Now just imagine the value if your friend owned them all in the same block???!!! [juggle] Ahhhhh well…..Anyway back to reality…..[rolleyesanim]

Redwing,

There is no “one is better than the other” IMO, as both have merits, and ultimately it is a matter of personal choice.

You are right though, land tends to appreciate and buildings depreciate, so in that sense, houses tend to win out (for most people).

Personally, I don’t mind units, but unless I can own the whole block I don’t bother….why??? I don’t like body corporates telling me what I can and cannot do; if anyone is going to be “in charge” it will be ME and ONLY ME !!!

But alas, that is what I prefer; someone else may have no problem with, and indeed may well prefer and be quite happy to pay for the convenience of having a [gossip]collective group make all the executive decisions re maintenace etc.

Bottom line….it depends on what suits your taste, as well as your budget!!!

Cheers,

Jo

Hi Tass,

First piece of advice…..

DO THE #’s FIRST!!!! Either on your own, with a lending institute, mortgage broker; whatever….

BEFORE you do anything, think about the $$$ [book] Once you know how much you have and have not got to play with, you can then look at some options!!!

Good luck, and keep the questions rolling, there are many here who will gladly be of assistance.

Cheers,

Jo

I agree guys, PI is definitely more “user” friendly but that is where it starts and ends!!!

IMO Somersoft is a much “friendlier” crowd all round, the chatroom is always occupied by very chatty/friendly types, and the forum posts are not only informative, but facts are better researched and generally far more authenticated!!!

This place leaves Somersoft for dead in members, but I think eventually time will see a turn around. Either way, both have pros and cons, pluses and minuses, it depends on what matters most to you. For ME where Somersoft falls down in functionality it regains ten-fold in factuality!!! [medieval]

Jo

Hi Calvin,

Thanks for the 5c pieces sent via your PM!!! [laugh4][laugh4]

As I said, don’t worry too much, what you are experiencing is normal anxiety and is often associated with most things in life, especially major issues, ie. marriage, divorce, new job (not necessarily in that order)!!!

Most investors experience a level of it at some point or other; some handle it better than others, some just block it out. Me personally, the “thrill” of making a property mine is a real adrenlin rush, and any anxiety or as I call it ‘OH MY GOD I HAVE JUST SPENT X DOLLARS” slowly diminishes as the settlement date nears.

You will be fine; and I promise, you’re not “loopy”!!! [wacko][wacko] You should have seen me when I invested in the sharemarket, watching my $$$ on that roller coaster ride ever day!!! Now that was….[rolleyes4][rolleyes5]

Cheers,

Jo

Hi Westan,

I knew you were kidding; it’s all cool; have moved on [tongue]

Anyway, thanks for explaining the Cash on Cash thingy; you did it well BTW. Am I correct in thinking it equates to the “NET YIELD” as opposed to a GROSS one (where you do the calculation as per your example, hence not taking into account any deductions)???

Either way, because my main focus in CG, the “net” or “gross” returns are not the big issue for me; although I do PREFER to have AT LEAST a 6% (in today’s market) return (gross) which of course is less, by the time you take out expenses, or giving you that CASH ON CASH return you talked about. The only benefit (on my part) is that I have NO MORTGAGES to repay, hence it makes my returns somewhat slightly better. I know it sounds poor in comparison to your cashflow returns, and I am not (by any means) saying one strategy is better than the other, I am just saying, cashflow is important to me, but is not my main driving force; growth is!!! You have to do what works for you, and for me, growth is what allowed me to retired at the age of 39 (2 years ago)!!! [thumbsupanim]

Nonetheless, I think what you have achieved is awesome, and as long as you get to where you want to be; in my books, that is true “success”!!! Well done!!! [specool]

Jo

Hi Gatsby,

Sorry I can’t help too much ATM, I have been in and out for the past few days (and will be so, for the next week at least) hence I have not been able to gather much except for this little bit I found (on the run) this morning:

Domain Suburb Snapshot: Pakenham
http://www.domain.com.au/UserServices/suburb_report.aspx?mode=subsell&PostCode=3810

Cardinia Council (demographics & forecasts)
http://www.id.com.au/cardinia/forecastid/default.asp?WebID=220&MnID=4&PgID=1

Cardinia Council Homepage
http://www.aussoft.com/cardiniaweb/index.asp?h=-1

I don’t know how you went with your search, however, I would imagine that you spelt PAKENHAM correctly; otherwise that may be why you had some trouble.

