Forum Replies Created
Hi JaJa,
I’m not sure if your were at yesterday’s seminar or not…
In any event, I’ve ready through approx a third of the feedback forms and there were a few comments where people mentioned that the content was straightforward.
On the other hand though, others mentioned that the ‘nuts and bolts’ detail that was presented about the system Dave and I used to buy real estate was the missing link of information that had not previously been explained in my books or seminars.
For my experience, the steps that appear simple or basic are often those investors ignore or forget which can undermine their profits.
I believe that the key to controlling and managing (from the investment rather than the property perspective) a multiple property portfolio involves a system that:
1. Removes emotion from the investing decision as emotion can cause investors to act irrationally.
2. Allows time-leverage. In short, time is an investors most important asset so in order to maximise it, investors need to delegate. The only way this can be done is via a system where the result is guided by internal controls derived from a knowledge of the process.
3. Uses templates to ensure accuracy, completeness and time management.
4. Allows an investor to focus on the small number of potential leads that do fall within a pre-defined search criteria, rather than the large number of leads that might be appropriate.
etc etc
So, all in all, the idea for the seminar was to share the nitty gritty detail of the system we use behind the way we find, qualify and buy property. In fact the beauty of that system is in its ease of application as, as someone wise once said, anything doable needs to be easily understandable.
While there are certainly risks to be mitigated, at a conceptual level there isn’t anything too difficult about the way we invest; we buy cheap houses that make money.
The system that supports this process therefore needs to:
1. Find appropriate potential houses
2. Qualify those potential houses so that we focus on quality houses that are most likely to deliver the investing outcome we desire
3. Control the buying process given that we often have multiple offers (20+) in progressI hope this has helped provide more information about the seminar, it’s objectives and some of the content that was discussed.
Have a great day,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
I believe this link will help you with transport:
http://www.avalonairport.com.au/pdf/Sunbus_Fact_Sheet.pdf
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Readers of my earlier columns will recall me saying that all investors should add 2% to their current interest payments and deduct 10% off their rents — and get out of the market of the numbers don’t stack up.Sounds like wise words to me, if only to complete the exercise as a worst-case scenario.
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
What I find interesting is that the masses didn’t see the stockmarket of 1929 unfolding until after it happened. Why? Greed.
Nat R’s point about more sophisticated markets is well made, but at a grass roots level, people remain greedy which is why the boom and bust cycle will occur.
For example, where was the sense in the tech stock rise and fall? All this nonsense talk of ‘new economy’ stocks allowing inflated earnings multiples had sensible folk scratching their heads in astonshment.
So too in real estate… yields as low as 2% or even negative simply isn’t sustainable when reality overrides emotion.
My thought is that, having identified the problem about baby boomers and retiring, the government will work hard to soften the impact. As such, I doubt this will be the root cause.
Instead, something else will crop up as a result of humans thinking they are either too smart, or else the lessons dealt by history no longer apply.
As for Kiyosaki… I would probably still be an accountant if I didn’t see the sense in what he was saying in RDPD. Don’t accept anything anyone says in the financial world as gospel though. Take a concept and test it for yourself before conculding that it does or does not work.
Bye,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi Tom1000000,
Actually, I feel that I have built enough wealth and certainly don’t want to hoard it.
My main goal in investing now is to continue to raise money to contribute into philanthropic activities which we have begun.
This all started when my books sold well, and now has become quite a focus.
Also, there is a certain amount of enjoyment that we get from investing. As such, we do it not because we have to, but because it is something we enjoy.
For example, does someone who loves their job quit when they attain financial independence? Or does simply the nature of the relationship become different as now they do it because they can rather than because they have to?
I also like sharing information about what works in property investing, and I feel that to do this with any credibility, I should remain an active investor.
As for how much is enough… I have rather large philanthropic dreams.
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
There are certainly opportunities in the US market, but with overseas investing attracts significant risks… especially when it comes to financing and managing the deal.
In terms of the $7k houses, they certainly exist, however we have been shyed away from them as did not present as the best investments.
Nevertheless, I am currently working on an article about Aussies investing abroad. When it’s finished I will post it up here on the site where you’ll be able to access it for free.
Next up, please avoid any nonsense debate about divorce, as that is not helpful for anyone. Nor are questions about who is worth more than who. Wealth creation is not a race, rather it is a journey about trying to figure out how to use money to create a better life without becoming consumed to it.
