Forum Replies Created
Hi Johann,
What strategy to take depends on the % of your return, that is your profit divided by your capital & costs for the project. Renovation or development is more active strategy and requires a lot more time commitment.
For buy and hold strategy you can estimate the potential growth in your area and divided that with the equity in the property to get your estimated return. Buy and hold is only good until you find something else that can give better return. All the best.
Hi Maws,
Depending on which state and suburb the cost for unit development can be a lot cheaper than subdivision because you can share the services (separate meter) such as power and sewage. Unit title requirement can be as little as sharing the letter box in the common area. Another thing to consider in your design is to have separate driveway for each dwelling.
All the best.
Hi Barbara,
Tricky situation you have there. What do you think the property market outlook in your area? if you think the growth will be higher than the -ve gear then you might want to consider keeping it until market settles down. You also might be able to borrow more if you dont mind renting one or more rooms from your PPOR.
Hi Jess,
I have tried both doing it myself and through property manager. My preference is to have someone else looking after my property specially if the location is far from where I live. The only time I managed myself was when I had bad experience with agent. 7% sounds reasonable to me.
If I understand correctly, you still have to pay interest for the money you take from PPOR and it is not tax deductible. It wont matter where money goes because we treat them as one portfolio.
Ideally we want to have 50/50 balance i.e. cash flow positive to fund the negatively geared growth property.
However there is possibility to invest in growth area with minimum cost if you can build unit development and sell some just enough to keep one or two remaining unit for cash neutral.
For my own experience I started with buy and hold strategy 10 years ago from unit, townhouse, house and now moving towards renovation and development.
All the best with whichever path you take.
Hi Grant,
Your LMI increases exponentially with LVR i.e. the higher the LVR the higher the percentage. You could ask your lender to provide the LMI table to get better understanding. LMI usually applies if you borrow more than 80% but I know several lenders can go up to 85% without LMI. Westpac is one of them I think. Check with your broker.
As for Stamp Duty and other government taxes there is nothing we can do about this. However these costs will be deducted as expenses if you sell the property.
I always keep my portfolio LVR around 70% – 80%. Anything lower than that I consider lazy money in my opinion but everyone is different.
Best of luck.
Hi Anubis,
Thanks for your info about northern part of launceston. I wonder if any of these suburbs have improved because the rental yield is above 6% in some areas.
try http://www.optionetics.com forums. it is a US based company but same principal can be apply in australia. I find market here is not as liquid as US market. The only broker I know has good facility to do different option trades such as calendar, straddle or butterfly etc is http://www.optionexpress.com.au … another broker to consider if you are trading stocks is http://www.cfd.com.au
I have enrolled in Results 2008. PM me few months later.
hi catsgrave,
I am not an expert and dont know your situation but I was in your situation and bought $180K investment.
Salary $40K gives approx $2500 monthly into your bank.
you can aim to save about $1500 per month if you dont have family or other debt(s).
In 6 months you might have $9000 + $3000 saving + $7000 first home grant = $19,000
you might be able to get $150K – $200K property.
Speak to a broker once you have enough savings and he/she'll tell you the options.
This might sound cruel and boring life but without sacrifice I dont see any other way unless you find a new job.Well done Kean, I wish I had the same courage when I was 14. You can start by reading investing books free from library and ask specific question(s) to this forum while saving for a deposit.
welcome to forum. I went last year and learnt few things. It also depends on your current level of knowledge on investing. I cant speak for others but in my situation I managed to increase my portfolio significantly from reading books, attending seminars and talking with other experienced investors. I wouldnt go to his seminar again not because it is bad but I understand his style from seminar and reading his books. It is always good to listen to different people who has actually done something. The rest is really up to you. good luck
Thanks for your response.
I had a chat with the manager he agreed the property is under valued based on rental income but he can justify the house price based on rental alone. Rental is only derived from house price but not the other way round.
I have just renovated this house internally all brand new such as bathrooms, kitchen and floor. I am learning we can get higher rent from renovation but doesnt mean the house value will increase as much as rent.
Three main factors they are using:
1. land value
2. house size
3. comparable sales with property having similar land value and sizeI am now hoping to find better comparable sales in the area.
Hi V8ghia,
this is a full valuation and I am paying for it then pass it on to Macquarie for refinance. I asked all agents that inspected my property to tell me the comparable sale and also passed this info to the valuer.
deal is off. Vendor changed his mind asking more than agreed price.
thanks.. with my situation using hybrid trust eliminates most lenders. I tried Westpac and they said no. I am going thru Macquarie at the moment but their fixed 3 yr rate is 8.50% higher than most lenders. Not sure why they dont want ppl to fix the loan. I'll try NAB and hopefully they can give me good deal.
you are saying 25% rule is from the insurer and will not apply for 80%LVR?
AmandaBS wrote:Thanks Simon. It was only a basic makeover For those of you interested here goes; Stumper to level and fix $3650 Plasterer $550 Tree lopper $750 New double carport kit $1486 New Laminex kitchen bench top $220 Bobcat $372 Pest Control $187 Skip bins 2 @ 190 = $380 Electrician $1204 New glass shower screen $829 New Security grills $774 Roof repair and paint $990 4 x new room a/cond $1193 New carpet $1920 New Curtains $601 Misc. $5894 (Paint, silicone, timber, gravel, light fittings, plumbing bits, concrete etc) The labour we supplied ourselves "free". Amanda "It is better to be inconspicuously wealthy, than to be ostentatiously poor…"Great work Amanda
do you mind telling me where you bought the carport kit from?
thanks.
Regards,
PatHi,
when will be the next meeting? I would like to meet ppl with similar interest
