Forum Replies Created
Depending what state you're in, ask TICA if you can subscribe to their database as a landlord.
BTW, my C2 likes your pic.
Cheers
thecrest
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi Steele Blade.
Welcome to the Forum, members appreciate meeting new members and like to know a bit about you or your occupation or circumstances. People are always interesting. Then while you are receiving info and assistance, others can look to you for info and assistance when they know your occupation or area of expertise.
First, the usual disclaimer applies, talk to your accountant who has knowledge of your personal financial situation and can advise you of the differences between whatever you have now and a motel live in situation. The following is only my uneducated inexperienced unqualified opinion and you must get your own expert's qualified professional financial opinion which takes into account your personal circumstances.
Many of the investment self help books, incl Rich Dad Poor Dad, tell us that an employee gets paid last with "hurt" money meaning after tax. Self employed people enjoy a better scenario.
Motels provide a free home onsite and the office provides all the office stuff which is tax deductible that I assume you are currently paying for at home out of after tax money. No commuting to work. Car is deductible, clothes deductible, many living expenses are indistinguishable from costs of running the motel kitchen, laundry and back office. You don't get personal bills like electricity, gas, water, internet, fuel, phone, mobile, puters, mortgage or rent, the business gets them. Without going into too much detail, you are correct that living expenses are very low in a motel.
30% ROI is nett after paying normal leasehold motel business expenses, provided you purchased at a price where the nett is 30% of the purchase price. Working hours dramatically increase for the self employed in a motel, and at least double the normal 40 hr week, and every weekend, it's hard work but pays well. It soon sorts out the hard workers and the highly motivated from the armchair admirals.
You need to pay your own sickness & accident insurance, income protection insurance, super, bank interest, accountancy fees, and enjoy the deductions from those as well.
What are your thoughts on this ?
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Newcastle Expressway from F3 to Branxton will have effects in the area so get on the right side of that situation. RTA estimates say 30,000 less cars daily on the New England Hwy through East Maitland and past Maitland as a result. Good for some, bad for others.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi Kindren.
Very kind words thank you, but what's really warming is your success, congratulations on your purchase and we hope it increases. Sorry I don't recognise you from your Forum name or the details. Please PM me or give a hint, if you like.
Website looks fabulous, thank you for the link, makes you want to book in.
All the best.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi Purelle.
Shed or at least a carport for a car very important.
How's the heating ?
Aircon or evaporative cooler. ?
Good insect screens.
HWS condition ?
Fences / pets ? Lots of rural tenants have dogs.
I'd fill in the pool.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi Royce.
Salary $137K and you're giving Dad $50 every 3 weeks, ? well I spose it's the principal of the thing but I suggest you make it a coupla grand and start your journey on a better footing.
If you're not sure where you're going and how to invest, Terry certainly has the expertise to make it as simple or as comprehensive as you need, but with flexibility, which you need when there's indecision.
I'd be living on the $37K and investing the $100K p.a. for a few years, while the going's good.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi Tracee.
I'm a motelier with serviced apartments as well.
I pay all the expenses, including cleaning and finance costs.
If I could find someone to lend me 70% of the cost of each room or unit at 6%, who also pays the cleaning fees at double the true cost, pays me commission on the bookings, plus management fees, I'd be better off – it'd be called a block of managed serviced apartments. But I prefer to operate it as a motor inn with serviced apartments and no investors involved.
The investor returns are usually lower than the apartment managers can get commercial finance. If you get my drift.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi Bacon.
Is the a/c working properly ?
Firstly, is it rated as big enough for the size of the apartment ? Are the filters and especially rotary fan blades clean and dust free ? It's amazing the difference in temp achievable when filters and rotary fan blades are cleaned, especially if they're partly clogged.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi Steve. Agree with Richard – talk to Jamie or Richard who have experience in loans and experience in securing loans from Banks, rather than trying to do it yourself. Banks love the inexperienced walking in alone.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Providing prospective buyers with full financial information on a property is the agent's responsibility. If he hasn't got it, tell him to get it, it's an important expense.
cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
well done, you took control.
Agents can sell quite well without low behaviour, but some don't know any better.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
LeanneB wrote:Hi the crest,. We have been told be a broker that the lease is given when an offer has been made on the property. Is this the norm?
LeanneB
Hi LeanneB.
