Forum Replies Created
Hi Guys,
CBA all the way…! (thumbs up)
ANZ… i dont thinks so, they seem to have a problem with people earning money and the ability to service debts, while some people who have no income are able to still get credit cards and personal loans through them… (worse bank i believe)
Cheers,
sisOriginally posted by Qlds007:I am happy to mentor anyone in Qld when it comes to wrapping.
Due to time restraints would be happy to happy to answer and direct by email to start with.
Cheers Richard
richard at castlewhite.com.au
Email me for details of our Qld wrap CD which gives you a full Installment Contract.Hi Richard,
I would seriously take up your offer
and be very keen to get involved into wraps..I’m also based in Brisbane Northside (Boondall area)
Cheers,
sisHi Jessica,
the nightmare of people wallpaper…
… actucally these are my favourite properties to buy.. nobody likes peeling off wall paper… but having done it several times and it being full day consuming the best thing and honest thing ive found that works is…
** go to bunnings hire the wallpaper steamer.. (rougly around $90 a week hire fee)
** fill the wall steamer container up, it takes a long time to heat up and be ready for use..
** with the wallpaper, peel the top layer, via hand.. and try to peel it off as in big wide pieces (usually it will take about 5-10 mins to do a room like this)(this paper is the paper.. with the colour or wall decoration)
** then with that next layer of wall paper thats under the decoration and between the glue (normally, are very clean smoothing, paper and it almost feels you can just paint over it without peeling..) run you your wallsteamer over it and hold it over the spot for a few good seconds.. and scrap away…
** once all sticky residue.. is peeled and scraped away.. the next annoying task is.. a quick wash with the wall.
** normally we use a sugar soap mixture, and give the walls a quick wash,
** then followed by a quick sand… (yes lots of sanding..)
** normally ive done this in a team environment… where as my brother and i would do this work together.. (it takes us, approximately a full whole day.. to completely do half a house…
peeling and cleaning wallpaper isnt a fun job, and can be quite expensive to get a professional in to do…
** but for some funny reason, ive always found that my properties seem to go up.. after all that wallpaper has been peeled away..
Cheers,
sisps.. hope it works out alright.. its just a pain of a job to do..
geez.. what a bandwith flood.. i just got my application through in the last second…
thank goodness for broadband…
Cheers,
sishonestly compare the unit, to other units around the area.. get a fair idea, of what you think is fair value.. but put an offer of what you think is realistic… but also dont buy on emotions, but set a figure.. if they are asking to much, set your limit, stick to it.. or walk away…
Cheers,
sisit varies from deal to deal, but when im in a fast or rapid negotiation, the offer would normally be a contract or verbal communication, between both the vendor and real estate agent and that my offer is only valid till 5pm that day…
i think 4 days is too long, if its an investment, same day or 24 hours should be enough, cause if someone is serious about selling, and have to think about why they are selling or the offers that are coming in, why are they then selling the property…
.. lol… thats just something i dont get…
Cheers,
sisHi Rob,
thanks for your post.. it is maximum gearing.. probably more suited for a young couple not a couple in there 50’s and 60’s, but yes your correct, if we did put that excess and rental income into straight offset facilities, the equation, would be definetly be different and the return rate would be much faster.. and bigger.. and in all honestly, its something i would definetly do.. or may place it in the stock market.. (but again.. maybe better in an offset account due to the market violatility.. lol)
but what maybe i should address to everyone is.. because my exposure is 90% LVR or leverage (in the scenario), that this same caculation and portfolio growing can be done on an 80% LVR portfolio, minimising LMI fees and exposure levels, and depending on the investor, how conservative they want to be and there risk profile…
the advanatages of a lower LVR is, less exposure, but higher cashflow returns, yet lazy equity is sitting and doing nothing.. but its being risk adverse.. and safe guarding yourself..
well off now.. but.. its been an interesting morning..
