Hey Tjay,

Welcome to the forum!
Like what Richard said, unfortunately, there is no lender that capitalizes the stamp duty cost into the loan.
Based on the limited information you have provided, your broker is setting you up for a 97% loan. This is due to the limited cash you have at the moment. Here is what I think is the breakdown of your scenario:

Purchase Price = $250,000

LMI = $6,700 (capped)

Deposit = $12,500 (5%)
Acquisition Costs = $11,000
Cash / Savings = $19,000
Shortfall = -$4,500

Hence your broker is asking you to come up with another $4k. How soon can you save up for another $4-5k? There are certainly some unconventional ways to do this. One is the way knightm did during his early investing days, the credit card option. Not really advisable but if this is the only way for you to get into the property market, and the returns outweights the potential loss in a short amount of time then you can consider these options. I would be very careful though with the property to buy and ensure thorough due diligence is done.

Cheers!

Freedom wrote:

Do you mean selling properties for others Tamara? Because you are allowed to sell your own property without a licence aren’t you?

On this note, how many developers, or investors in Australia get there licence? Are there advantages/disadvantages?

Yes you can sell your own property via private treaty.
Not sure about your other question, what license are you asking about in particular? do u mean a builder’s license?

Hey Colleen,

What does your due diligence tells you? Have you check the prices for comparable houses?
Have you look up the historical data for the area? Demographics, historical growth etc etc..
Gathering these data will actually tells you if the area suit will suit your strategy.

Hey Damo,

I got this from another poster on a different forum. This is from Singo.
He put this extensive list together so all credits to him. Some of the books that he mentioned changed my life for real. My outlook in life is now different because of these books.

Reading books gives lots of ideas. I love reading and collecting books. Over the last couple of years, I have bought more than 40 books on property investing. 7 Steps to Wealth is the first book I read. John L Fitzgerald gave as a free gift in one of his seminars. From 0 to 130 properties in 3.5 years is the first book I bought. Now and then newbies ask what books to read and the sticky we have is 10+ years old. So I thought a list of books I have would be useful.

“This is my Property Investing Library

General
* My four year old property investor (Cam McLellan)
* How to build a multi million dollar property portfolio (Michael Yardney)
* Mastering the Australian housing market (John Lindeman)
* From 0 to 130 properties in 3.5 years (Steve McKnight)
* How to achieve property success (Margaret Lomas)
* Smart Questions Property Investors Must Ask their Solicitor (Robert Balanda)
* Property Investing for Dummies
* Ignite your Property Investment Mojo (Lenore Miller)
* A pocket guide to investing in Positive Cashflow property (Margaret Lomas)
* The investment property plan (Stephen Zamykal)
* 7 Steps to Wealth (John L Fitzgerald)
* From 0 to Financial Freedom (Steve McKnight)

Development
* Profit from Property (Philip Thomas)
* An intelligent guide to Australian property development (Ron Forlee)
* Australian Property Development (Ron Forlee)

Taxation
* Winning Property Tax Strategies (Julia Hartman, Noel Whittaker)
* Property and Taxation (Jimmy B. Prince)
* Claim It (Tyron Hyde)
* Rental Property and Taxation (Tony Compton)

Renovation
* The Renovator’s Survival uide (Amanda Falconer)
* Planning your perfect home renovation (Alex May)
* The Insider’s Guide to Renovating For Profit (Patrick Bright)
* The Beginner Renovator (Edward Mundie)

Property Management
* Managing your Investment Property (Rachel Barnes and Geoff Doidge)
* Simple and Successful Property Management (Leah Calnan)

Investor Stories
* Building Wealth Story by Story (Jan Somers)
* More Wealth from Residential Property (Jan Somers)
* Real Property Real People Unreal Profits (Geoff Doidge and Paul Eslick)
* The Property Millionaires Next Door”

Hope this helps!

• This reply was modified 10 years ago by  PHP.

Hi Karen and June,

If you can post more details about the deal then that would be great so others here can say their opinion about it and you can decide what is the best way for you moving forward.

Have you tried calling your banker or finance person about this? I’m sure they can offer you some advice with this.

Cheers!

• This reply was modified 10 years ago by  PHP.

Good point blackhotel. Properties with strong capital growth is really what makes you wealthy. This speeds up the property accumulation phase and you can potentially reap the rewards in a shorter amount of time.

Also consider diversifying your portfolio, analyse if investing all your money in one high priced property is the way to go for you or if investing in 3 mid price properties will achieve a better result. Again, each person’s circumstances is different so take all that into consideration when formulating your strategy.

Cheers!

Richard wrote:

Earning good money as a day job, along with the stress involved, suggests he would look to make the most of this potential – sooner rather than later. Creating a plan with a defined outcome and time frame might be a better initial move, as this would spell out the most suitable investment for his goals, rather than his tax return.

Exactly! :) Good advice Richard.

Hi There,

Assuming no existing debt and has a decent amount of deposit, with that income, he can start his investing journey as soon as possible. Before doing all that though, I suggest the following things:

1) educate yourself – forums like this one is a good start. ask questions, read more about it and then come back with more specific questions. Some good books are highly recommended. Do a search in the forum and you will find a lot of people sharing books, magazines and other resources that has changed their way of thinking for the better.
2) investing for tax purposes is not really a good plan. it might help you for a short period of time but property investing is not all about tax benefits.
3) start with the end goal in mind and be specific with your goals. You mentioned that he wanted to grow a property portfolio and be financially free, what is financial independence for you? is 70k a year passive income your goal or is it 150k a year? from here, you will formulate your own strategy on how to get to your goal. very important too is to set a timeframe for your goals.

Regarding your questions,
1) paying less tax does not make really make u grow assets. It will help u save faster as u will get more after-tax dollars that you can then use as a deposit to buy properties. this is really not a good strategy. as u read more about property investing, this view will change.
2) I do not know any good tax accountant in WA. accountants are not the only ones though that you should be focusing on for advice. u also need a good finance person on your side that will tell u how much u can afford and will structure your finances to suit your goals. a good buyer’s agent too can help in your search for good properties for your strategy, this will cost you though to employ them. u can also consider going to meetups and just mingle around like minded people around your area.

So yeah, read.. ask… research…

Cheers!

Freedom wrote:

Catalyst, do you happen to know if there are any meet ups in Adelaide, or if anybody could Skype in to one in Sydney? Struggling to find them over here!

Hey Freedom,

I think you will find it hard to Skype in to one of these meet ups. First is they are normally just casual meet ups, no hard selling or anything like that. Just a group of property investors or would be property investors sharing ideas and stories. And it is normally held in a club so people can have dinner and a few drinks while discussing things. I am sure there will be more meet ups in Adelaide.

• This reply was modified 10 years ago by  PHP.

Hey,

Have you considered an equity release from your other property? If there’s enough equity in your property now, you can potentially buy another IP without using your savings with this process.

Regarding the use of credit cards and balance transfers, this is usually not advisable as this can really hurt your credit scoring and all credit applications will reflect on your credit file. this could mean lenders will see you as a high risk borrower with so many credit hits in a short amount of time.

I would suggest talking to your finance person/broker regarding your plan. Give them your scenario and discuss your goals with them, they can give you options on how to go forward with this.