I was in Geraldton in late August. The following is my explanation of why the median sale price dropped in that quarter.

Local agents told me that things were quiet until a few months ago. When I got there I was told that one investor from the eastern states had just bought about 20 houses in one go. The investors concentrated on cheap…[Read more]

Hi C2: It sounds as if your parents were conscious of their success, knew the values and mindset that gave rise to this, and brought you up in such a manner that those values were transferred to you.

Values are probably the biggest gift that a parent could give, and I’m not sure how common it is for parents to think about subconscious values that…[Read more]

Future$ wrote:

‘You’re right, kids ARE adaptable and I certainly see nothing wrong with children learning about investments etc from an early age.’

The most important would be the very simple parental utterances when shopping. The three that dominated my childhood were:

1. ‘we can’t afford that’
2. ‘we don’t need that’
3. ‘it was cheap so I…[Read more]

Hi Future$

Yet another thing to consider is the type of parental influences you want your kids to have.

If they come into the world once you are wealthy, they may not observe you scrimping and saving during their youth.

There is a risk of them: a. turning out spoilt brats who don’t move out until age 30, b. continually asking mum and dad for…[Read more]

An interesting idea Andrew!

My wariness creeps in when ideas for new managed funds come late in a boom.

As a BT investor (in a fixed interest fund) I was bombarded with ads to join their new TIME managed share fund a few years ago. TIME stood for Telecommunications Information Media Entertainment, and you know what happened to IT shares in the…[Read more]

C2 wrote:

‘No paper work is taken out of this area and read else where’

Such common sense, but never have I seen this written anywhere else ; )

But what a difference this one thing would make!

Even if you’re a messy type, this narrows down where you can ‘lose’ things. Instead of finding a needle in a haystack, you might only need to find it in…[Read more]

Monkey wrote:

‘I think we are disadvantaged here in Perth a tad though with the vastness of travelling and lack of areas to focus on.’

Naaaah – I reckon that sounds like an excuse more than anything ; ) Maybe it’s the ‘grass is greener on the other side’ syndrome, but I envy you!

Just pity the poor Victorian or NS Welshman for whom it’s…[Read more]

Hi Anch – I wouldn’t have all my properties in a mining town, though the yields can make having some properties there attractive.

I would choose a large regional mining centre with a variety of companies, rather than a smaller one-company town. Also if there are other industries in the area (tourism, pastoralism) then that would be a bonus.

To…[Read more]

Hi Bill: I must confess that you’ve lost me in places:

‘Over a period of time as you notice the numbers increasing and maybe appearing to peak…time to leave the Party.’

So more ‘to let’ ads mean more vacancies.

Which means that there’s fewer tenants, more first homebuyers, population decline or maybe a glut of new apartments. Or it could be…[Read more]

If interest rates reach 10%, almost all currently positive or neurtral properties would become negative.

But I would much rather be paying the small difference between 10% interest rates and the 8-9% yield on my regional city properties than between 10% and the 4% typical with a capital city property.

The tax back would be less, but then less…[Read more]

Why not do some quick research on the town and if it’s OK, put in an offer on the property subject to building & pest inspections, etc? If you’re brave, maybe putting in a low offer that you know they won’t accept buy you a little more time to do DD?

Your question raises some interesting ideas on the order that we should do things.

I have done…[Read more]

Hi Mini – very thought-provoking!

I don’t see anything wrong with having an out before something goes unconditional.

But shouldn’t the ‘out’ be on the grounds of something that’s stated in the contract (eg an unsatisfactory building inspection) rather than just anything made-up? But if you find out something bad about the property that…[Read more]

Malcolm:

‘I never thought about buying some property in a country area.’

It’s worth some thought. But not just any country area. Do your research to make sure there’s tenant demand, low vacancies and the place is growing. Research is even more important for a country property than a metro one IMHO.

‘I just thought, because of the growing…[Read more]

Hi Malcolm – that $1100/fortnight is a great result and probably puts you in the top few percent of the population when it comes to saving []

The next step from saving is investing. You need an investment strategy that helps you achieve your goals and has a risk that you’re happy with.

I like the idea of a portfolio that has property, shares,…[Read more]

Agree with everyone that Kiyosaki’s strength is developing the right mindset. His major contribution (through books & Cashflow) is to impress on us the importance of shifting your income to passive sources and away from your job.

But some of the detail is a bit dodgy. For instance he mentions something about making contracts ‘subject to…[Read more]

Though it’s mainly young singles that now share houses, I suspect that economic necessity will increasingly force (mostly) widowed older people to share 4 X 2 houses in the suburbs.

Others might be forced to take in (not necessarily young) lodgers rather than sell up, as these give sustained cashflow.

With fewer kids, 4×2 houses will be less in…[Read more]

Hi Fudge

Several things come to mind.

1. If you buy 4 properties at once, you may be out of the market for a while due to finance constraints. This has several consequences:

a. if there is a crash you’ll miss out on bargains
b. if a good deal comes up you might not be able to take advantage of it
c. all properties will be bought when you are…[Read more]

Hi Mini – heaps of ideas!

My purchases have all been when the vendor has been elsewhere, so I’ve only ever seen their agent, so it’s all been on dry stuff like yields, tenantability, location, etc.

But you’ve taught me that it’s the vendor selling, and that there’s a need to connect with them if you are going to get what you want. If the vendor…[Read more]

From Webster’s book of Common Phrases:

‘Dutch Auction: an auction in which the auctioneer starts with a high price and reduces it until someone puts in a bid’

Wonder how that would work with property?!

Peter

Interesting variations between what we do.

Everyone agrees with dressing down.

Acting naive might be fun to catch out shifty agents, but isn’t it better to convey a professional approach? But professional must equate to ‘hard nosed and knows the market’ rather than ‘lots of money from the big smoke’.

So no analysis software, but a calculator…[Read more]