Not the norm, and not true. Suggest you deal with someone else. The terms and conditions of the lease can affect the value of the leasehold so a copy of the lease should be available same time as the P & L's and careful reading and full understanding of the lease forms an important part of your due diligence, so how could any reasonable broker with nothing to hide expect you to make an offer without being given a copy of the lease.?
Some leases are so oppressive and onerous, valuers react negatively to them. Those leases reduce the market price.
If you are ok with reading legal verbiage for about 35 pages with the lease, then as you read through, make a list of the following :
what items does the landlord have to pay for to replace or repair; same for the tenant;
how is the rent increase calculated, and graph rent increases out for 5-7 years and see what it amounts to;
in the case of partial or total damage by fire or flood, is the landlord required to rebuild;
how long before the lease expires;
are you held over as a guarantor for the new lessee if you sell the lease in the future (unbelievable but true);
if it's an older motel, who pays if you have to excavate to fix old plumbing or stormwater or wiring (you can't inspect it);
List all the things you have to pay for in the lease, inspect them all to assess their condition and the likelihood of that expense, inspect all the motel for likely expense, and make allowances accordingly in any price discussions, and don't forget the signage which is expensive and makes money or repels guests. Naturally you must get well informed legal advice for yourself and make your own decisions based on your own due diligence.
Always best to use a specialist in any field if you can find one. Otherwise, use one who is capable and at least has your interests at heart.
Some brokers recommend their own experts, but that seems very close to vested interests to me. Can't see their expert suggesting you don't buy something the broker wants to sell you.
You're blessed with your kids and their background.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Good opportunity right now to assess how heavy weather affects motel properties for sale. Those unable to get flood insurance are at risk, according to the insurance companies.
If the motel is not covered for flood, then any interruption to business or any other event attributable to flood is not covered.
You wonder why some ppl ignore getting insurance. If the SES closes an area in case of flood, you can't claim interruption to business unless you're covered for flood, even if the event was a fizzer.
Not a fan of insurance companies, must be a huge club by now, and growing.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi LeanneB.
Busy hwys go east/west, and go north/south. Where they intersect is a good start. The map will tell the story.
Some towns are destination towns if they have enough to offer, some are only through towns because they lack natural or man-made attractions. You can search for those figures from Visitor Information Centres in those locations. Councils and RTA (now RMS) have traffic counts, but getting cooperation from RTA would be doubtful. Also the ABS provides detailed information like Occupancy for towns and regions. Strong businesses need good reasons why they have been strong, and those reasons need to be proven to be enduring.
Leases are a lengthy subject, they must be well read and fully understood by someone on your team. If it's under 20 years, expect to want to buy more years down the track, and the landlord might say no. Best time to negotiate more years is when buying – the vendor can probably negotiate more years at that time better than you. Very important items in a lease are – who pays for repairs or replacement of what items; how is the rent increased; is the landlord required to rebuild partial or total damage like fire, flood etc; but you MUST get legal advice re leases and buying a lease, be guided by your solicitor.
We raised 2 kids in hospitality like motels, very challenging, very educational for them. They like being useful, plenty to do. Casual work pays too. SOHO is never easy. It helps if the school bus stop is closeby.
Good luck
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
It's certainly comforting to know it takes at least 2 years. I'd definately want my broker to be as experienced as possible, grey hairs look good in this field, too much at stake. Nothing beats years of experience, so if you want in you've just gotta do the hard yards. Good luck.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
It's a popular investment area
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
rusty05 wrote:Oh, one other thing… when brokers list under the categories of Freehold, Leasehold or Investment Motels does it typically mean Freehold is with no lease in place and Investment is Freehold with a lease in place (as in a passive investment)?Ta!
Hi Rusty. You got it right. Investment sounds a bit generic but with a lease there are only 2 sides to it, landlord and tenant, so they call the tenant side "buying the lease" and the landlord side the "investment". You can buy or sell either.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Choady is on the money. People say it's not just what you earn but how much you keep.
If the goal is important, then shop frugally, live as cheap as a mouse for a month, just try it,, turning off lights like mad, reduce heating or cooling, walk anytime possible instead of the car, delete bought lunches and cappuccinos, stay home, do everything yourself. It's only 30 days, and then u can ease the choker in alternate months. You'll amaze yourself.
What's your goal worth to you ? You'll soon find out.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi JPHoth.
Can you update us on your purchase and how it's going ?
Hope it's a success.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Hi APWPG.
Not sure what you're seeking, so you need to post specific details.
Cheers
thecrest
thecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