Cheers,
sisApproximate Funds we can Invest
$12,000 + $2740 (from $5 rental increase) = $14,740
or
$12,000 + $5460 (from $10 rental increase) = $17,460
****
from the 2 available funds we have above, and realisticly for myself, (knowing that my rentals are consistently being monitored and increased) i will only do the example on the funds of $17,460
our job now is to find another property, at roughly around $100,000 we want to invest $10,000 dollars as a cash deposit so we can have a 90% LVR (realisticly were still 100% and more geared) and we are on the assumptions that the closing cost for the property will be around 6%
** so in total, we need roughly an estimated figure of $16,000 to close our next property deal, we are also on the same assumption, that property is having an annulised growth of 10% a year
based directly on this information, we do find a property for $100,000, we purchase the property with our 10% deposit and use our extra funds to secure the deal.
we are still in our current 3rd year and only own 2 properties so far. Our new property we just purchased has gone up 10%
$100,000 * 10% growth = $110,000
we raise the LVR and drawn down the equity to 90% of the property’s new market valuation
$110,000 * .90% to realise new 90% LVR = $99,000
*****
$99,000 – $90,000 (orginal borrowed amount, due from our 10% cash deposit, from drawing equity from orginal property) = $9000
with this equity we now can take it across as new cash deposits.. and with our rentals being constantly increased and monitored, in our 3rd year, we have managed to buy 2 properties, have a redraw facility of $9000, plus we still have our 4th year, were both properties can increase at a growth rate of 10% each, from this we should be able to buy another 2 properties in that 4 year (on the assumption the properties are being purchased at around $100,000 with 10% growth annulised)
based on that caculation (and cause im sick of typing now… lol and its mothers day)
we should have bought 4 properties by our 4th year of purchasing, that very first property, but by using effective money management and investing in areas of 10% growth..
.. you can have a guess.. how many properties we should have by our 5th year and investing conservatively….
Cheers,
sisps.. anyways.. this is all based on assumption, and future figures could be wrong, as growth can change and same as rentals, but also, in the examples used, such expenses and other fees for property keeping and management were not used.. but as an easy guideline, ive taken out those figures.. yet remembering…
… we never once acessed any monies, that were availabe from the person in our scenario… who was earning a very nice income of $80,000 a year… and could have invested in more property and funded all property expenses, such as what the rental.. could not cover…
ok.. dont ask me next how i came up with around $130,000 (its simply i play figures like this all the time, and i have my own formula for caculating, what figure is actually need, so that the property can be drawn down immediately to access equity, if the property is geared at all different LVR levels..
the actual true figure is around the following $129,629.37 but i have rounded it off to $130,000 to make my example much clearer and easier to understand…
now based on our example again, we are now into our 3rd year of keeping this property its current market valuation is roughly around…
$110,000.00 Property Value Year 1
$121,000.00 Property Value Year 2
$133,100.00 Property Value Year 3
$146,410.00 Property Value Year 4
$161,051.00 Property Value Year 5based on this information, i know that i can, go directly to the bank or my broker and tell them, that i want to draw down my equity to 90% of the new market valuation and still keeping in mind i have a debt of $105,000 still with my lender, its the difference between my debt and my new market valuation, its that equity i want in between, (as its the real equity that i can invest)
$130,000 * 90% LVR = $117,000
remembering we have a debt of $105,000 orginally our true equity that we can access is..
$117,000 – $105,000 = $12,000 true equity and still were within our 90% LVR
now also keeping in mind, if we had been, saving our collected extra rental income, and not looking at any other collect or save income…
we have also the following funds we can invest…
Rental Increase @ $5 (every 6 months) ($5 x 26 weeks)
Year
1st 6 months
2nd 6 months
(jan- jun) (july – dec)1
$130
$260 (increase cashflow of $390 for the year)
2
$390
$520 (increase cashflow of $910 for the year)
3
$650
$790 (increase cashflow of $1440 for the year)Over 3 years, we have the following extra funds that we can invest… $2740
*****
Rental Increase @ $10 (every 6 months) ($10 x 26 weeks)
Year
1st 6 months
2nd 6 months
(jan- jun) (july – dec)1
$260
$520 (increase cashflow of $780 for the year)
2
$780
$1040 (increase cashflow of $1820 for the year)
3
$1300
$1560 (increase cashflow of $2860 for the year)Over 3 years, we have the following extra funds that we can invest… $5460
*****
Going back to the information we know and have. we have 2 different amounts to invest, depending on how much you had increased your rent over that time and also put away in savings..