Either way, sorry the info is brief (but rushed) got rush off again; good luck with your search. Pakenham is very close to Cranbourne, and both these areas are expected to do well; so IMO if you take a close look, you will find that property prices are still very affordable and rental returns are fairly average. Don’t forget http://www.realestate.com.au

Cheers,

Jo

Bennido,

Try and remember, there are SELLING agents and RENTAL property managers in RE; two different divisions.

In defence of Selling REAs….the one acting in the sale of the property is not necessarily going to be versed in the “rental potential” of the property, and hence will often give you an estimated figure, which of course may be way above/below the median range for rentals in the area (for similar type property).

If the property is currently tenanted, or even was recently so, ask the selling agent to check ALL rental history available to their agency, ie. how long rented at that price, what was it rented at before, and get him/her to speak to someone in their “rental department” to give a more accurate indication of what rental return that type of property could expect to achieve. Get the selling agent to arm him/herself with that info BEFORE you start grilling them and possibly risk falsely (or unfairly) accusing them of being “slick”.

Jo

Hi there,

SIS,

No problem; thanks for your comments, it’s always good to have more than one opinion, and hear/read what other people are doing; so I appreciate your input. Sounds like you’re got your plan of attack down pat, and are moving forward….Keep it up; well done!!! [thumbsupanim]

Westan,

You said:
Actually if i owned some properties in Melb or Sydney i’d flog some of them off and by a real investment that puts money in my pocket straight away and will grow in value (no that will upset you).

[blink] I am confused, which part do you think would “upset me”??? Flogging off the properties in Melbourne??? Or opting for “money in my pocket” part??? True, I live and invest in Melbourne, but it is by no means, the antz pantz you must think I see it as!!!! As for having cash in your pocket….better there I say, than in the taxman’s!!!! So you see Westan, I’m not upset, quite the contrary, I am HAPPY for you (as I would be for any other “smart” investor achieves what they set out to!!! [thumbsupanim]

As I have always said, although I do not subscribe to the notion that “cashflow is king” cashflow is a good thing, and I would never suggest people do without it. However, I personally PREFER growth, ONLY BECAUSE that is how I created my wealth. But that is my strategy, and it is neither right or wrong, just how I did it!!! Bottom line, and I have said this to death “if it works for you; knock yourself out”!!!

As for Cash on Cash returns, I must plead ignorant, I have never used this expression, so if you will simplify it for me, I will be more than happy to answer. What I can say is, rental return yields as long as I can achieve the going rate in the area, as well as at least 5% CG per year I am happy, anything above that is “cream”!!!

I don’t believe your success has necessarily come from buying in NZ or from buying “cashflow positive” properties; IMO it has come from RESEARCHING the right places that can offer the returns that YOU want, and by so doing, what or where you buy becomes secondary!!! WELL DONE!!!

Cheers,

Jo

Hi Emcdonald,

Get yourself the biggest, widest money box you can find….a 44 gallon drum (all dolled up) will do nicely [lmao] (just kidding) just any old BIG sealed container …and drop all your “gold” coins into it!!!!

I tried that once for fun, thinking it would be interesting to see how much I could come up with; I started it on New Year’s Day and by the time 1st December came round (to my amazement as the coins hardly filled to quarter of the way) I had managed to save just over $1800; not bad for just emptying out my purse of its change each night!!!

I was so pleased, the next year, I decided to do it again, only this time, along with the gold coins, I was decided to fold up notes, whatever I felt I could spare at the time…..so occasionally I’d fold and slip in a $5 dollar note, other times, I’d (begrudgingly)[glum2] put in a $20. Come December again, and hey presto shocked2] $2500…I was stoked!!!!

Try not to see saving as a “chore”. After all, who said saving can’t be fun????!![juggle]

Jo

<<I think sometimes we presume that poor yields, and NG’ing means that we will get growth>>

In my 23 years I have learnt to “presume” nothing; I have ALWAYS bought property with the “fundamentals” to which you refer Kay; being “Location and Quality” (although heavier on the former than the latter) for without them, regardless of whether the property is highly positive or negatively geared, you risk being stuck with a lemon!!!

One property I purchased many years back had a 2% yield, but it was in the beginning of my journey, and was all I could afford; I cringed with the thought of paying 175K but I knew the area (as you said) like the back of my hand; the location was second-to-none, and the quality was rock solid. Needless to say, I sold it 10 years later for a whopping 925K shocked2] Trust me….I had no expectations of such growth, certainly not of that size (not even in my wildest dreams)!!! Go figure….[whistle]

Jo