[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 29, 2003 - 12:24 am

Ok,

I’m no lawyer… but my understanding (at least in Vic. anyway) was that you could by a property ‘and or nominee’ with the intention of setting up a company and there was no double stamp duty. This avoids the need to incur a cost before beginning.

However I know this flexibility is not available in Qld… the structure must be set up first. Other States? You knows? It would pay to get some legal advice before going to far down the track.

Regards,

Steve McKnight

P.S. Wealth Guardian due to be released early March

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 28, 2003 - 8:12 am

Hi,

Thanks for your post and welcome to the community []

Please note this is NOT financial advice.

If you wanted to invest indirectly in property then you might like to explore the idea of listed (on the Stock Exchange) property trusts.

This would allow you to invest in property and also have liquidity if you decided to sell.

Alternatively, you need to weigh up the amount of risk you are prepared to take on with your savings. I remember only too well the people who had their money with “Pyramid Building Society” trying to eek out an extra 2% only to lose everything.

Me, for my personal funds (as opposed to busines money) I have an e-trade account that earns a pittance, but more than the token amount banks offer.

Cheers,

Steve McKnight

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Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 28, 2003 - 2:01 am

Hi,

quote:

---

A bank is a place where where they lend you an umbrella in fair weather and ask for it back when it begins to rain

---

What a gem of a saying! And how true.

My advice… don’t confuse a lifestyle decision with an investing decision.

If you want to own a home then that is an emotive decision, not an investing decision. The reverse is also true.

Investing does not come without a cost… only you can determine whether you are willing to pay the price.

Bye

Steve McKnight

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Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 28, 2003 - 1:58 am

Hi,

Welcome to the community and thanks for your post.

quote:

---

I am in the process of starting a business that can pretty much run itself so i am hoping to earn a few thousand dollars from this venture which i can later put into property investments.

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Excellent… do you want to mention what the business is as some community members may be able to help you

quote:

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However in the mean time i have around 12k savings and earn around 1100 month. Can anyone advise me on what i can further investigate on purchasing property with the amount of money.

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Really? If you can achieve this sort of return (nearly 100% per annum) then I’d forget about property and keep doing what you are doing!

You are earning nearly 100% return per annum!

quote:

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Realistically i would be looking at places no more than say $50 000. Has anyone on here started in a similar situation and can assist me.

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Well, not wanting to repeat old ground, I suggest you buy FastTrack, which is a tape outline of how my business partner and I began property investing.

quote:

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I know i dont earn much yet, im sure there are ways (of which i dont know yet) in which i can start purchasing properties and generating some passive income along the way.

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You might like to sell a few of the deals you find to begin with to raise extra cashflow… or alternatively you could joint venture someone so that they pay you for finding a deal and putting it together.

quote:

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I would like to generate around $2000 in passive income this year from property.

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Excellent. Now you have a goal you can break it down into # of properties needed and then break it down into # needed per month.

quote:

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Any one with some advice for a 19 year starting out. I have read just about every post of this forum and have the concept of wraps but i still need to do more investigating.

---

It’s difficult to post when you don;t ask specific questions. All I can really offer is encouragement and to remind you that the only barrier to success is yourself. Oh, and never take no for an answer.

Cheers,

Steve McKnight

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 28, 2003 - 1:50 am

Hilary,

Please e-mail me the details and I will post them here for all to see.

Thanks,

Steve McKnight
[email protected]

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 25, 2003 - 2:59 am

Hi Sooshie,

Hope you’re enjoying this heat [8D].

I gave Brent a project to do a few weeks ago which was to look at foreign investment in:

*Australia
*US
*Canada
*UK

He is currently doing the research and we hope to publish the information on the site by mid Feb.

Cheers,

Steve McKnight

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 24, 2003 - 4:23 am

Hi,

Welcome to the community and good on your for having the courage to make a post. Thanks also for your kind words.

I have the time for one quick post…

Re: loan provider…

You may find that your existing lender will be happy to help you out, but I would certanily shop around.