Approximate Funds we can Invest
$12,000 + $2740 (from $5 rental increase) = $14,740
or
$12,000 + $5460 (from $10 rental increase) = $17,460
Cheers,
sis*** more food for thought for the moment.. but ill show you now, how we are going to invest that money and buy more property very quickly but still very conservatively…
Property Value
$110,000.00 Property Value Year 1
$121,000.00 Property Value Year 2
$133,100.00 Property Value Year 3
$146,410.00 Property Value Year 4
$161,051.00 Property Value Year 5Rental Increase @ $5 (every 6 months) ($5 x 26 weeks)
Year
1st 6 months
2nd 6 months
(jan- jun) (july – dec)1
$130
$260 (increase cashflow of $390 for the year)
2
$390
$520 (increase cashflow of $910 for the year)
3
$650
$790 (increase cashflow of $1440 for the year)
4
$910
$1040 (increase cashflow of $1950 for the year)
5
$1170
$1300 (increase cashflow of $2470 for the year)Over a 5 year period and the rental being consistently increased at $5 every 6 months, you would have collected an extra income of $7160
******
Rental Increase @ $10 (every 6 months) ($10 x 26 weeks)
Year
1st 6 months
2nd 6 months
(jan- jun) (july – dec)1
$260
$520 (increase cashflow of $780 for the year)
2
$780
$1040 (increase cashflow of $1820 for the year)
3
$1300
$1560 (increase cashflow of $2860 for the year)
4
$1820
$2080 (increase cashflow of $3900 for the year)
5
$2340
$2600 (increase cashflow of $4940 for the year)Over a 5 year period and the rental being consistently increased at $10 every 6 months, you would have collected an extra income of $14300
*****
At $5 Increase (real rental increase over 5 years)
now being realistic again, over a 5 year period and increasing the rental at $5 a week, every 6 months for the 5 years, in actual true fact, you have only increased the weekly rental up by $50 per a week, by the 5th Year
At $10 Increase (real rental increase over 5 years)
now being realistic again, over a 5 year period and increasing the rental at $10 a week, every 6 months for the 5 years, in actual true fact, you have only increased the weekly rental up by $100 per a week, by the 5th Year
Cheers,
sis** in next section, i will show why the market value or market apprasial for the property at $105,000 needs a very important apprasial of $130,000 (why $130,000 is very important as it unlocks the key to wealth, and being very conservative still)
Hey Guys,
i really like Rob’s example, as an investor… this would be very similar the way i would caculate his figures…
though as an investor… this is how, i would make this property work so hard and to ensure that over the 5 years.. this one property investment has now turned into 5 – 10 property investments, from just the one investment property..
first things that i would do is, increase the property value, and to ensure that the property is going to increase in both growth and cashflow is… (providing, capital or equity… which everway…)
** buy property – at 105% finance (assuming bank, allows refinance of property, immediately after settlement or after 1 year, due to the property being geared at 105%
** relying on capital growth for one year, and small cosmetic work to the property, and ensuring rentals are being increased every 6 months at a rate of $5 – $10 (or increasing rentals to accurate current market appraisals)
** now from some quick caculations, if i can increase the property up to the value of $130,000 with an apprasial from a valuer, or from the growth of the market moving up north…
or sitting on the property at 10% growth each year annulised. (year 3 – property value $133,100) from caculations, would have to seat on property for 3 years before draw down of equity…
** but caculated at my return rate of increasing rentals at either $5 every 6 months or at $10 every 6 months, i should or would be in a position to draw down equity within 2 years, instead of waiting for the 3rd year, but based on this assumption, i will stick with 3rd year to draw down equity, and how i use the velocity of money to increase property portfolio quite quickly..
next post will show the effect of increaseing rentals every 6 months at a rate of $5 vs $10 over a 5 year period.
Cheers,
sisHi guys,
ill tell ya the story later on, how it was bought cheap, refinace cost were very low, it was just a one off time of $6000, to cover legals and stamp duty, but the refinance cost was only about a few hundred dollars, but due to the market moving fast and the property well truly undervalued.. (for a very good reason)
… but due to a market boom, valuer, wont value property at what the agent has told me that it can sell for…
other problems having similar problem, another property then recently sold for $270k, but valuer would only value it at $250k…
but its a very interesting story, as the next few.. lol..
