Bruce – yes, there may be many ‘I know thats’ when reading these books. But many times people may know something, but do exactly the opposite, either due to laziness, cowardice or just plain forgetfullness.

It could be anything from quitting smoking to putting off needed repairs, to not doing due diligence.

So if the book gets you to act on…[Read more]

hotchocolate – thanks for your comments re London. Can you comment on trends in the north of England – places like Leeds, Birmingham, etc?

Would prices be lower and maybe even CF+ there?

Peter

Several points spring to mind:

1. If average people can only afford the time to own 5 or so IPs, how do professional property managers, who might manage 100 each cope? Admittedly they’re doing this full-time, and have secretarial support, but if you’re up to 100 properties, you should be able to quit your job (more time) and/or hire a…[Read more]

Haven’t read Building Wealth through Investment Property, but I’ve just finished ‘More Wealth from Residential Property’ which is much more up to date (2001).

In this book shares and property returns are compared, but are much closer together between 1980 and 2000 (13.2% shares, 15.6% property).

I find the (later) book fairly even handed re the…[Read more]

Thanks Doogs!

It seems as if I’m already calculating it right by including the full principal repayment in my figures.

Also a few days ago I rejigged my spreadsheet to include (1) before tax cash flow (2) after tax cash flow and (3) cash on cash return.

I should probably learn more about accounting sometime, but it might just confuse a simple…[Read more]

‘would you buy without knowing the area first (but purely on returns)’

The answer is NO!!!

You MUST get to know the area, starting with at least a couple of months research into the sustainability of the main industries in the town, population trends, vacancy levels, prices, rents, etc. Make sure the town is big enough to support property…[Read more]

My vote is also for the phone.

Recently I asked one sales rep on the phone if they could email me something.

The remark was ‘I don’t know how to send an email, I’ll have to get one of the office staff to do it!’.

I’ve found that many people in sales might be very good at talking and persuading but often lack (i) the ability to write and (ii)…[Read more]

Hi Trevor:

‘Now I understand that with no security such as a house under my own name, I cant purchase an investment property.’

Nothing can be further from the truth! With your excellent cashflow, I would say that you are in an in an excellent position to buy. The property you buy becomes your security. The bank does not care if it’s an…[Read more]

Chris – I’m with Robert K on this one.

Robert K says ‘an asset is anything that puts money in your pocket’.

Does your own home put money in your pocket?

No. Not unless you take in lodgers.

You have to pay rates, insurance, buy furniture, etc for it. And the more expensive the house, the more expensive the costs associated with it.

If you…[Read more]

Hi Shezian – they exist, but seem to sell quickly (and maybe more quickly now with Steve’s book!).

I recently missed out on a 2br flat in a country town getting $105pw rent and costing $45k. I was willing to pay the full asking price, but, buying from interstate, I put in some subject to clauses (building inspection, valuer, pest inspection,…[Read more]

Agree 100% Rich re country areas and cf+ homes in country areas which meet all of Wakelin’s criteria EXCEPT they are in country towns.

I enjoyed reading Wakelin’s ‘Streets Ahead’ and found it gave me lot of useful info, but she is one-eyed towards buying properties only for their growth.

She does not seem to realise that people have different…[Read more]

On a related topic, I’ve just been reading a very interesting passage from one of Jan Somers books re financial advisers. Now I haven’t read this anywhere else, so it bears repeating.

Basically ‘financial advisers’ are chiefly involved in shares and managed funds. Jan points out that their professional education omits property. Thus even an…[Read more]

(pinched from Steve’s book and other places)

It’s not how much you earn, but how much you keep!

Alebarn: I ordered it first thing Mon morning, and by Wed lunchtime saw it wedged in my letterbox : )

First impression of the cover was why use a CBD full of -ve geared apartments (like other property books)? Surely a non-descript country house would have been better. But then I warmed to the cover photo, recognising it as Perth!

Only up to…[Read more]

Politician’s Place Of Residence

But we’ve all learned that this is sometimes different to ‘where they live’, especially when it comes to claiming allowances or (not) enrolling to vote!

Peter

Though I haven’t put this into practice, the idea of buying for cashflow during a boom and buying for capital growth during a period of stagnation somehow appeals to me.

It also ensures comparatively high returns (as you’re never buying properties returning 3-4%).

Peter

Hi Youngie – maybe the problem is more the style of thinking, rather than the fact that you’re thinking (which IMHO is good)? Could you be ruminating on the negatives too much and letting these put you off?

Maybe spend 25% of your thinking time justifying all the positives of a particular area/property/deal. Talk to lots of people, visit the…[Read more]

I think Regina is onto something and it’s already happening.

It’s interesting to look at migration flows, especially into and out of Sydney. Sydney absorbs the lions share of international migrants while exhibiting a large out-migration (mainly of Australian born) to northern NSW and Qld.

These ex-Sydney migrants are on average incomes or less…[Read more]

Before doing anything, I’d be asking myself whether the capital growth is being driven by the fundamentals of population growth/household formation or due to transient demand from mainland investors.

If the latter, consider where your future supply of tenants will come from, and given their high unemployment rate and low average incomes, how they…[Read more]

To correct he previous – it’s ‘Dull Dull Dull’, not ‘Boring Boring Boring’! But the idea’s the same.

Peter