Constructive criticism can be helpful, but destructive criticism denotes bitter envy and selfish ambition. It is always better to encourage than to tear down.
Finally, there are no secrets. If you have a question then by all means post it and I will answer when time permits.
Have a great night.
Bye,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
I think this topic has reached its logical conclusion. Issues with Neil Jenman should be taken up with him in person rather than posted here.
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
To clarify,
When making posts on this forum I only ever use one of two member profiles…
1. Steve McKnight, or
2. If I am doing admin work and need to be loggedin as ‘Admin’ when I see a post, I will answer it as Admin.
Comments made in this post were genuine. I don’t need to feel secure about myself by creating false testimonials.
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
Let’s be sure to differentiate fact from opinion here.
FACT: The website is down.
OPINION: Why it happened
The victims here were those who went ahead with purchases on the basis that they could get the loan. To the extent that representations were made, I’m sure legal advice will be sought.
BTW, moderators of this are, of course, fully entitled to express their independent thoughts.
I thought this was a good post (no interest in no interest… lol). Let’s just keep the discussion away from personalities and focus on issues.
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
I just wanted to say, aside from some of the jibes, this has been a refreshing post for a number of reasons:
1. It actually identifies a trend that there doesn’t seem to be as many people online as once there was. I agree, however…
2. A lot of people sit offline and read, infact for every one person who posts the traffic reports on this site indicate that 100+ people read
3. With so many posts, lots has been discussed. As such, people spend a lot of time going back over past posts and learning, which is great.
4. The forum is all about people from different walks of life participating in a way that helps each other out. Should this site be seen as the ‘Newbies’ site, then I’d be more than happy with that. Help is help.
Thanks for having this discussion though as it has pinpointed some issues that need addressing to continue to build the community.
Have a wonderful day.
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi Darren and Kerri,
Thanks for your post.
Questions to ask property managers
I think there are two aspects that you want to find out about:
A. Experience: I have found the best property manager I have ever used wasn’t straight out of school, but was a ‘crusty’ lady who, after many years experience, had heard and seen every tenant trick in the book. Despite her awkward manner though, she had a very fair heart and was proactive in supporting good tenants through proper management of the property and the landlord. Experience is worth its weight in gold.
To find out what experience a rental manager brings to the table you just need to ask. Actually, it would be wise to interview them like you would a potential employee. You may also like to think up some case scenarios as a test to see what they would do.
For example, you might ask: “A tenant has fallen behind in their rent to the tune of three weeks. They promise that they will come in and pay in full at the end of the current week. What would you do in this situation?”
A good reply would cover two aspects:
1. The tenant shouldn’t be 3 weeks behind in the first place.
2. There needs to be some kind of payment plan (in writing) to catch up the arrears rather than hoping for a full payment.
3. At what point do eviction proceedings begin?
B. Cost
You also want to know how much the services are going to cost, and not just the ‘obvious’ expense of general management fee (usually a % of rent). Other fees to watch out for include letting fees, tribunal fees, inspection fees, statement fees etc. etc.
Special Conditions
Really, the sky is the limit here provided you do not contravene tenancy laws. Common special conditions include:
> Pets
> Noise
> When rent is to be paid (usually 7 days in advance)
> Need to have carpets cleaned
> Persons (not on the lease) that are able to reside in the property
> Costs to be paid for early termination of the lease (such as advertising etc.)
> Agreed rental increasesIf anyone usues other special conditions or has other comments then please reply to this post as it is an excellent discussion starter.
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi all,
Thanks very much for your birthday well wishes.
Have a great day,
Bye,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
Yes, I have heard this doen before and it has been very profitable for those concerned.
It is not getting paid to do nothing though, as you receive for fee for managing (i.e. increasing the profitability) of the property.
Conceptually, it’s like a rental management agency paying for the right to receive the income over a set period of time. Now, this does not happen for a house on a single-holding basis, but if you have (say) 20 units each owned by an individual then someone will need to ‘manage’ them for the group.
As for value… something is only worth what someone else is willing to pay for it!
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
Just make sure that the CGT advice you have is from an experienced accountant.
I’m probably wrong, but I thought you could still have a PPOR that you rented out for up to six years and would still qualify for the PPOR CGT exemption.