Cheers,
sislol…
Thanks Rob and Redwing,
why im thinking this way is.. i know a public trustee place, where they auction off jewellery, there not for a profit, but to make the sale, and each week they auction off many different things, though attending one auction, some jewellery was selling for a 90% discount.
the idea is to buy the cheap jewellery, get a valuation certificate and photo, and then use them as collateral for a property purchase…
some like alot of work, but if you can purchase $20k worth of jewllery for $2k and the valuation comes at still $20k for the jewellery, and if they look at either 50% -80% of that complete value, you still have more than enough
… for the purchase of a $100k loan and maybe for legals and duties… though this is just an idea.. (but a serious idea… )
Cheers,
sis… just thinking outside the square, for otherways to secure property, than property or cash as a deposit…
…but thanks Rob, for your very informed information you have me… much appreciated…
seriously…
logan, ipswich, (for both short term and long term growth.. but nicely annulised..)
but for very short term growth.. (rockhampton, both south and northside.. though preferably north…)
Cheers,
sisHi Rob,
sorry to be a pain again.. would you know any good lenders, who take jewellery, as security.. and do you know roughly what there interest rate they charge… or how much of the value of the asset they will look at as security, in a property purchase… (such as jewllery)
Cheers,
sisHi Rob,
what i like doing is, buying high growth properties, in which i can predict, or have a good guess that it will double in a 2 year period. (or just have substainal growth)
eg..
property purchase 100k (10% deposit) 90k loan – 10k cash
property revalue- 125k (10% equity) $112,500 loan – 12,500 redraw
property revalue- 150k (10% equity) $135,000 loan – 12,500 redraw againdoing this over and over again.. through out the year, im able to channel the money back into another loan again, as new cash deposits, and when i feel the property has reached its peak, i will just sell the property and re-subsitute the loan again..
but because i work my portfolio in 3 different areas now,
** buy and hold (constant refinance – some are cross collaterilised, but idea to never sell)
** buy and sell – (2-3 times a year, take profit and just continue to reuse loan, loans are under a straight company structure) constant resubstition of collateral
** buy and hold in a trust or individual name (higher lvr used, or 80% gearing (though dependant on what loan structure) geared in effective manner to get 50% capital gain tax, and use most of banks money… to gear, but turnover is similar to subsitute of collateral, or other forms of gearing, but turnover is on a minimal of 1 year and 1 day from date of contract signed (50% CGT discount) (cross collateral or also used)
Cheers,
sisps…
this is what i do, but i would suggest other people not to do it.. (its just a faster game of, trading property and keeping the better property in a buy and hold position…)
Hi Rob,
the LMI fee wasnt much, as far as i can remember, to be honest im not so sure, cause ive done a few transactions like this a few times now.. but my interest rate is 6.84%
though i know that with my LMI its quite good, though because, each time my property goes in value, i actually do refinace, it, up to 90% LVR and redraw the excess funds and uses those excess funds as new deposits…
but thanks heaps for your help Rob, much appreciated…
Cheers,
sisHi Cosmocom,
my family owns quite a few property in the philippines, we bought it off the plan from a development corporation there, in an area called Landayan – San Pedro, / Laguna, we also have alot of acerages and farm land there too.. though there is plenty of risk in buying in the philippines is not worth it at all..
some of my own family is from there, and i can honestly tell you that, even some of our own family members ripped my mother off on the deal and transaction..
theres alot of corruption there, ive been there several times in the last year and over the years, and did have a look at many properties in Manilla, and a long UN drive and along the boulevar, a few of the units i had a look at were aroung 840,000 peso’s, though thats quite cheap, unless your going directly to a sales and marketing office…
my uncle there is a developer, and what i can say honestly, he makes big money and all there, theres a lot of corruption, under the table dealings, and alot of people have bought properties and soon to find them, being squated by people very less unfortunate…
i would honestly, suggest you dont buy there, and look for a safer area to invest, not only that, property ownership there for a foreign, the share is not equal at all..
Cheers,
sisHi Rob,
it varies from person to person, if your consistenly investing your equity as deposits for next property purchases, and your properties are going up invalue in growth, it doesnt hurt to much, when your portfolio, is growing at a substantial rate, to draw down some equity to fund your life style,
though it will depend on the investors, on how they go abouts there property portfolio and how they manage there income, but also selecting growth properties, for the future..
Cheers,
sis
and be very keen to get involved into wraps..
