Replies Created | Forums | Ozboy | PropertyInvesting.com

Forum Replies Created

Viewing 20 posts - 1 through 20 (of 27 total)

1 2 »

Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
May 31, 2008 - 11:06 pm
Linar wrote:
Hi Ozboy
I'm not sure whether a deposit bond will come up on a credit check but if you were able to come up with the deposit yourself, you could absolutely do what you want to do.
As to whether it is clever or not, I would caution against it UNLESS you are a very experienced investor and intimately know the market where you want to buy the new property. How do you know it will go up before settlement? Is the property substantially undervalued now? What if prices don't go up and you have to sell the property at a loss? Could you afford to do this or would you have to sell the established property to offset the loss.
In this market I would urge you not to speculate unless you really know what you are doing. There is no guarantee that prices will go up. You will also have to take into account stamp duty ($25,000 approx depending on what state you are in). That means that the price will have to go up by at least $30,000 for you to break even.
I am a relative newbie to investing, although I have done an incredible amount in the last 4 years. Being new means that I have only ever seen the up side of the market where properties increase. I was talking to my mentor the other day who has been investing for 40 years. He was talking about the times where the market doesn't go up or worse, it goes down. I haven't seen that market yet and I am positive it will come sooner or later.
I think you really need to ask yourself whether you can afford to lose money on the deal. If not, then don't speculate.
Good luck
K
Hi Linar
Thanks for your post, but I dont think you have grasped what I am suggesting.
1) The purpose of a deposit bond is to avoid putting down the actual deposit, so the deposit money can be freed, rather than being tied up for say 2 years while your apartment complex is being built.
2) There is no stamp duty involved when you sell a property before settlement (flipping). The new buyer pays the stamp duty.
I am aware this is speculation, but so is the share market.
Risk can be minimised by undertaking proper due diligence.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
May 31, 2008 - 11:00 pm
Scamp wrote:
Ozboy wrote:
Obviously the plan would be to hope for price increase so that I can 'flip' the new property before settlement
Your plan is the same one as the following :
Al Capone asks you to run some money for him to his business partner. Instead of going to the business partner , you decide to go to the roulette and put everything on 1 color. If you lose, you're in problems, if you win , you're rich.
Ask yourself if the above plan makes sense to you. If it does, then I say go for it. If you even remotely have a braincell or two though, I'd say stay off the drugs and start working instead of coming up with scams like these.
This isn't a scam, this is how many people have made alot of money out of the Australian property market, particularly between 1995 & 2002, when properties were regularly 'flipped' 2 & 3 times before settlement.
Your statement shows you have no idea about the market here & have zero credibility.
If you like, I can educate you on a few things about property investing. Feel free to let me know.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
May 31, 2008 - 9:23 am
Generally speaking, I don't see the point of selling a property in Australian suburbia as there is plenty of years of 'heat' left in the market, if you have a global view of relative property values. You simply use the available equity in your home to buy more property. Buy more property when the properties you own have gone up in vaue & you use the new level of available equity to buy more.
Selling involves costs.
The only situations I can see for selling property is for:
1) cash flow
2) you can see somewhere else where you are fairly sure you can get a greater return in a shorter period of time, AFTER TAKING INTO CONSIDERATION SELLING COSTS OF EXISTING PROPERTY & THEN BUYING COSTS OF THE NEW PROPERTY. Its basically a form of opportunity cost
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
May 31, 2008 - 9:16 am
You would be using a deposit bond rather than $200K, yes?
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
August 23, 2007 - 8:41 am
Tools wrote:
Ozboy wrote:
I can't keep up!! This is only done by the plumbers association (or whatever they're called) lobbying the government to make it law, so they can get more work. They'll provide some illegitimate reason – "…someone fell down 25 years ago & broke their neck, so better leave it to us…"
Installing laserlite is like shelling peas
Can't keep up?? I don't know what state you are in , but in Victoria you have had to be a registered plumber to do roofing for over 20 years.
Tools
Laserlite would have to be 'roofing' in the most loose sense of the word…
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
August 18, 2007 - 2:38 am
Jase and Flic wrote:

Did you know only a licenced plumber is allowed to do roofing? eg lazerlight
I can't keep up!! This is only done by the plumbers association (or whatever they're called) lobbying the government to make it law, so they can get more work. They'll provide some illegitimate reason – "…someone fell down 25 years ago & broke their neck, so better leave it to us…"
Installing laserlite is like shelling peas
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
August 17, 2007 - 1:30 pm
sebsez wrote:
Hi All,
I have a dream! ha! I'm thinking of, within the next couple years moving into a position where I could buy / renovate then sell or rent out property full time. Does anyone else here do this? Is it possible / feasable to do? Just thinking about the figures, in order to maintain a certain lifestyle and afford to continue further investing you would have to make profits of $100K per year for example… Is that realistic? Say doing 5 renos a year, earning $20K profit on each??
I have 2 properties already, which are pretty much positive, I have just finished doing basic reno on one, which before the reno was appraised by and RE agent of being able to bring in $240 P/W in rent, after the reno I have been able to rent it out privately at $300 P/W. And the reno cost me under $2K.
But anyway, my point is that I enjoyed doing this and I would be interested in hearing from people that renovate full time or anyone who has something to share about the pros & cons of doing this, as well as things to look out for.
Look forward to hearing from you all!
Sebsez
Hi Sebsez – your plan is mine.
I renovate after work & on weekends. However, my plan is not to on-sell but hang onto after I move out & rent it out. Australia, even after the 1996 to 2003 property boom, is still cheap on a WORLD scale. And the world is shrinking. Where would you rather live: London or any city in Australia? Exactly! Therefore, expect prices to continue to rise for many years to come.
At the moment, I am 9 months into renovation, with plans to finish in 3. I bought out my ex for $325K & expect it to be valued at $450K when finished (I have been to alot of auctions in the area in the last couple of months & this is realistic). Please note that I only started getting serious with the renovations about 3 months ago, so realistically I have spent 6 months. I expect to spend about $25K, so its a $100K return. Admittedly Melbourne is going through a boom at the moment – Surrey Hills for example has gone up 45% in 6 months. I think this is stock market or mining resources linked though – people investing money they have made & buying property.
I disagree partly with Crashy by the way – alot of doing a tradie's work is in the mind. People are scared of making mistakes. Admittedly my old man, being a tradie himself, has given me pointers at times but most of my work I did myself. Hate to boast but I did a BETTER job than the original carpenter/builder of the back decking, including erecting a laserite cover/canopy.
The decking had to be replaced & it was only 13 years old!!
I did the floating floor all myself & did it the better way by NOT using quad & taking off the skirts & architraves.
Again not putting tickets on myself, but talking with people in the industry – some have no idea about interior design. Simple thing – square door handles & square tap fittings. This looks absolutely shmick, but not many use them. Aluminium framed glass doors – people get locked into two-pac for a stunning kitchen. Etc, etc
Once I move into another property I will do the same. I don't find it hard cause I get bored REALLY easily & I appreciate the fruits of my work. Also I like the fact that I have proven to myself that you don't necessarily have to be qualified tradesman (by the way I don't do stuff that is illegal – e.g: electrical; although I could do wiring, installation low voltage lights, etc. if I so chose)
The plan is that as I expand the 'portfolio' I will employ more & more tradies to get the work done faster, to the point where I have two houses being renovated at once then 3 so on, etc, etc). During this time I might also start buying new properties off the plan, but it depends how the market is.
Also it may be worth selling property if the market is going to stagnate – if you aren't making money on certain properties sell them & buy others that will. Its no different to investing in shares (for a GREATER, not LONG TERM return). That said, property does not have the peaks & troughs of the share market.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
June 26, 2007 - 11:10 am
Hi all & thanks for your feedback.
I have actually decided to go with aluminium framed glass doors. They're a fairly new concept to the Australian market & as such I expect an even better return than what two-pac would give (at least for the next 3 to 5 years, when they become 'yesterday').
I also have a friend who manufactures toughened glass, so I reckon I will be able to make them for at least half the price of what 2 pac would be. The glass will be white painted.
(As such I have updated the forum topic!)
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
June 13, 2007 - 8:44 am
frini wrote:
If it is your PPOR and using the "Temporary absence" rule, you have it rented, then any costs associated with this, like depreciation and interest costs are fully deductable, as if it was an Investment Property.
Whether the improvements were done while you were living there or while it was an IP is irrelevant, it will still be depreciable.
I checked with a quantity surveyor & its deductible (I was sure Handy Andy's statements were not right!)
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
June 9, 2007 - 9:15 am
Handy Andy wrote:
As far as I am aware, any improvements you make to the house while it is your PPOR, can not be claimed…ONCE it is rented, if you do improvements then, you can claim those as a deduction through a depreciation schedule.
How is this different from someone who owns a property that they don't live in, spend 3 months renovating with no tenant, then get someone in to rent & claim the renovations on depreciation? Absolutely ridiculous!
