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No worries, looks like they have really picked up the pace in there over the last week or so – houses and earthworks going on left right and centre.
Happy 30th post from one 30th poster to another!
One other thing I have found with these courses – Even if you don't end up going fully into their prescribed methods and becoming a student and going the whole hog – there is still often a lot of good info that can be taken away from the course and used to augment your own methods. Even when so heavily overpriced there is still good info to be had and, of equal value to the course itself, i found was the simple networking and chatting with other like minded people on the course – plenty of good info to be had there too.
Tamara43 wrote:Hi Rhino, Just a comment about people charging $3000 vs $300 for their intellectual property….. Courses cost money to put on: 1) There are ADMIN costs for all the material (including folders, photocopying notes/booklets, equipment required, prizes etc…) 2) STAFF costs – staff need to be paid to co-ordinate all course material, course bookings etc… 3) VENUE costs – room hire will be dependent on number of people attending, time of year the venue is booked, the location of the venue etc… 4) GUEST SPEAKER costs – this will vary and they need to be paid for attendance (eg: Lawyer fees for attendance) 5) COURSE SPEAKER costs – will depend on how much the speaker values their time and how much they cost their time out at 6) FOOD/DRINK costs – for 300 people that attend it can be quite pricey even for simple finger food (again dependent on the venue chosen) I'm sure there are other costs, but as you can imagine this all adds up. For a 3 day course this actually seems fair to me, especially if: a) you also receive a CD of the full three days which you can review over and over again at your leisure (actually there's another cost in itself to produce then send out to all participants), and b) you get to attend a really nice cocktail event on one of the evenings. If you can do all that for $300 pp…..and still be in business…..I'll take my hat off to you! I'm sure Steve McKnight would agree with me too. Cheers, Tamara300 people x $3000 each = $900,000
Even going to a 3 day course with guest speakers and cocktail events it seems to me there would be a fair profit margin here.
I have been to courses and seen courses advertised that are 1 day events, with no food and drink, no cocktail events and with only the main speaker with a few admin staff and they are charging this same price. That has been my experience. Granted, the course you describe above would certainly go more towards being worth it's money. I was not targetting Steve or Rick specifically as I haven't been to either of their courses. It was more a comment based on the courses I have been to and others I have seen advertised.
It just seems to me that a number operators running courses at these prices seem to be taking advantage of people. If, as they claim, they are making so much money using their advertised real estate method, why do they need to crank out more large profits from the courses that are touted as being run due to their genuine interest in helping others learn the techniques. If they have made their fortunes and have no need of extra money outside what they are already making, surely the courses can be run at cost??
Anyway, we're probably a bit off topic here.
I'm all for open minded thinking when it comes to property investment – especially where you can undertake methods that cut out the banks, such as some of Rick's do. I hope you're endeavours are going well.
I just get a bit cranky when i see spruikers coming in and tainting things for those that are genuine with what they are doing.
Hey Tamara,
I appreciate your position, I know you said previously that you had a go with traditional Real Estate methods and it didn't work out. It's great that rather than give up, as many do in a similar situation, you have taken a proactive stance and continued to work to find a method that works for you. I have great respect for anyone that recognises that they can improve their situation and then goes after it.
I was not asking specifics to have a go at you in any way, I am just interested in hearing Rick's methods in a bit more detail from people other than Rick, who have made them work successfully. You had a number of posts in relation to the topic so i was just keen to hear more about how you have gone with it so far. I will follow up further with suggestions you made in the other thread.
When i read back over your original post here regarding the fact we should support each other more – I agree. One way of supporting is for those with lots of experience in particular fields to share their knowledge. I am by no means an expert in real estate, but I have had numerous experiences and investments over the years and i am happy to candidly discuss my experiences (good and bad) with others who are seeking knowledge. Having been to various seminars over the years(including the odd $3000 one), I have become sceptical when i see someone being touted as an all around great guy/girl who just wants to "share" his/her knowledge and "teach" others, but then feels the need to charge $3000+ per seat to do it. If they are doing it for the money alone – then surely (if they are so successful at making money from their field) they would be doing that instead of teaching. If as they say, it is not about the money, but about helping others, wouldn't a $300 ticket be more appropriate.
To summarise – I wholeheartedly agree in your suggestion that we should support each other in real estate investment both traditional and otherwise, I just feel we should be able to do that without the need for exhorbatant fees.
