Hi Russ,

If the floors are timber then there is a need for fire protection upgrading.

Pisces

Aussierogue,

Aussierogue, I cannot quite see what is the difference between buying a house for yourself and an investment property.

Kay, unfortunately there is no such thing as 100% safety.

Neither jobwise, or investmentwise or even just crossing the street.

Many years ago a friend was working in a factory and his wages must have been the lowest one could posssibly get anywhere.

I asked him why he didn’t look for a different job elsewhere. reply was : “I have been there for 13 years so I have at least job security. In a new job, who knows what can happen.”

Well you wouldn’t want to know, four months later he was out on his ear because the company put several hundred people off.

So much for job security.

As far as getting another job, many quite capable people just cannot find one because they are too old ( a mere 40 years will qualify you for that category).

Seeing that one is right now either paying rent at the moment or living in one’s own home, what is wrong with (buying and/or) doing the place up and moving around a bit every couple of years (or at least until the time comes one’s wife says “I am sick of it all so no more moving or else”

Pisces

Well, what about buying a home to live in, doing it up and selling it and not paying tax because it is your own house, Aussierogue ?

If one can time one’s sale with a simultaneous purchase of our next house (in need of renovations) the only risk that I can see is that our purchaser doesn’t proceed with the purchase.

Pisces

Russ, Kay, if you have another look at the post which started the thread you will see that it isn’t about I buying a house so much as a discussion of how difficult it is to buy a house and make a reasonable profit on it.

I also hoped that the discussion would thence evolve into a discussion about another (real estate) approach of making money.

My words at the end of the post make this very clear when I said :

So what is the solution ?

Yes, I do have some ideas but it wouldn’t be a bad idea to first hear what others have to say.

Terry was kind enough to make some helpful remarks and you, Russ, also suggested that converting a block of flats into units perhaps may be a better way (of making some money).

Now, to address some of the other remarks you made Russ :

I agree that based on the figures quoted the profit isn’t worthwhile enough to go into the venture. That was the very conclusion I made in the post.

However, I had in mind finding someone to buy it on a wrap basis which therefore would make it worthwhile.

Wouldn’t you be better looking at other ideas that would be a little more lucrative ?

The whole idea of the post was that very purpose (i.e. finding/discussing a better way of making money).

Looking at the example which you brought forward (converting flats into units) I doubt I would ever be involved in buying flats costing about 77K each.

I am not saying that it isn’t a good idea. It is just that, personally, looking from a distance, I wouldn’t entertain that particular idea.

Basically because one couldn’t build them for that kind of money which makes me think that there is something wrong with the concept (or that they are too old and dilapidated).

If they were a good proposition they either would already in all likelyhood have been grabbed up by someone or in any event the asking price would be a good bit higher.

It is just that I would feel very uncomfortable about buying in a smallish town.
(It doesn’t necessarily follow that one cannot make money doing so. I am well aware that many people here are rather active in such kind of towns and appear to have done well).

To answer your question Celivia, one doesn’t get automatic council approval. There could be many reasons why Council may not grant consent to strata title.

Firstly, in all likelyhood an older style building wouldn’t comply with fire regulations and one may have to spend quite a large amount of money to make the building comply. Once one gets some quotes it may no longer be financially viable to spend that kind of money.

Other reasons may be that Council refuses to give consent because there isn’t sufficient parking on the site. Another reason for refusal could be that council in their wisdom feels that they shouldn’t give consent because it would remove a number of low cost rental accommodation from the market.

A developer would normally insist on there being a condition in the contract stating that the sale is subject to council approval being obtained.

Thanks for your response Terry.

It doesn’t however look to me as if Capital Gains tax comes into play. Any profit one makes would be classfied as taxable income.

>>A flip would be substituting another buyer before going unconditional -saving you $12,500 (in some states anyway).<<

As far as I understand that avoiding of a second lot of stampduty certainly cannot be achieved in NSW at least (unless possibly if one had a buyer in place together with an agreement in writing) and even then it would most likely be disputed by the stampduty office if there was even a whiff of something possibly underhand going on.

And, yes, that stampduty is what bothers me a great deal. Perhaps better to start looking around in Queensland ?

Eitherway it will be hard to make a profit in a falling market unless you can resell or flip quickly. Maybe you need the buyers ready and waiting before you find the property.

Well I don’t think the market (On the Central Coast at least) is exactly falling like a stone.
It seems as if some sales are still taking place.

But yes, lining up buyers beforehand isn’t a bad idea at all.

Regards,

Pisces

>>”Looking forward to the day when I can tell the boss where to go”<<

Myydral, if you want to speed up the process tell him right now. [wink]

Pisces