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  • Profile photo of RobbiePRobbieP
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    @robbiep
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    April 25, 2011 - 8:49 am

    Kong,

    My apologies, i have just arrived in the country and wasnt sure of the IR.

    With regards to the mortgage term of 25 years? I didnt know it wasnt possible in Australia. In South Africa, it quite normal to have a mortgage term of 30 years. Whats the norm is Austrlia?

    Is it safe to base my simple example with a IR of 7% and a mortage term of 20 years?

    If so, mortgage repayments would be about $740pm, rental income $1100pm (maybe more), leaving a cash flow of about $250pm (before a few minor deductions).

    That look a bit better to you?

    Profile photo of RobbiePRobbieP
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    @robbiep
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    April 25, 2011 - 8:31 am

    Madeinitaly, very simple scenario:

    Lets say you looking for investment property in the $150 000 region. You manage to get a $150 000 property for 20% below market value and you pay $120 000 for this property.

    You are willing to put down a $15 000 deposit, and you ask the bank for the remaining $105 000. I might be slighly off here, but your monthly mortgage repayment with a 5% IR over 25 years is about $600 per month.

    You rental income of a property like this could be $250pw or about $1100 per month, maybe more.

    So the cash flow on the deal would be Income (rental $1100) LESS expenses (mortgage $600pm), leaving you with a positive cash flow of about $500 per month.

    Yes, there will be small other costs associated with running the property i.e. council rates etc, but this is just to give you a very simple example of how decent cash flow is possible.

    All the best.

    Profile photo of RobbiePRobbieP
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    April 25, 2011 - 8:11 am

    Thanks Richard, make sense.

    Profile photo of RobbiePRobbieP
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    April 25, 2011 - 7:10 am

    Thanks for the advice..

    But if you dont own a home in Aus and you currently renting, surely it would be pretty simple to prove that this first property purchased is going to be your primary residence?

    For example, if you still had an lease you needed to honour, which still had another 6 months, could you not prove that you planned to move into your new property when your current lease is up? And if after a short while of staying in the property you decided you would rather rent due to change in circumstance, how would this affect your FHOG?

    My next question is.. if you could not use your FHOG on your 1st investment property, could you still use your FHOG for your 2nd property which was your primary residence? Surely not?

    Profile photo of RobbiePRobbieP
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    April 24, 2011 - 11:03 pm

    Hi Nicole,

    Sounds like you gained some good experience in the UK.

    I built a property portfolio of 30 properties in South Africa in the past 6-7 years and I'm still doing so, no reason to stop just because I'm in Australia. Most of the property I actually sourced myself, but others i also used estate agents, whom i gave my buying criteria.

    I have just arrived in Sydney and plan to do the same.

    Where abouts in Aus are you based?

    Regards,
    Robbie

    Profile photo of RobbiePRobbieP
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    April 24, 2011 - 10:39 pm

    Are there any investors / brokers on this forum who are based in Sydney?

    Profile photo of RobbiePRobbieP
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    @robbiep
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    April 24, 2011 - 10:34 pm

    With $200k cash, there is no reason why you cant buy 10-12 x $150-$200k in the next few months. If each property is giving you  positive cashflow of $500pm, thats already a positive cashflow of over $5000pm…from day one! Over time, with 10% anual rental increases, that would equate to a a positive casflow of over $10 000 per month is under 10 years…plus you would have some decent capital growth.

    Put aside $20k for each property, which can be used for small deposits and fees etc and borrow as much as you can.

    I'm not a financial advisor, but thats what i would do if i had a pot of cash to invest with :)

    Profile photo of RobbiePRobbieP
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    April 24, 2011 - 10:25 pm

    Hi Nathan,

    Do you have a link regarding the event?

    I'm interested.

    Cheers,
    Robbie

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    April 24, 2011 - 9:04 am

    Hi Terry,

    Thanks for the advice.

    That was my approach in South Africa.

    I initially used mortgage originators but found that i actually got a better loans when i approached banks directly.

    If i find a decent MO, ill be more than happy to use their services provided they are able to meet my investment strategy.

    Regards,
    Robbie

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    April 24, 2011 - 9:01 am

    Hi,

    Started working the day after i arrived in Sydney.

    I would be able to give more details offline, pm or email?

    Please let me know if you can assist.

    Thanks,
    Robbie

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    April 24, 2011 - 6:47 am

    Thanks guys!