Comments that are wise beyond your years. With that attitude and mentality, you will achieve success, because you will find the method that works for you and then act on it. Great to see people in your age group thinking about their future, keep it up!!!
Congratulations – you're on the right path. To be thinking about this at your age is going to put you well ahead in life.
As well as all the reading – find anyone who has had anything to do with any sort of property investing and question them mercilessly. You will get a huge variety of methods, with many claiming theirs is the best way. Take it all in, think it all over and when you're ready, follow what makes the most sense to you.
Good luck
Tamara43 wrote:Hi Catalyst You also made a good point re: Dymphna. I'm actually surprised at that. I think she is more of a buy and hold type of person. I'm sure Cherie Barber would have something to say about her comment. Ah hello…..the woman has made millions from that strategy so it's gotta work! I was also disappointed when I attended a Metropole seminar with Michael Yardney a few months back, who point blank indicated that no-one will buy a place from you if you offer an Option. Really? I think I closed off at that point to anything further he had to say. Creative Real Estate is using the Vendor Finance process in some way to buy/sell property. It might involve buying a house at a discount through the traditional means and on-selling using either an Instalment Contract, Deposit Finance or the Rent to Own process. Or alternatively buying for $1 and using a Sandwich Lease Option – which I'm utilising at the moment (due to my own financial and employment situation). I'm also considering Joint Ventures with private sellers who may be having issues selling their homes. Again, assisting them to sell with either one of the above strategies can be employed. Hope that helps to explain…..cheers, TamaraHi Tamara,
I know you are a big proponent of Rick's methods – and it seems apparent that he has made a success of his methods. Do you mind me asking how many separate deals you have successfully completed using these methods? Have you managed to replace your income with the success gained from these methods? I'm not asking to be negative at all, as I can see that given the right factors his theories seem sound, just interested as I have often listened to people who are very excited and talk with great authority on a particular method but when you dig a bit deeper it turns out they are only part way through completing their first deal and are still predominantly caught up in the hype from the seminar.
Over a number of years I have invested in a range of different types of property using differentt methods and strategies. The one thing I like to do before going down a particular path is to pick the brains of people who have been regularly successful at that particular field. As I am currently looking at Rick's methods I am keen to hear any info on your or other peoples experiences.
Don't forget, when you talk about different methods of gaining success, as well as your method, many many people have also had success using traditional methods too.
Cheers
Rhino
I am just about finished this book. I own and have read dozens and dozens of real estate/ investment/ money books and I found this to be one of the most frustrating. The first 2/3 of the book were spent on vague generalisations, with every chapter telling me about how this book was going to teach me the 'how to's' of his strategy, without ever actually doing it!…………..I shouldn't say "never" – eventually, near the back section of the book it did get into specifics, but there seemed to be a number of ananswered questions apparent for anyone who has a reasonable degree of real estate knowledge and experience.
Like a number of other strategies that can be used, I have no doubt this will work – if you have the right mindset, apply yourself to the max and ensure you do thorough research and get proffessional legal and accounting advice throughout. With so many strategies out there, it really is horses for courses. Personally i may use some aspects of this strategy to enhance my portfolio, but there are plenty of other options that are not quite so complicated, with great returns.
siewlin wrote:i'm still waiting for the agent to reply regards the property size.
This is fairly important with units – often banks can be reluctant to lend on smaller than 50sqm, which, while you may be comfortable with that, it can affect your ability to re-sell down the line when less buyers can qualify.
If you're using a property manager you would want to estimate approx 10% of your rent to be safe – in your case = $1404. That brings your CF down to $319 just by itself, without including a budget for repairs.
We have several units and while they can look PCF on the surface, you really need to do your research on all the possible fees – body corp fees and rates alone can make a big dent in a budget on a cheap unit. That said, it is still possible to find truly CF positive units if you do your research. Try doing the same figures on a range of property types and go with what you're comfortable with.
If you're talking about your Gladstone place, despite the current drop, it is still a booming town with plenty of diverse long term industry and the property market will balance itself back out in time. If you end up not being able to pull out, the place should still be a reasonably stable long term investment, the gains just might not be as quick as initially hoped for.
BTW – they seen to be moving again in Oasis – 7 or 8 houses now up.