If this is the case, my next property I will create a company or trust to buy, then rent it back to myself
Actually, come to think of it, I could create a company, add their name to the title of my current PPOR & then rent back.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
June 5, 2007 - 8:52 am
Handy Andy wrote:
Um, if you can renovate an IP, you can claim it on your tax. Renovating your PPOR is not very smart for a tax break…I know, I'm doing it right now!
But yes, it is one way to value-add, just pointing out that it would be better if it was an IP…
But if it is to be used for renting then I should be able to claim the works done as depreciation for the time I am not living there? If not, this is illogical.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
June 3, 2007 - 8:39 am
1Winner wrote:
Decking material is designed to be out in the elements and last a set number of years, say 10 years.
Not Modwood. It is guaranteed for 10 years & would probaby last 50 years. Nearly twice the cost of Merbau, but doesn't require painting as the material has a colour pigment. The only downside is it stains & marks easily, but this can be reduced by applying decking oil.
As for typical timber (pine, merbau, etc), painting the underside without removing the panels is going to be useless, as you cannot paint in between the panels & joists where water gets trapped & causes rotting.
If malthoid was put in between the decking boards & the joists, it will reduce the rotting effect, so I would leave as is. If not & you MUST reduce rotting potential, then take the panels off, put malthoid on the joists & paint the underside with two coats & re-nail.
Word of Warning: If the decking panels were attached correctly, they would have used screw-nails which can be relatively difficult to remove, compared with standard bullet nails.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
June 2, 2007 - 1:22 am
Xenia wrote:
What impact would it have on your lifestyle?
Personally, the only things I pick up during a renovation is a pen and mobile phone If you use other peoples time, you can be doing multiples at once, your strategy can only do one at a time with a huge impact on lifestyle.
Trusts are better entities to buy renos in than are companies, but it would take too long to go into reasons. You need advice from your accountant.
Thank you for your reply.
When I get to the stage that I have built a portfolio, then yes I will be using pen & mobile phone, but until then I trust my ability to renovate (I have just re-done the back decking & I did a MUCH MUCH better job than the original builder). I don't have enough equity yet to buy multiple properties – slowly, slowly.
As for impact on lifestyle, I hate to sound cynical but my experience in life is that people who are supposed friends, are often not so & people generally are consumed with themselves (read The Road Less Travelled & Seven Habits Of Highly Effective People to understand where I am coming from). As a result, I don't think I would be losing any friendships. Besides after the renovating I have done to my house so far, I actually find I like it & appreciate seing the fruits of my work (& the kick I get that I can do a better job than a qualified builder). I also get bored VERY easily, so I need to be doing something, even after my well paid Monday to Friday job.
I will look into the Trusts v Companies issue – my father has a Trust. Although I thought Trusts have higher legal liability potential than Companies?? To save you having to go into a long typed out explanation, maybe you can direct me to a website on the issue.
Thanks once again – I appreciate it.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
April 1, 2004 - 11:25 am
Originally posted by Derek:
Hi Ozboy,
If you can only finance one – then only buy one.
Otherwise you are leaving yourself wide open for all sorts of problems.
If your intention is to flip them you will still need to have a ‘fall back’ position available should you not be able to onsell.
Too risky for this little black duck.
Derek
[email protected]
Read my comments? Think I can help you? PM or email welcome.
Don’t worry, my intention is to buy at a ‘discount’, so they have more ‘attractiveness’ to flip.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
March 25, 2004 - 9:50 am
Also, ditch the idea of Science, Engineering, Maths, blah, blah, blah.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
March 25, 2004 - 9:49 am
Try & find anything written by Henry Kaye. Over 1100 properties inside 5 years (as stated before the Federal Court). Regardless of what people think of him, that’s gotta say something!!!
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
March 25, 2004 - 9:41 am
We answered er question without having our own agenda- to fit in with her question.
My apologies. Next time I’ll avoid thinking laterally…..
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
March 24, 2004 - 1:02 pm
There is nothing wrong with renting!! In fact, it is more cost effective to rent (read: lease!!) than buy a property & pour your money into loan interest.
Keep leasing & buy property. I cannot believe some peoples’ suggestion to own-your-own home. Refer sizzling duck’s comment: “…Just imagine your rent over say the last 20 years was your mortgage repayments and see how much money you lost…” (Meatloaf’s song ‘Took The Words Right Out My Mouth’ comes to mind).
A ligitimate reason for buying your own property is to renovate it & on-sell for a tidy profit & avoiding capital gains tax.
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
March 24, 2004 - 12:55 pm
If I had my time again I would have dedicated myself to studying investment & finance. Its all about knowledge. Don’t simply limit yourself to property. Look at the current market, generally shares are getting significant returns, as the property market stagnates. All things being equal, IMHO, more money can be made out of property than shares.
Learn finance inside-out, take a deep breath, PUT IT INTO PRACTICE & you’re set. I wouldn’t be surprised if you were retired by 25!!!
Ozboy
Member
@ozboy
Join Date: 2004
Post Count: 37
March 23, 2004 - 1:23 pm
Thanks guys!!