I agree that anything above 0.75 USD is a good buy. The USD has regained strength in the past few monthly both with the USD being used as a safe haven currency tied with the RBA lowering rates making the Aussie a less attractive currency. The AUD's weakness in my opinion is greatly tied to the slowdown in China and therefore there will be more opportunity to get into the property market in Australia with lower mortgage rates and potentially lower prices.

From my previous evaluations of cashflow properties in Australia, the potential properties were quite few. The continued declining trend of interest rates should change this an create new opportunities.

2010 – For me was a difficult year to find property in Sydney that made sense from a risk reward perspective. The older posts are valid on why there is so much more interest to invest overseas..

For me in 2010, my focus has been abroad in Canada which has a stronger conservative banking system than the US, but still affected by the GFC. The interest rates have been quite low.. with rates as low as 2.25% on variable mortgage rates. Unlike the US market where the mortgage rates are low but no one qualifies for them, Canada provides the loans at  low rates to people that pass a similiar credit assessment process.

I picked up property in Canada with a 5-7% yield and mortgage of 2.25%. The Australian Dollar / Canadian dollar has been quite favorable at 25 year highs so it made sense to move some money over and invest in a long term positively geared property.

This year I will focus on Australia.. maybe in NSW where I can find some growth areas that are close to neutrally geared..I'm still not sure about the capital allocation required to breakeven with rising interest rates in Australia. Especially if the Aussie dollar keeps rising.. it will make more sense to look for international opportunities.

Depositing money to a USD account for Citi requires fees? That could be because the USD account is still and Australia account. In that case Judith.. you are right the property manager would have to have an account or do what I did in the beginning of my investing career… get property managers to post checks and you can deposit them into the account when it gets to Australia.

Hi Speedy

Your response sounds a bit aggressive.. not sure if it is just online forum messages affecting the tone of messages. So, forgive me if I have misread your tone, but in my view it is a bit aggresive to accuse me of missing the point instead of requesting clarification on how it saves money.

Why would it be worthwhile to have a bank account in Australia in USD when the property is in the US.

Well, it is more cost effective to have a global bank account say with Citi since fees are waived up to 10,000 as quoted on their website:

"Citibank Global Transfers
Transfer money around the world in a blink of an eye with Citibank Global Transfers

You can also look into getting a USD account with Citi Bank in Australia. I really like using the fully automated Currency Online to convert money from AUD to USD or AUD to CAD.. since I'm Canadian I often move money to pay down mortgages in Canada.

http://www.currencyonline.com/ef/1324/default.aspx for those that are interested. Great program.. they have been around for a long time and more efficient than their live broker version HiFx.

For me, my mentors have always been people who were referred to me from my close network. In addition to the networking, my mentors have always been transparent about their past transactions and portfolio. This helps understand whether their strategy aligns with yours and whether you want them to be your mentor.

I'm from Canada so my experience is slightly different.  All of my mentors were investors themselves and had a long track record of greater than 5 years and were open to discuss the numbers and process of acquiring property and managing. All of them have been free. The question you may have is then what do they get out of it. I found that these mentors were passionate about real estate and did not worry about instant reward for their time. I was able to challenge their ideas and also present other opportuities to them and it became more of a team effort to help other grow instead of a short sighted view of immediate reward.

I know there are alot of paid services in Australia.. and maybe seem a bit sketchy and I would try the free route and be in control of your purchases and save some money. If it all fails then maybe pursue the mentor companies. It's been 7 years of investing and I have been tempted many times.. but glad I stuck with free route..

I would agree with Andy in saying only one or two of Kiyosaki’s are important for the reader who is interested in getting into real estate investing. The mindset change is what is most important in creating multiple streams of income, whether it is from owning small business, investments in shares/real estate, self-employment, or employment.

I found his success stories book quick handy in helping people understand the types of deals that are available if you look hard enough. The other book would be his main book “Rich Dad Poor Dad.”

I’m 27 this year and I read his books 11 years ago and began investing at the age of 21 in my first property. I would say there is value in his books on changing people’s mindset on not being an employee for the rest of their lives. Similar to other things in life, it’s important to review various specialist/gurus and form your own opinion on the strategies that suit you. Russ Whitney and Robert Allen are commonly criticised for their products, but there is some truth to what they preach and I would not have bothered investing in real estate without having read up on all the available strategies and then picking on. For me, it has always been purchasing revenue property below median house prices with high yields to ensure positive cashflow. The results have been good even through the GFC where property prices continue to rise (maybe not as quickly) and the positive cashflow is used to offset interest but also act as a buffer/contingency fund in case of future vacancies or repairs.

For those interested in other books, I’ve created an amazon reading list on my real estate investing in Sydney property blog.

Yes, I agree with the earlier posts above. When evaluating investment property it is important to consider all the ongoing fixed and variable costs to understand the bottom line. This include pre and post tax numbers.

I have found it useful to have spreadsheet setup with standard costs of purchase and ongoing management to quickly assess the returns/yields of the properties. So properties that have high yield and low resale may be within your investment strategy which means you will be holding onto it for the income.

I've found the following cashflow calculator useful: http://www.sydneypropertysite.com/p/tools.html by Powereval.

Be careful with serviced apartments and student housing. The yields can be quite attractive since the price of the properties are slower in comparison. The financing of these properties may be more difficult since the size of the unit generally is less than 50 SQMs. A larger down payment may be required and you may have issues reselling to another buyer. This may be why these properties have not appreciated in value as much as units 50sqms or larger.

The 50k in my opinion is a decent amount to buy a unit that would be large enough to satisfy conventional mortgage requirements. Buying a property for your child is great for them to have as it appreciates for the next few years.

Refer to RPdata on Australian suburbs to get an idea of purchase costs and yields across the country. Here is a link of the report distributed by CBA prepared by RPData: http://www.sydneypropertysite.com/p/sydney-property-resources.html

Cheers

Does anyone know how interest rates differ for commercial property versus residential? Also, what are the LVRs for commercial property?