Cheers
Ryan
It can work sometimes – I have done a 1 into 2 block with a tennant in the house where I had to remove a part of the laundry and also do some other renovations (not to mention all the civil works, fencing etc) . I told the tennant up front what was happening and gave them discounted rent for 6 months. They were happy as they got 6mnths disounted rent for a few weeks of disruption, and I got to to keep income flowing the whole time. Win/ win. Would not work all of the time but if you're at the buying stage have a chat with the tennants in prospective properties when you're looking through and see what their attitude is.
Good luck
That's the thing about purchase contracts that many people don't realise – They are not set in stone and every part of it can be negotiated. In an ideal situation the contract can be varied back and forth until both parties are happy with the terms and are equally protected. If you don't like the terms you are being offered send it back with some changes until you either walk away or get the terms you are happy with.
No, pretty sure it doesn't work that way in Australia. I think I heard at one stage that it was a method that is allowable in the US (could be wrong). I think I remember reading about the investment strategy of negating CGT by using the profit to purchase another investment, and constantly upsizing as you go.
Fairly certain it doesn't apply here. When you sell an item after making a capital gain from the amount you paid, it automatically triggers a CGT event.
Luckily if you plan it well, make good use of timing and utulise a good accountant you should be able signifigantly reduce the amount of CGT you are liable for. First priority is, as Rick said – hold it for longer than 12 mnths and automatically reduce it by 50%. It can then vary greatly as to how much further you can reduce it, depending on whose name or what structure the property is held in and their tax bracket in the year of sale. If the owner has made other losses that can be utilised or carried forward from previous years you may be able to further reduce it.
I have found through experience that if you want the maximum tax benefit from any sale of an IP, you need to plan the sale carefully, sometimes well in advance. With good planning you should be able to reduce tax effectively. Don't forget it is a fine line between tax avoidance and tax minimisation. You don't want to be caught on the wrong side.
The way I look at it is – if I'm paying tax it means i've made profit, which is the whole point of an investment to start with.
All the best
Hey Tamara43, thanks for that. I've got books on most R/E subjects, including some that touch on this topic briefly but don't fully explain it. Will get hold of that book and have a look at the website.
Unfortunately not in Sydney – am in central QLD. I don't mind doing lot's of legwork when it comes to researching and putting together IP purchases, but JV is always something I would consider in the right circumstances. I will have a look at your suggestions. Am looking at RTB as an option to help some family members get a leg up into their own home, so hopefully might be something I can use.
Thanks again.
Some good info here, We have been looking at this option for a while but haven't had a lot of info on it. We would be keen to buy a property and then offer it as rent to buy. Is there a particular book or other resource people can suggest that covers the how to's on this?
Where is your IP situated?
Yep, I have had similar in the past – usually seems to occur when supply exceeds demand and vacancy rates are going up. Puts the tennant in the drivers seat as they know that if you don't agree they can walk and get a better place for cheaper rent elsewhere. Sometimes it's a bit of a bluff as they are the ones that will then have to pack up all their furniture and go through the 2nd most traumatic event in life aside from a wedding (moving house!). On the other hand if they are a great tennant who looks after the place and pays on time it might be worth lowering rent to meet the current market as an alternative to losing a great tennant and having an empty property.
Don't know if you're in a position to, but I would include a visit to the town you end up choosing prior to sending any offers away. While I have bought the occasional property sight unseen, it has only been when i was very familiar with the market, or engaged a buyers agent that was. Most of the time when I do all the research and settle on a town, the next step is to visit and stay a few days. You can learn so much more about a market by being on the ground than you can by reading about the place.
Good luck with moving forward.
https://www.propertyinvesting.com/forums/property-investing/help-needed/4345064
Hey Daniel,
I live and own a place in Gladstone – have a look at this thread for a bit more info.
Cheers
Geezzzz, there'd want to be some hope.
We owned a duplex there several years ago. Held it for a year and sold for $100k profit, while maintaining 15-18% rent returns. After we sold,. the market continued to increase and if we'd waited another year we would have seen another $100k. I have no problem selling when we did as I have long held the motto of "Always leave something on the table for the next guy". When we bought – basic 3 bed dumps were selling for high $400's and renting for $800/w – they soared up for several years and now when I look at R/E.com there are close to 200 places for rent and the same type of place is only asking $300/w and selling for $300k.
Like others on this thread, i am of the belief that if companies like McDonalds are opening there, then there is a long term strength to the town. These companies have huge resources to call on when assessing a location to open in and it is pretty rare to see one close and move out of a location.
For those still invested there, I hope the current state is just the bottom of a cycle and that things look up for you soon.
