hi leonid
i live inVictoria and i have purchased more properties outside of Vic than within.
There is no problem buying properties interstate, try to arrange holidays and property hunting together, QLD is always a nice destination.
All the paperwork needed to purchase is easily done without being there, fax and mail do the job. and when you do settle pay a property manager to look after the house. in some ways its better not being too close to a house it means that you can’t do the little fiddly jobs so you have to pay a handy man which is one less job for me to do.
By the way only 20% of my properties are within 30Km of me. Some are in Latrobe Valley 380km some in Adelaide 600km away and some 2000km away.
regards westan

yes mini you are right
i know that last year i was buying houses (in Millicent SA for 50k)and people were saying you could have bought them 10k cheaper 12 months ago. since then they have gone up 40k.
i’m not saying to you you should buy, but i am buying myself.
Be careful how much you take notice of realestate agents. they aren’t investors themselves (most aren’t) most don’t even own 1 investment property. so don’t take investment advice from them, weigh up what they say but they are only real estate sales people. occasionally you meet some switched on ones.
As for as trust homes go check out Elders they have the contract to sell trust houses in SA outside adelaide (they auction them). If i was buying in SA now i’d be checking out Whyalla. i know they had cheap houses a while ago.
westan

Sorry one other comment who would have guessed that Moe would have had better capital gains than Melbourne and Sydney over this time .
westan

Simo

don’t know much more about the gold resource than what i said, you may need to do some investigation through the papers over the past few days.
Re vacancy and prices, ring some agents and ask, i was looking about 18 months ago but ended up investing closer to home.
What you can do is use the internet. i have just looked up for you, there was an Auction on the Sept 2nd, chech http://www.elders.com.au. you could phone and ask what they sold for, how much rent will be, what need to be done and what demand is like.
To work out the return, find out the rent take away the rates / water, agent fees, insurance and the interest on the loan, take away about $10 pw for repairs the figure you are left with is the profit
regards westan

My ambition is to be Naked and have people not laugh at me.

westan

Hi snakey

the one for 40k rent of 120 sounds good, even though the second meet Steve criteria it wouldn’t meet mine it is only marginal cash positive,
I’ve bought sight unseen 3 time once was bad. A good house in excellent condition, i just underestimated how bad the neighbourhood was (Clarendon Vale TAS).
That was 6 yrs ago now i’m smarter (well i think hope i am) i check out the area a little more. I’d try if i was you to see the houses. How far away are they ?
westan
Now i

Hi leverage

yes i bought (only 2 and one for my brother at 26k) 6 yrs ago for 28k. The Power industry had laid off 2000 or so jobs and the Govt was selling off all their houses (hundreds) the housing prices absolutely crashed. even though the town was struggling its rental return was OK 110pw. Since then the Gov’t has spent 100’s of millions in the area to re establish the place, it has worked. The fast train will only help, the Uni at Churchill sounds like it is doing well. One reason i bought was because i knew that when the Gov’t stopped selling, prices would quickly move up (supply and demand). the town is working class, locals consider Traralgon better and Moe a little worse. There are some growing industries in the town.
Rents are now rising (last 12 months) the cheaper houses are getting 125-135pw. Having said all that i’m actually selling my houses in Morwell to reinvest in another market. if i wasn’t reinvesting i’d be happy to hold my properties but i wouldn’t be buying when the asking price is 90k+ and rent of 130pw.
hope this helps you a little
westan

Battz

it depends what you are trying to achieve and how it fits in with your own financial goals. its really hard to comment without knowing where the property is. Remember the agent is working for himself first the vendor second and you third. Good luck with your negotiation. Ask local property managers how many houses they have vacant and how long have they been (If long it may reflect on the condition of the property rather than the town). Ask what can you do to increase the rental return, look for ways you can add value to the house.
all the best
regards westan

Hi simon

that’s good to see are figure are so close to each other. Hopefully we know what we are talking about []

regards westan

Hi Battz

in comparrision to Simon this is what i get
ok lets assume you put in 20% finance and loan the rest at say 6% (you can get 5.65% at homepath.com). also assume purchase costs of say 3k.
Rent 200pw

less costs
interest on loan of 75,200 is 86.50 pw
rates estimate 800 15 pw
Water 400 8 pw
Insuarnce 300 6 pw
Agent management @ 8% inc GST 16 pw
Total costs 131.5pw

total profit 68.5 pw
You will have to pay for maintenance and will have vacancy periods, which will effect profits
$3,562 per yr. you put 18,800 plus 3,000 costs into the deal so a total of $21,300 This represents a return on cash of 16.7% (not High enough for a cash positive deal that i’d be after).
But if this is a Capital Gain purchase the figure look better. Forcasting the future capital growth is difficult but if you feel it is a long term hold then it should appreciate over the next 10 yrs. If the property was to average 7% growth then in 10 yrs the property would have doubled to be worth 188,000. the risk for you are
1. flat growth don’t expect quick capital gains as we ahve experienced over the past few years.
2. rising interest rates, you have a healthy buffer against rate rises.
whilst i say this property wouldn’t meet my criteria of a cash positive property it appears like it would met Steves 11 sec Rule.
But if there is the posibility of capital gains it could be worth investigation. hope this helps please ask any questions if you have them.
westan