Forum Replies Created
Hi Paul the downside is that even as a British Passport holder there is no lender who will consider Non resident loans in the UK so you would need to be paying cash for the property.
I have 1,2 or now nearly 47 investment properties in Australia so as i spend time in the UK and Europe each year i am always looking to add to my portfolio in SE England.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Just remember make sure your Broker knows the transfer should be done at market value too ensure your parents do not loose any of their centrelink benefits.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Both areas have their merits although it depends on what you are investing for.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Welcome to forum Woollysmum and i hope you enjoy your time with us.
Stick around, ask lots of questions as most of us don't bite.
It is never too late to start investing in property.
I have dozens of forum clients in a similar position to yourselves who are just starting out.
Certainly as Catalyst mentioned it is addictive i can vouch for that.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Sure gaylet she went in to hospital yesterday so was out of action for a day or so.
I have just sent you her details by private message.
Just have a look in your inbox.
Hi Woolysmum let me know if you would like me to send you Jacqui's details also.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi gaylet
Welcome to the forum and I hope you enjoy your time with us.
Why not shoot Jacqui (JacM) from the forum a Private Message and get her on board.
She is very well respected and a long standing forum member.
She I based in Melbourne and assisted dozens of my forum clients with their investment property purchases.
Let me know if you can't find her details and I can send them to you.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Paterson
I agree everyone has to start somewhere but i have to say it is expensive to make too many mistakes.
No structure is perfect for every situation but you want to set up a structure that has flexibility yet can work with you as your portfolio builds.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Patterson
Not a silly question at all and one that most investors have no idea of.
Let us assume you purchase a property for your own occupation and take a loan of $500K secured against.
You pay down the loan down to $400K and decide to rent it out and buy another principal home for $500K.
You decide to access the $100K equity in the first home as deposit.
The problem is the $100K is now non deductible as it is being used for non investment purposes.
Had you set the initial loan up as an interest only loan with an offset account (Appreciate most lenders in the UK don't offer such products) you would still be paying interest on the $400K ($500K less $100K in offset). When you decide to move out and rent the property you withdraw the $100K from your savings and use as a new deposit on your new PPOR.
The interest on the first loan is now charged on the increased balance of $500K increasing your deductible interest accordingly.
As interest rates increase over time having your Broker structure the loan correctly can make a big difference.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Paul
Welcome to the forum and hope you enjoy your time with us.
Always glad to see another Pom on the board especially with how the cricket went in Brisbane.
I am actually in the UK at the moment and certainly looking at picking another property or two over here.
Anyway back to your enquiry.
Certainly a Defence Housing home is an option for a new investor who wants a no worry investment with guaranteed tenant however you have to consider the downsides.
In the main these homes tend to be in areas that have lower growth due to the location and the ongoing management fees are considerably higher than a standard Letting Agent.
The other thing is you need to understand that the sale price and the valuation can be different.
I have financed a number of these for clients for them to find out that they have overpaid for the property and of course can only borrow against the purchase price or valuation whichever is the lower. You could find it takes a number of years for the valuation to get back to the purchase price.
Personally when starting out i would suggest a lower cost investment combining a healthier yield with capital growth potential.
Realistically you are going to be limited to a maximum loan of 90% of the purchase price / valuation (hence my comment on valuation) plus the acquisition costs i.e stamp duty, legal fees etc.
On a purchase price of say $450K and depending on the State you may well find you need a deposit of circa $65K +.
Quick summary of how negative gearing works
1) Add the gross income from the rent to your current PAYG income.
2) Deduct from this total all of your expenses i.e interest, Council Rates, insurance, property management expenses (all of which are a cash expenses) and then non cash expenses such as Depreciation and Capital Allowances.
3) Your Tax is now recalculated on the adjusted income figure.
Remember any loss is only offset at your marginal tax rate.
Personally i prefer positive geared properties or at least neutral geared properties.
You cannot live of potential capital growth but you can certainly retire off rent. (Trust me read my API article).
Not trying too put you off but i think it is the sort of investment you need to go into with your eyes open and understand the downsides.
It is not the sort of investment we would recommend to our clients.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Must admit i can't actually remember ever being employed.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Alistair Perry is Melbourne based a and a specialist in Development Finance.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Charlotte which lender did your current broker advise and why?
From what you told me by email i have an idea who i would have recommended especially with 100K deposit but always interested to hear what someone else in the industry recommends.
Just ask your Broker do they own a property or two and then secondly do they owe anything on them?
We can all buy a property and gear 110% but when you can live off the rent because owe nothing on them that is different.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Ronaldo
Thanks for the great web link.
Hope you don't mind if i give it a miss as i can get similar returns for me and my clients in Australia.
Very little risk and if they wish to gear they can do so.
More than i can say for the USA.
Now bobaaaaaaa i would have thought making sure your money ends up in the right account is the least of your concerns as presumably your Lawyer will be doing the relevant Title checks and taking out insurance accordingly.
Assume you have factored in the exchange rate, US Taxation and the entity you will be using to buy the property in. US Public Liability is not as forgiving as it is here in Oz.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Yes i agree with Jamie.
I employ my own PM for my properties but if i used a Property Manager employed by a Real Estate Agent i don't think i would happy if they handed out my details to other landlords.
Sure there is Privacy issues to overcome.
Plenty of other ways to check out a PM.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Tiger
Hate to say they have all have their own pro's and cons for so many different reasons.
I guess it all boils down to your own goals and objectives
Without actual numbers it is difficult to comment.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Certainly agree and can't see a particular problem in buying multiple properties in the same suburb if the fundamentals haven't changed from the initial acquisition
In 1998 a bought a house in an Inner Western suburb in Brisbane.
Started to perform well so i bought a block a block of 24 units in the same suburb.
Now some years later i wish i had bought another 25 properties in the same suburb as they are have gone up over 350% in the last 11 years.
Certainly i agree with Jacqui that when a so called expert or well known property celebrity tells me to buy in a particular town i look to exit myself.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Thanks guys appreciate it.
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Richard Taylor | Australia's leading private lender
Great in theory just that valuers, lenders and mortgage insurance get in the way of it be more than that.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Sure Michael be back mid January.
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Yours in Finance
Richard Taylor | Australia's leading private lender
DK not saying money can't be made but it is not an area loved by the mortgage insurers.
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Yours in Finance
Richard Taylor | Australia's leading private lender
