Roxby is supposed to be OK. Not sure about longer term though?
I’m not sure what your experiences have been like, or what the demographic is like in Whyalla, but I urge you to get a good property manager if you buy it.
I will share an experience which has cost me about 60-70K in potentially lost capital gain. We bought a 3br semi in Elizabeth Gr in 1999, as a 1st invest property, for 34K. Rented it for $110/week, and managed it ourselves fresh out of a 4 hour course by WEA and a landlords handbook. We got tenants from hell after 6 months finally – eviction, threats, blah, blah, blah. Leased again after cleanup (not too expensive just a filthy job), for $120 good tenant direct debit from centrelink the whole bit, but she left after 6 months due to domestic violence. The night after she moved out the A/C was stolen, and we were basically scared, stressed, etc, about even going to the property, because of ex tenant blah blah. So we sold it for $54k after 15 months (2001). Ok a nice return over that time frame. Our only mistake was we should have employed a good property manager – even after 2nd tenant. These properties are now worth $110-130K. $10-15 a week and we would have made an extra 60-80K in 3-4 years, not to mention all the extra deposits to buy more of them etc.
I was only thinking about cash positive b/c all the experts told me you’d never make a capital gain in Elizabeth. They were wrong and I believed them and I lost.
I hope you find this useful info.
Resiwealth,
Arrogance will get you nowhere. We are here to learn not to be ridiculed.
Hi Michael,
I’m a big fan of Spann as well.
From what I understand there are two ownership types: Joint owners (ie. married couples usually choose this), or tenants in common (ie. business partners).
With tenants in common you can apportion the ownership between the owners, eg. Tenant in common 1 owns 50%, TIC2 owns 25%, TIC owns 25%.
The suggestion in the post was to put in Tenants in common with a slightly different percentage for each property therefore a different ownership structure is seen by the revenue offices. Therefore each is seen as a different property portfolio and thus accrues land tax at the bottom end of the sliding scales.
RIP = residential IP, CIP = commercial, IIP, I guess is Industrial?
I would love a spa if I was buying a house but I wouldn’t pay extra for it. No one misses what they can’t see, focus on making everything they can see look A1. Good luck, it sounds like you’ve done really well already.
I know what’d I do with the first $1000. If you haven’t already buy yourself a good library of investment books and read them. I reckon question will answer itself for you once you’ve got the financial education.
You have a great head start so you must already be doing something right. I only consider my own experience so far to be called controlled experience where I have developed the tools of a successful investor. I am gradually accumulating more wealth and finding strategies that suit me best. There is no magic formula and if anyone tries to sell you one they’re probably ripping you off.
My education so far has consisted of (in this order:
Buying shares in float (good ol’ TLS).
Buying shares on market.
Margin lending.
Positively geared property, refinancing.
Land value – development opportunity property.
Options trading for income.
Renovation to increase cash flow.
Buying vacant land for quick profit (> 12 months turn around).The near future:
A residential small unit development (3 units).
Build a business.
Commercial realestate investment (related to above business).
More options trading.Each of the experiences builds on the previous. I learn heaps out of every experience and problem that crops up.
eg. I had a land tax problem earlier today and thanks to the members of this forum I just cut my annual land tax bill by 66%. I will now be learning all about different ownership structures and the taxation implications of these.
Good luck, I hope you find something to do with all that cash. (I’m green with envy)
Answering my own Question relating to changing ownership structure.
According to the SA land titles office it is just a registration fee of $98 per property. I think I better get onto a good R/E accountant to see what the tax consequences are.
Thanks for your input Clive. I will certainly take that on board. I can concentrate some investments in the Mildura area (I live in Adelaide) its only 4-5 hours away and there are two states either side of the river.
Nice one!! Thanks very much. 3 more questions.
Can you change ownership structure without selling to ourselves and paying stamp duty? How did you get around this one?
Can you remember where you learnt this?
Thanks again.
Ok, it looks like SA is copping a worse deal than other states, but it seems that other states are still paying about 2% p.a. on larger property portfolios. This HAS to be CRIPPLING to positive cashflow. I haven’t read any of McKnight’s books yet, but a fari few on the subject of R/E investing.
Does Steve address this in his books? I am guessing that it would have been an issue while he was buying 100 properties in 3.5 years??
I have lived in a DHA property. I have also looked into investing, but decided against. When I was looking, the prices of DHA properties seemed high compared to comparable houses in the area. I am guessing they are slightly inflated on account of the other advantages of being “hassle free”, they are also relatively new and should allow you to claim some depreciation on the building as a tax deduction.
If you are looking for a lease back type deal, you could also look display homes in new housing estates. Last time I looked they offered higher returns. They also inflate the prices, but you should be able to claim nice depreciation deductions.
