Cheers for the post Jamie. Thought it would have received more response considering LMI can be a great tool for increasing your portfolio numbers.

Would you recommend utilizing LMI as a basis for a beginners property investing strategy? When I first read about it it sounded like a great way to quickly increase the number of properties you can buy and as long as there’s enough of a cash buffer to ensure the loan isn’t defaulted at any time.

Is there an industry standard for the cost of LMI or does it differ from bank to bank and their perceived level of the applicants risk? I’ve only seen $6k/year being mentioned as a cost and this seems like a pretty small (tax deductible) expense considering you could be receiving capital growth from 2 properties instead of 1.

Regards,
Derek

Hi Mike,

I’m currently on a student visa which will soon become a temporary resident type visa while I apply for full PR. I recently asked ANZ if I’m able to apply for a mortgage or large personal loan but they said I’d have to wait until I achieve full residency status before they would even consider it.

You may be in a much better position with your business visa, decent wage and already owning an IP so it would be worth setting up a meeting with your banks financial advisor to find out what they’re able to do for you.

I have 3 friends on the same visa but 2 of them lost their jobs due to cutbacks and had to leave Aus so I think this type of unforeseeable circumstance highly affects the banks decision to loan to non-residents.

If the banks say no, there’s always other companies that may be more willing to help you out but of course this usually comes at more of cost to you.
Let me know how you go either way.

Regards,
Derek

Hi Chris,

Just finished reading Michael Yardney's book 'What Every Property Investor Needs To Know About Finance, Tax and the Law' and it pretty much covers all the questions you asked. I highly recommend buying it as it would definitely be an invaluable learning tool for grasping the fundamentals of property investing. It's also written in plain English so quite an easy read too.

After reading McKnight's books, I was all set to hunt for postively geared properties only but when I finished reading Yardney's book and grasping the concept of how negative gearing can really help accelerate your rate of acquiring IP's, I will be implementing this method into my PI business strategy.

As Jamie said, there are more creative ways that can also help gain equity over a short period of time. Nathan Birch seems to be a master of this, check out his Youtube channel for some impressive reno's and figures. He's still making massive profits and creating positively geared IP's when many people believe this has become exceptionally difficult due to the current market conditions.

Regards,
Derek

Hey Andy,

Just have to say that your blog caught me off guard, wasn't expecting such a funny read! Favourite quote- "Nothing says quality like a piece of miss-matched, ripped, green shade cloth hanging off your balcony, and you just know that the owner of this wonderfully crappy looking house has been watching Better Home and Gardens for styling cues." Hilarious!

Will have to read the rest tomorrow as it seems like it'll be an informative read, especially with your active investing experience behind it. Out of interest, did you end up buying a business after being inspired by the Rich Dad book? 

Regards,

Derek

Hi Orks,

Where abouts are you considering investing? I'm in a similar position with regards to a significant amount of disposable cash and was thinking of investing in the U.S. too as I can just buy a house outright and not have to deal with banks, mortgages etc. There's a lot of info just on the forums here about the best places to invest (maybe too much!) and how to go about it.

Obviously it's a great time for investors to buy but I have heard there is a tremendous amount of hassle involved so still unsure as it would be my first foray into property but I can imagine in the long term it would definitely pay off. There was an article on Somersoft.com that detailed the negatives of a members experience over the last 2 years or so and it did seem quite a challenge, even more so from another country.

I know someone who bought a house in Missouri for US$33k and after all expenses, he gets US$650 deposited into his bank account every month. The house will pay itself off after 6 or so years and can only increase in value during this time. This is something that may be worth the hassle and considering you can buy a house in the U.S. for what is usually just a deposit in Aus, it's a great deal.

Regards,

Derek

Thanks Bluegrass for mentioning the NRAS, my 'learn something new every day' goal was fulfilled within 2mins of logging on. Seems like an interesting avenue to engage in, especially as there's always demand for affordable housing. Will look into in more detail.
Cheers for the Property Tool Analysis spreadsheet too, I'm sure it will prove invaluable in the the near future

Regards,

Derek

This will be my first time attending any sort of property seminar so really looking forward to it and it's the first step in a more proactive approach. It'll be a very intense 3 days but I'm sure it will benefit me immensely.

From reading many forum posts, it sounds like the a lot of those attending are as educated as the speakers! I read a few comments about last years event and it got mainly positive reviews (aside from some of the speakers surreptitiously creating a buzz just to sell their product at the end of the talk).

As a friend dropped out and I have yet to find a replacement, looks like I'll be going alone. Unless someone wants to join me? The reward for such a sacrifice is a free ticket!

Also, is anybody thinking of going to the Trump/Kiyosaki/Robbins event in Sept?( http://www.nationalachieverscongress.com.au/event.html). $200 seems pretty reasonable to see such big names live.

And Nathan, I agree with MattNZ about thinking of being a speaker at the next event. Would be great to see some young and successful talent such as yourself sharing ideas and different methods.

Regards,

Derek