The equity that you have allows you to redraw against it to fund the deposits on other investment property, rather than needing cash.

What I am trying to say is…

The question of raising money for a deposit is separate from the question about who to use to finance the property.

You have the deposit issue licked via redrawing (or refinancing) the equity in your property.

The issue of financing… start with your current lender, but it would be wise to shop around as your current lender will probably just process your application for finance like any other.

No harm in trying though.

Cheers,

Steve McKnight

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 23, 2003 - 11:20 am

Always here to help []

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 23, 2003 - 7:34 am

Hi,

Sorry, I was not very clear. What I meant was get the accountant to approach his/her clients with the offer on your behalf and earn some kind of commission or trailer.

That’s how financial planning works []

Bye

Steve

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 23, 2003 - 3:48 am

Hi David,

Thanks for your post and welcome to the forum.

Please feel welcome to post more questions, and also replies, in the future.

You ask:

quote:

---

I’ve sold a property for $40,000 profit. I have owned it for more than a year.
I was told that I had to pay $10,000 in capital gains tax. (50% of half the profit) is this right?? or do I paid tax on 50% of half?

---

The correct treatment is to take half of the capital gain (in your case, $20,000) and include that in your personal income tax.

The amount of tax that you will pay will depend on what other income you have. If you are already on the top marginal rate, you will pay ($20,000 * 48.5%) of you capital gain in tax.

Please note that depending on when you purchased the property, you might find that the old method of indexation will give a better tax result.

See your tax adviser for more info.

Cheers,

Steve McKnight

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 23, 2003 - 3:38 am

Hmmmm…

I think the answers to this post have missed a bigger issue.

The solution to effective negotiation is not low-balling, but to create a win-win outcome.

Find out why the vendor is selling and the structure an offer where everyone wins.

Look to be flexible on price or terms, but only offer an outcome that meets your investing outcome desired.

Bye

Steve McKnight

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 23, 2003 - 3:35 am

The King Is Back!

Hi and welcome to the forum.

I know that this topic has been covered in prior topics. Have a search around (use the search feature) and maybe use the words ‘solicitor’ and see what comes up.

Might I also suggest that you consider joining the Wraps and Vendor Finance Association.

Cheers,

Steve McKnight

p.s. Welcome aboard!

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 23, 2003 - 3:22 am

Hi Trying,

Oh dear… might I suggest that you are on the verge of making an expensive mistake? Not because of what you have done, but because of your lack of knowledge about how it works and how to set up an effective structure.

Brent is right to point out about Wealth Guardian, but that is still a month or so away.

In the meantime, I’ll try to help with some of your questions:

quote:

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…i am excited about this company and the trust but i dont know to much about it, if it is a seperate adentity what does that mean what can i do with it and what can i get out of it.

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Who set up the structure for you? I strongly suggest you go back to them and get answers to your questions. Especially so with your plans to purchase land… do it b4 you buy as it could be expensive to change later on.

quote:

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i am about to purches 2 blocks of land through it ,,that, to avoid land tax…

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It is illegal to avoid tax. Be careful with your choice of words as it underpins your intention.

quote:

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…can i use the eqity once it grows ,would that be like have cash flow in the company…

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This is not right. You might be able to access the equity from any capital growth, but to do this you will need to refinance (no easy process), plus, if you use that equity to finance your lifestyle then the interest on the lifestyle related debt will not be deductible.

Understanding this underpins my recurring +ve cashflow focus.

quote:

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and also my 20year old, daughter is very keen and <smart> to start in this way , she has a steady job and gets around 36,000 a year so. Can i help her in any way maybe through the company or trust

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What kind of help do you want to provide? There is some room for income splitting as your daughter will be on a tax rate of 30% This means that if your marginal tax rate is >30% then it would be better tax-wise to distribute to your daughter rather than to you. BUT!!! This raises all sorts of issues for which you need specific financial advise.

quote:

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…all i know is that a company will be good for land tax and thats about all

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Hmmmmm…. I wonder why you think this? Could you pls expand as from my knowledge there is no benefit from holding land in a company from a land tax perspective.

quote:

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…if any one can give me some pointers i would be most grateful…

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Seek advice from a good accountant… quickly! You have a little bit of knowledge that seems to be potentially dangerous.