If you have bought another house elsewhere, then you may be liable for CGT on the price gain since you moved in and when it becomes your PPOR, but this can all be worked through.
Then again, I’m not ‘in the know’ about these things anymore… which is why you need to seek the paid advice of a qualified and experienced professional.
Bye,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
Rob – in the right frame of mind, you really are a tremendous asset to this forum so thanks for your contribution.
JF, like any investment you ought not evaluate your decision against opinions so much as you should against your own pre-determined minimum ROI.
That is, Rob has warned you that the market may be uncertain, and on the other hand Brahms is more bullish. Both may be right, but in your case, how do you know what to do?
My suggestion for you would be:
1. Go back now and look at how much profit you may have made based on actually receiving 75% of similar prices (call this a conservative reality check)
2. Set a minimum required ROI for each property you own
3. Take the time to work out if your current plan is sustainable. E.g. how much debt do you have and how does this impact on your ability to borrow more? Also, are you in a heavily growth-bias strategy in a market that may have moved into a different phase.
4. Can you earn better returns elsewhere, in which case should you hold, buy more or sell?
Finding answers to these questions will help you think through what to do next.
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi Nehal,
What about moving your thinking sideways…
Until you can get funding on your own two feet, why not put a deal together and then seek private finance and/or money partners and share your profits.
Remember that 100% of nothing is nothing. Sophisticated investors look further than what they can do by themselves as they know a good project will always attract smart money.
In your case then, as a concept (not an invitation for business) I wouldn’t back YOU (given lack of experience etc.), however I might back YOUR DEAL – provided you had all the basics covered.
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Mareeta,
The profit would be earned by the AB Trust and then a distribution made to your Super Fund.
Unless there is something unusual happening in your fund, the Super Fund would then include 33.3% the capital gains distribution received as assessable income.
Super Funds pay a flat 15% tax on their net taxable income.
The other comments on companies are well made. Perhaps an important area that was not touched on in the newsletter are the possibilities of CGT roll over (i.e. deferral).
In the US you can defer the payment tax if you roll the property gain into another property deal. This concession is not available in Australia (for real estate), but is, in some circumstances, available for businesses.
As always, see your accountant for specific advice as needs be.
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi JJ&Jo,
You probably picked this saying up from either myself or Dave Bradley, as we are the only ones I know who use it because it summarises our approach to negotiation.
In essence, what you are doing is offering the vendor either his/her price or else his/her terms. The idea is to give some ground while also getting some ground.
For example, I’m happy to pay full price (if I think I can make a profit), and it may even be that the vendor’s sale terms on offer suit me, but if they don’t then perhaps a delayed settlement, low-money down or vendor carry back will sweeten up the deal.
It would also be wise to remember that you ought not aggressively negotiate on a deal that you know is great. That is, don’t try and negotiate on the purchse of a gift horse [wink4]
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi LKGK-88,
Finding properties that meet the 11 Second solution in their own right was never easy in the first place, but is even more difficult today given the property boom.
Instead of trying to buy the deal though, thesedays I try to make it by adding value and by thinking differently. This was certainly the approach I encouraged in the MAP, and you can read for yourself the approach that the mentorees took in my second book.
See this page if you would like more info on the 11 Second Solution: https://www.propertyinvesting.com/11secondsolution.html
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi,
While structuring is important, it is really secondary to the investing purpose to start off with.
Personally, I think you have made a very good (perhaps great) start as it is as I had nothing like your asset situation at 27!!!
My comments come back to a few core issues:
1. The equity in your property may become lazy money if your do not continue to earn solid capital gains. As such, you may like to consider ways to recycle it so it works harder for you. In our business we do this by selling our properties and then buying more assets with the net proceeds. I talk about this concept in my second book and then go into more detail at the MasterClass.
2. I like to keep personal assets personal and business assets business. Mixing the two can create all sorts of mental and financial problems. In short… keep it simple whenever possible.
3. Crunch the numbers on your ROI with your savings. I’e found that many people find they earn a better after-tax return ploughing the money off their mortgage rather than keeping it in savings.
4. Finally, have you ever considered commercial property? There is a world of opportunity there too.
Cheers,
Steve McKnight
P.S. The link to WealthGuardian is: https://www.propertyinvesting.com/resources/11.html
Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
