Forum Replies Created
The offer layout in my opinion is not important at all.
Just email the vendor or real estate agent your offer something like…..
"I Nonnie E would like to offer the owner of <address> the sum of <$> for the purchase of that property."
If you are serious about it and know you can get finance ask for a copy of the contract and take it to your solicitor/conveyancer and sign it. (Cation: 5 day cooling off period may be void if you take the contract to your solicitor before signing) Of course with finance and or inspection clauses as needed. If you sign it without legal advise (in my state at least) you get 5 days to pull out of the contract without needing any reason at all, giving you time to seek legal advise.
A signed contract in front of a seller is mighty tempting and the conditions can be changed if need be to get the deal over the line.
If you are not comfortable with this just make an offer on a scrap of paper / email until the seller wants to sign contracts. You can lose sales though if the competition is strong.
Most important to have your finances ready.
obie…
Lisa,
You could buy a copy of Australian Property Investor and My Property Investment magazines and check the stats in the back of each of them.
There is also a website that will tell you the last 15 or so sales in any street in the Territory along with recent sales in that suburb. http://www.nthomes.com.au give that site a go it is very helpful.
O…
Just to clarify my earlier post, I have a different lender for my IP then my PPOR , I think this negates most of the problems of x-collaterisation. My IP lender has a second mortgage on my PPOR not my PPOR lender. Some may disagree and I would like them to explain the diffence betwen having the same lender. It is my understanding that different lenders with x-collaterisations is a different matter.
O…
HI Lisa,
I Live and invest in Darwin and still believe it is a good market to buy in at the moment.
Although people say that Darwin is at the peak of the cycle, I only see the market going up here in the near future. Demand is high as you can see by the high rents and the market has risen by about 4% in the last quarter on median prices. Population is growing and we have some big infrastructure projects starting here in the near future, in fact the biggest ever in Australia being the Impex project. The goernment is trying to release new land as fast as it can and having to raffle the chance to buy blocks. We have four new suburbs at Palmeston planed for over the next few years. People can not get their hands on them quick enough. This has also risen the prices in the Northern suburbs and the city/costal areas as well. You could do a lot worse then investing your investment dollars here at the moment.
That said I think all house prices across Australia are in for a big rise in the near future as the past shows, the property market always leads the economy out of a recession, so I think where ever you buy would be good.
As far as positive cash flows go Darwin is full of them at the moment with the low interest rates. The IP I bought in the Northern Suburbs in December 08 was close to neutral at purchase and now just positive. If you are keen, go to the property rental specialist companies in Darwin or even realestate.com and get their lists of properties for rent and check out the rental prices, although there is a lack of stock on the market at the moment.
Then go to http://www.nthomes.com.au/public/nthomes.nsf/Homepage?Open where you can check out the latest actual prices the houses in that area have sold for, that might give you areas that supply best yields.Financial Advisors, I can't really give you any experts I have used, although Barry Pickering, who lives in Darwin now works from up here advising and is running free seminars at the moment. His seminar is free so maybe you could check it out, I gave them a call and they sound fairly helpful. I went to the seminar tonight and it was quiet good. We don't get many chances up here to go to any seminars let alone for free. Check out their website if you want to go to one of them. I have no connection with them, just went along to see what they were about. >> http://www.capitalmarkets.com.au/
I hope this helps and is only my personal opinion of course.
Any more questions, I will try to help
O…
I think you have guts and maybe it is worth a try if you have the time to put into it.
I am only familiar with the Residential Tenancy Act in The Northern Territory but you will need to do a search on the Act in your state and read it carefully would be my advice.
In the Territorry you have to issue a "Notice of intention to terminate for failure to remedy Breach" to the tenant after they are 14 days in arrears, then they have 7 days to remedy said Breach. After which you can apply to the court for an order for possesion after which they have 7 days to vacate. They can then apply for the Hardship clause. (but so can the Landlord)
As you can see it is not that easy to get rid of your Tenant if they wish to make it hard for you.
Insurance can also be a nightmare especially if there is damage in the common areas. You may have to put locks on all bedroom doors fr Insurance purposes.
There is also a good article in July " Your Investment Property" Magazine on p16 about tapping the student market.
Best of luck mate you are braver then me.
OBIE…
Terry's post was not up when I posted mine just as I finished lunch and posted.
I can understand how that could be a problem though.
I have taken this into account though and have about 100k in an offset account for reserves as well as disability and death insurance and income protection insurance so I think I took that sort of risk into account.
I just thought there was something I was unaware of that you were refering to.
I am still happy with my choice of funding then and see little risk in my situation.