Good luck…

Steve McKnight

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 23, 2003 - 3:06 am

Hi FW,

There are a few issues that I’d like to alert you to…

The first is that by seeking investors on this forum puts you at risk of breaching Corporations Law, which has very specific rules about making a public offer for investors.

Given that there are over 5,000 members to the site, you are on uncertain ground about whether or not you need a prospectus. I’d get some legal advice about this.

As for finding investors, I’d start with a closer circle or network of people that you know. For example, you might like to approach your accountant you can put you in touch with high net worth (money rich – time poor) people who might be interested in your terms.

As for what to say… well, as an investor I’d be asking how much in, for how much back, for how much risk? If you could answer these questions and be accurate and honest for what could go wrong… then I think you will go a long way to being equipped to answer questions.

Nevertheless, you will only know what to say after you have been asked a question. Don’t be afraid to say that you haven’t considered something if you don’t know the answer.

My experience shows it’s better to be humble than gung-ho!

Having said this… you must know your core offer and service back to front.

Cheers,

Steve McKnight

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Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.com

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 21, 2003 - 11:00 pm

Hi Carl,

Thanks for your question.

When I started I found that the local council had demographic data about the region to attract investment.

Perhaps a call to them (or check out their website?) might yield excellent results?

Cheers,

Steve McKnight

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 21, 2003 - 8:54 am

Mate,

I wasn’t telling you what to do… just giving you an option.

If it were me though I’d be thinking about two things…

1. How can I turn my -ve cashflow property into a +ve cashflow one, and

2. What do I have to do to invest in such a way as it will bring me to my goal in the quickest time.

Perhaps your indecision stems from not having a structured plan beyond making money?

OK – that’s it… see you tomorrow.

Bye

Steve McKnight

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Remember that success comes from doing things differently.
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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 21, 2003 - 8:32 am

Hi,

Last post for the day as my fingers are starting to hurt from all the typing []

Interest only was just to illustrate the point in the example. Would have required more time to work it out P&I. Personally, all my residential loans are P & I and most of my commercial loans are I/O (I’ll explain why in a newsletter sometime soon).

As for properties… just like the X-Files… they are out there, just start looking in unfamiliar places.

Cheers,

Steve McKnight

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 21, 2003 - 8:07 am

Hi Chris,

Thanks for your post and welcome to the community… all the way across the pond in the States!

Brent from ny office has done some research on your behalf on the topic of foreign investment in Australia.

We are building some web pages to discuss this, but in the meantime you might like to read:

http://www.firb.gov.au/policy_pubs/download/urbanpolicy.pdf

Good luck! I’d probably look at the JV option for old / established property… but do you due diligence on the investor carefully.

Cheers,

Steve McKnight

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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 21, 2003 - 8:00 am

Hey Superman!

Interesting question!

I’d be inclined to go for the house, unless the unit was a stand alone or I could acquire all the units.

The reason why is that I have found that dealing with body corporate issues and other tenants is far too time consuming!

Still, you’d also want to look at the cash on cash return which on the unit is likely to be better as it is less cash down on a 20% deposit basis.

As for appreciation, land appreciates and buildings depreciate, so if you are looking for capital growth then go for something with land.

Cheers,

Steve McKnight

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Remember that success comes from doing things differently.
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Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
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[Steve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763]

January 21, 2003 - 7:53 am

Michael,

Sorry mate, I missed your first post.

The go-to legal guy in Tasmania is Nick Raeburn. Contact him on 6337 5555 (Launceston).

(be sure to tell him he owes me lunch for the referral!)

Accountants? Sorry mate, I do all my own stuff in-house.

Bye

Steve McKnight

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Remember that success comes from doing things differently.
**********

Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.com

Success comes from doing things differently