    Yup, mortgage originators are also used in Souh Africa, but it appears to be dying industry at the moment.

    I purchased my first few properties in South Africa using mortgage originators, but i felt the servfice i got from them wasnt great and I just felt like another number. Their service wasnt personalised for my investment needs.

    About 2 years ago i developed a really good relationship with one of the banks in South Africa and purchased another batch of  properties through them. Once i started running into exposure issues i developemnt another close relationship with another bank and boght another batch of properties through them in quick succession.

    If i am able to get a mortgage originator who undestand my needs and is able to offer me a personalized service, I will be more than happy to deal with them, otherwise I am quite happy to develop relationships with the bank myselfs.

    That said, i am a firm believer in leaveraging Other People Time (OPT) and Other Peoples Money (OPM) to speed up the wealth creation process.

    With this in mind, are there any mortgage originators, in Sydney, who would be willing to chat with me and my investment strategy?

    Please see free to PM.

    Look forward to hearing from you.

    Regards,
    Robbie

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    April 23, 2011 - 10:32 pm

    Hi Nicole,

    What sort of deals were you doing in the UK? Were you sourcing deals and passing onto investors or building your own portfolio (from the deals your sourced) while over there?

    Look forward to hearing from you.

    Regards,
    Robbie

    Profile photo of RobbiePRobbieP
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    April 23, 2011 - 12:02 pm

    Hi,

    Thanks for the reply.

    I used to think the same way, until i dealt with alot of motivated sellers in South Africa. Alot of them were on the brink if financial disaster and were about to have their homes repossessed by banks and have their credit records tarnished.

    They had properties on the market and they just couldnt sell, When they finally did find a buyer, the buyers then got declined finance and left them in a real pickle.

    We would buy their property directly from them or pass it onto our investors who were able to sort them out with a cash purchase of their home.

    These sellers were more than happy to break away from their debts and start over again on a clean slate and 99% of the time the sellers were extremely thankful at the fact we managed to sell their property without any delays.

    We would always make sure ALL parties were happy with the deal, else we would call it off.

    Regards,
    Robbie

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    April 23, 2011 - 2:37 am

    Thanks all, much appreciated!

    Profile photo of RobbiePRobbieP
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    April 21, 2011 - 3:32 am

    Interstings..

    What sort of information can this application give you on a property?

    Profile photo of RobbiePRobbieP
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    @robbiep
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    April 21, 2011 - 3:24 am

    Hi All,

    I went into the office of RP Data today to discuss some of the subscription options they are offering.

    As i plan to source property nationally, i find RP Data to be quite limiting in terms of what they offering compared to the price of the package.

    For example, they have a subscription for about $400 per month which gives you:

    Sales History + Ownership details
    CMA Reports
    On the Market Access
    Market Valuation reports for $20 (opposed to $50 if you have not suscribed)

    The problem with this option is that it limits you to 4 Local Government Areas within NSW, which doesn’t really help if you plan to source property nationally.

    I think if you are a big player in the property game, their services would be ideal. The thing is that i don’t think they cater for the small players who are starting out and they don’t seem flexible on their subscription options.

    Do you guys know of any other companies who do similar services to RP Data? I was told by RP Data that there are quite a few companies out there who are alot cheaper (he was honest about it) but he said their data and reports had higher quality data.

    Look forward to hearing from you.

    Regards,
    Robbie

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    April 20, 2011 - 10:35 pm

    Thanks Angel, I agree with you about getting to know areas and market values.

    If you wanted to view the previous sales in a certain block or complex, how would you be able to get this information and at what cost?

    Profile photo of RobbiePRobbieP
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    @robbiep
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    April 20, 2011 - 10:33 pm

    Thanks for the adice.

    Adt this stage I am looking to get into the property market and looking for properties under $200k, which is defintely possible,

    Are the any areas you can recomend as I doubt the northern beaches would have property under $200k.

    Back to my initial question, are you aware of any 'low income' area in NSW or the rest of Australa?

    Profile photo of RobbiePRobbieP
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    April 20, 2011 - 11:26 am

    Thanks Jamie,

    Can you think of a few interesting areas off the top of your head?

    As i have just moved to Australia, I am only just barely familiar with a handfull of area in Sydney :P

    Profile photo of RobbiePRobbieP
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    April 20, 2011 - 11:25 am

    Thanks!

    Do you know how much they charge for online valuations?

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