Richard is great and located in Brisbane

You wont go wrong

Josua

Again there are much better opportunities around than Detroit so why take the risk. In America as in anywhere else it is a matter of buying in the best location to give you a good cash flow and also some capital growth. I see no benefit in buying in Detroit it is a third rate market with little chance of real growth that will cause you problems.

So why take the risk. So where are you based you seem to be selling properties in many markets do you have offices in each?

I tend to deal in markets I understand. I have a partner in Florida and I used to run a real estate firm in Texas. In my view both are good markets experiencing strong population growth and job growth, Detroit continues to go backwards

Yes its good to see you are in one piece

I bet when the power goes out you really appreciate the value of air conditioning. I am glad the Brisbane escaped the worst of it. Good to have you back

They probably need the money, The Cairns economy has been in trouble for some time. The best proof of this is that marketing companies can earn as much as $50,000 for putting someone into a house and land package in Cairns compared to around $30,000 for a house a land package in a major city. Now developers only pay large commissions if they cannot sell the product.

Detroit is a third rate market. If it has gone up its due to investors being silly enough to invest there. I believe that the major car manufactures will slowly pull out of Detroit. For example in the last few years Toyota pulled its truck manufacturing business our of Detroit and Californian and relocated them to San Antonio Texas.

Much of the down town area of Detroit has been abandoned for around 30 years. Do a search on abandoned housing and buildings like a hotel still with decaying furniture. or the central railway station now long abandoned. This is a dying city do not be convinced to invest there it will be a decision that you will regret.

Now even if I am wrong, why take the risk when there are far safer markets to invest in, such as Texas or Florida. There are maybe another 40 states ahead of Detroit. The real numbers are the market is 30% less than it was in 2000. The big mistake is investors believing that this market will improve.

Hi Joshua

I would generally agree with most of your comments and know that there are a few people on this site who do run good businesses in the United States and there are many other who are just wholesalers and not even based in the cities that they are buying in.

Then in Australia there are people selling property who have never been to the states let alone met the suppliers thy are dealing with.

Although I can see the benefit of section 8 tenants I have also experienced the downside if you get a bad one. Often this comes down to where you are buying. If you are dealing in States like Texas and Florida both states tend to favor landlords where in states like New York and California they tend to be pro tenant. Clearly as an investor you would prefer pro Landlord.

I agree with Property Management. We own our own property management firm that has been going for over 20 years. If the company is unsure about management don't deal with them

Hi Sonic

Finance is available at good rates in the 5s % in Florida for residential property and across America for commercial property which will include small apartment complexes. On commercial we can achieve at least 60% funding with higher amounts on more expensive property. This is a growing sign that things are getting better.

Look at lot of people here talk about positive cash flow however the only way to do that is buy in a mining area, develop property or renovate to improve the value of the property

However the only way to create wealth in real estate is to look at capital growth. The better the capital growth the more your wealth will increase. So you can look at different strategies to achieve that however the only way to build real wealth is to achieve the best capital growth you can.

If you buy a whole lot of property that is cash flow neutral or even a little positive but there is little or no capital growth my question is what is the point.

Now I develop property and that allows allows us to keep property at a wholesale price but we target areas with strong growth

I also deal in the United States where it is still possible to buy apartment complexes where you can borrow between 60-90% through a commercial bank where you cash on cash returns can be 14% net or higher

So look carefully and think through your strategy before you decide to move ahead.

To me it is important that it is not a matter of buying a cheap apartment or an expensive house it comes down to what you can afford.

What you need to do is buy a property that is going to provide you with the highest level of capital growth. That is the only thing that will create wealth. If you buy cheap apartments the question is how can you improve them, can you add a kitchen?, increase a space ect. Over the years I have brought a number of older style apartments in Elwood. I generally put in new Kitchens and bathrooms polished the boards, new paint through. 

Now I would do this if I was going to re sell them or keep for investment. Because you want to attract the right tenant or first home buyer.

Naturally a house could be even better however generally the cost of a house in a good area will be expensive. Also with renovating the profit is in the buying. If you buy well you make money if you pay to much you wont. Again this depends on whether you intend to just on sell or keep as a long term investment