Hi,

The fund concept is moving ahead. At the moment I am sorting out the ASIC licensing requirements.

Stay tuned though as hopefully this will be sorted soon, at which point I’ll move on to preparing the Product Disclosure Statement.

If you’re coming to the market updates then you’ll find out a little more information. Otherwise I will make an announcement to the database when I have more details.

Cheers,

– Steve

Still waiting to hear back.
 
Will follow up again when I can. Have hurt my back though and am resting up for a few days. Sitting is super painful.

– Steve

Stephen,

Perhaps if you asked a few specific questions you might get some more answers. The more general the question, the harder it is to answer.

– Steve

Hi,

Derek has put forward some really sensible tips, and I echo them.

Student accom is often shunned because it is seen as more cumbersome in management and because the property depreciates with the higher density use.

The return looks okay on the numbers you have presented. How much are you planning on borrowing. It's hard to be exact with the numbers you gave. $5,500 is close to $100 per week, so that's a lot better than the negative gearing returns many investors get.

I would want to compare the return with what you could get leaving your money in the bank though. That is, how much more rent will you get for taking the risk vs. interest you get by leaving the money in the bank (given it seems there is no/low growth prospects).

The usual reason that there is low growth on student accom is that it is typically sold to investors, and therefore there is not the 'emotion value' home buyers are prepared to pay. There is also more and more student accom coming on the market, and so the new supply tends to undercut the existing second hand market (that is, discounting for new properties undercuts the value of existing properties).

I would encourage you to do a fair bit of due diliegnce on the assumptions. In particualr:

a) In regards to the tenants:

i) Can you get three people who all want to live together
ii) Check the advertised rent has been achieved
iii) Check vacancy periods
iv) Check how tenants are attracted to the property
v) Length of the lease (are they all rolling 1 year leases)

b) In regards to the management:

i) Who does it?
ii) How is the rent collected?
iii) What about during school holidays?
iv) Are any furnishings needed?
v) What are the costs (management and other)
vi) Documentation: lease, condition report, bond, etc. Who does it?

c) In regards to expenses

i) Body corporate?
ii) Land tax?
iii) Repairs and maintenance allowance
iv) Other

d) Resale
i) Process
ii) Are you free to use your own agent
iii) Likely marketing channels

e) Other
i) Other student accom in the same area
ii) Other student accom in the same building
iii) Risk free return comparison

Finally, I think you are just the person who would get a lot from the seminar series I'm about to run. Check out the link below and book in if you can make it.

– Steve

Okay okay… I've seen the post and will put it on the wish list!

The ATO goes through phases… sometimes they are lenient, other times they come across heavy handed.

The old rule used to be that when there was an argument that something should / should not be included in your tax return then you were safe from penalties so long as you had a reasonably arguable position. I can't see this applying to shoddy record keeping though.

Personally, I'd rather know my records are as they should be than hoping I don't get audited, and, if I do, relying on the mercy of the happy folks at the ATO.

– Steve

Hey Rick,

James Simango (US Tax Central in Brisbane) is a great help. He's a CPA in the US and also in Australia.

I'll try to do an interview with him on the topic of tax deductions and add in to the US Focus Group resources in the next couple of weeks.

You might also want to check out a book called 'tax wise'. I got it off Amazon. Here's a link:

http://www.amazon.com/Tax-Wise-Business-Ownership-Toby-Mathis/dp/0979786002

Cheers,

– Steve

Hey Stephen,

You must be a nice block with a name like that .

Many people comment that starting out is the hardest part – not only is knowledge an issue, but so too is confidence.

I could go on an on about this topic (in fact… I will be at the upcoming seminars I have just announced), but for a quick answer that I hope points you in the right direction:

1. Many investors buy a property and then make a profit. That is, they buy then strategize. This is a flawed approach.

2. Instead, the first step is to work out your wealth creation goal. That is, what you are trying to achieve from your investing.

3. Once you know your goal, you can then look for a model or investing approach that will get you there. For instance, you may need to buy multiple properties, and 'trade them' as you build your capital. Or else you may have a long term approach and can buy (say) a property every couple of years and achieve your goal if you achieve your growth targets.

4. Once you know what profit you want, and when you want it, you can select the most appropriate investment strategy.

5. Armed with knowledge about the goal you have, the profit outcome you want, and the best strategy to achieve it, your next step is to identify an area you want to invest in, and then ultimately the 'right' property for your needs.

6. Of course, once you have found the property, it's up to you to do your due diligence and then negotiate a price you're happy with.

7. Then, once you've bought it, you should look to apply skill to get above-average growth and income returns.

Phew! That's quite a bit to take in, but it's a quick step-by-step approach which I strongly believe will lead to the most successful investing outcome possible.

If you'd like to know more on this topic, then I suggest you take a look at the seminar series I'll be running soon. The link is provided in the signature tag below.

Cheers,

– Steve

Hey Tugger,

Have you tried doing a good old google search? There are probably a number of templates out there you could access.

– Steve