Richard,  My poor english.  I wasn't recommending shares over property.  By course I meant seminar.

The Navra Investment structure seminar is a terrific one and it covers property as well as shares.  In fact it shows how a pos geared share portfolio can help fund a negative geared property for high capital growth.

So sorry I expressed myself poorly.  I am not recommending either shares or property – if anything I use both to good effect.

Thanks for picking me up mate.

Cheers,

If my Dad was a builder I would be talking to him first.  Explore the possibility of buying land and building a house to sell on it.  If you do this a couple of times you will soon have enough savings to keep one as a pos cashflow rental.  Keep doing this cycle and you could be wealthy by 30!

He should be able to build one for you at an attractive rate and help you choose the right housing estate etc.  Another idea is buying an inner suburban dump and demolishing it and building a new home to sell.  Some people do very well with this.

If you occupy one then you can get the FHOG and after 6 months sell it tax free.  You can do this a few times before you will be seen as running it as a business.  But a hell of a good start.

I wish my Dad had been a builder and got me started at 24. 

Just some food for thought.

Be careful of high yielding inner city apartments – especially student rentals and serviced apartments.  You will get very very low CG and this is where the real wealth lies. 

Look at houses on land if possible.

Cheers,

Get a report done anyway.  Firms like http://www.depreciator.com.au have a good guarantee that they will not charge you for the report if it doesn't pay for itself in tax refunds.

I believe you can go back four years but this may have changed since I was involved in helping someone backdate them.  Easy enough to find out if you call the ATO or your accountant.

Ciao,

I take ESL students over summer for about 75% of the normal rent. 

I advertise at the uni online and manage myself.  I also advertise on another website for specific students as I have developed a niche marketing idea to get the best students.  I wont expand on this – sorry.

Each room is furnished as are the common areas.  Most of the furniture is second hand nice stuff but all the electrical goods are new with long warranties.  Easier that way.

I provided a wireless modem but I don't do the adsl setup anymore.  When I did they just abused it.  I had to pay line rental and they made calls and I was always caught out as they all denied making the expensive calls.  So now I tell them to organise it themselves – is much better.

I have the time and interest to self manage.  But in this city real estate agents will manage student rooms.  When I get sick of it then I will get one to manage it for me.  Has been fun for four years now and I am happy so far.  They will probably earn their fee by putting rents up.  I am a bit of a softy sometimes

Ciao,

You wont build equity fast.  Except for the fact that lenders will require a higher deposit as they view these as higher risk.

The high rent is the trade off mate.  Do a search of this forum and see that many new people look at these and serviced apartments first.  Most end up with straight residential property.

Ciao,

I use Depreciator as well.

What are you basing all that upon?

Seems like some pretty major generalisations going on.

Jodie,

Do you have any REAs out there that you can get in touch and ask what the biggest demand for unit sales is?  2 bedders or 3?  Budget style or more upmarket?

I wouldn't be targetting the rental market as your goal is to sell 75% of them.  This means sales data is most important.

I am sure that you should be able to tenant one of them.

Ciao,

If you want to buy a new PPOR and keep the current one as an IP then you need to stop paying down the Principal.  Get an offset and save in there.  If you keep paying down the current apartment then when you buy your next home you will have a 100% loan against the new place which is nondeductible and all your equity in an IP with a small deductible debt.

Using the offset is just as effective interestwise whilst living in the apartment but you can use the savings to buy the new home.

This is vital that you understand this.  Please ask for more info if you need further explanations.

Cheers,

Well you wouldn't lose the whole $225K!

There are 2 bedders for not much more.  Outside of inner Sydney I believe 2 bedders are always more attractive than single bedrooms units.

Always best to do your due diligence thoroughly.

Cheers,

Well if it is family and a holiday home type thing then that eases my mind somewhat.

The big disadvantage that you need to understand is this:

Lenders will insist that you and the sister be joint borrowers on this property.  This means you will both be liable for the full repayments should the other party default.

Now when you go to borrow funds after this your lender will not use half of the repayments on the joint IP.  They will use the full amount for you and the sister.  This may make future purchases more difficult than they need to be.

Having said that, property located close to water has often proven to be strong capital growth potential.

All the best,