OBIE…
Sorry Gezzy I don't need to hijack your thread but hopefully this info helps you anyway…
Richard, sorry I still don't understand why I would have a problem…
I have 48% equity in my PPOR and about 0% now in my IP… now if my IP due to CG brings my equity up past 20% I should be able to get my IP lender to remove the second mortgage on my PPOR.
If they refuse I seek another lender willing to give me an 80%LVR loan to pay out my current IP lender. I am sure I can find a lender who would like me to pay them $2,000 a month interest.I don't understand why my PPOR lender would object to a second mortgage by another lender being removed from my PPOR, especially when I have 50% equity in my PPOR at the moment.
Maybe I am just misunderstanding your post.
OBIE…
Qlds007 wrote:ObieWelcome to the forum and I hope you enjoy your time with us.
Agree with your sentiment but hate to say it is not all that easy depending on numerous factors
I intend to remove the second mortgage on my PPOR given to my IP lender as soon as my IP gives me a LVR of 80%, this will take a few years.
Thanks for the welcome
What factors do you mean?
If my IP lender does not want to remove the second mortgage on my PPOR I will just refinance them out of the equation.OBIE…
Hi Gezzy,
This is my first post on this site but hope I can help you a little.
I used my PPOR equity for my first IP and it has worked out great.
I borrowed 105% for my first IP using my PPOR equity as a 'deposit'. This covered loan costs and Stamp Duty.
My lender for my IP now has a second mortgage on my PPOR (I have over 250K equity in my PPOR)
In my case it has worked really well as I bought my IP for 415K in Dec08 and it is now worth $435k+ to my estimates from recent sales of the same sort in the same area, without doing any work on the property other then cleaning the gardens up a bit.
My IP is now worth more than I owe, only 6 months after purchase and due to low interest rates and high rents in Darwin it is paying it's way, covering the interest only payments already. (renting for $500/wk)
My advise is……..buy low and reap the capital gains on settlement. I went to over 60 open houses in the area I was looking at buying in and built a good raport with agents in my area. Be ready to buy if you look at a property, have your finances ready, you want to be able to sign a contract if you are confidant that the property is the right price, on the spot. (both my current PPOR and my first IP contracts were signed within 1 day of going on the market and both were for the asking price)
For me using my equity in my PPOR was the right thing to do, but it depends on how much equity you have in your PPOR, the capital growth in the area of your PPOR and your IP and how good you are at buying under market value.
I could have taken $83,000 from my offset account on my PPOR loan and paid the 20% needed to avoid LMI and make my IP stand alone but that would have given me $83k more debt that was not tax deductable and only given me a tax deductable debt of $336k of which the interest would be tax deductable. As it stands I have a debt of $434k on an interest only loan that is fully tax deductable and any extra cash I pay off my PPOR non deductable loan.
So….. I recommend using equity in your PPOR and giving your IP lender a second mortgage on your PPOR as long as you follow due diligance and research your IP purchase so you increase capital when you buy or by increasing capital gains by renovating or market forces in your area.
I intend to remove the second mortgage on my PPOR given to my IP lender as soon as my IP gives me a LVR of 80%, this will take a few years.
I would use it again if I needed to though for another investment.
Hope that helps…
OBIE
Terryw wrote:So you would have loans like this:
1. PPOR of $440,000 = this is secured against your home
2. LOC of $124,000 = this is secured against your home
3. IP loan of $240,000 = this is secured against your IP onlyI think this should read…
So you would have loans like this:
1. PPOR of $316,000 = this is secured against your home
2. LOC of $124,000 = this is secured against your home
3. IP loan of $240,000 = this is secured against your IP only…that is one way you could do it, another is to cross collateralise. Get an Interest only loan for your new IP for the total value + stamp duty + costs which will probably be around $315k. Your investment loan lender would get a second mortgage on your PPOR but I don't see that as an issue with the amount of equity you have in your PPOR. Your IP loan is tax deductable and you won't have to increase your PPOR loan at all. If you buy well you will have positive equity in the IP within a year or two.
This method has worked for me and as soon as you have 20% equity in the IP you can remove the second mortage on your PPOR. You could even borrow more then 105% and just park the extra in an offset account on your Investment loan in case of cash flow problems to cover any shortfall.
Hope that helps you…
OBIE…
pvrpunnad >> Start a new topic, you have posted in someone elses Topic…
Tommygun>> I believe this will help you http://www.oldlistings.com.au/ and it is free. You can only search by suburb but it does give addresses and what price they were listed for. (not actual sale price)
I am in the NT and we have a great site up here that lists actual sale price, but only for the Territory http://www.nthomes.com.auI hope that helps you…
OBIE…
