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  • Profile photo of woodrowwoodrow
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    @woodrow
    Join Date: 2006
    Post Count: 8
    Originally posted by DraconisV:

    Its also quite ironic when I asked that sock colour question as a joke as I only have black socks. For school and for work so its easier to have all black. And black ain’t a colour so guys that easy question has no answer. :)

    This strange comment had me intrigued, so I went on a search to the humble dictionary to assist.
    Ironic: containing or exemplifying irony: an ironic novel; an ironic remark.
    Hmm…not a big help, so my search led me further.
    Irony: the use of words to convey a meaning that is the opposite of its literal meaning

    Ahhh… there we go. A definition to work with. Now the next challenge, fitting that definition somehow to your strange comment.
    No dice. There is no way I could incorporate the commonly held definition or irony into your statement. Quite the conundrum I think you will agree.
    Grasping at straws, I began searching for random words in an attempt to find something to fit the statement. Perhaps instead of I, he meant to type MO? lets see:
    Moronic: a person who is notably stupid or lacking in good judgment.

    DING DING DING!!

    Profile photo of woodrowwoodrow
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    @woodrow
    Join Date: 2006
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    Originally posted by DraconisV:

    Just a general question here, what price range for residential property(particuarly houses) recieves the highest yield.

    I’ve heard recently that the rent per week for a 400K should be 300-400 a week. But for a 200K its like 250. which leaves the 400K one with around about 4.55% yield. But with the 200K one its more like 6.5%

    Where are you getting these figures from? They are completely meaningless. There are properties worth $2million that rent for $3,000 per week, and properties for $100,000 that rent for $80 per week. It depends on where the property is, what condition it is in, what facilities it is near, etc etc etc. There is no generalisation that says a particular price range gives a better yield.

    4.5% to 6.5%. Why would you buy a 400k property, i know more capital gains in % terms but if you buy 2 200K ones then you get he same cap gains(not exaclty) and you also benefit from much more rent.

    You have completely contradicted yourself. You cant say “I know more capital gains in % terms” and then say “you will get the same cap gains”. It makes no sense. You are again making generalisations about a price range that are meaningless. A $1million property can grow at 20% pa and a dump worth $80k can grow at .5%. You need to forget about being this specific, you cant see the forrest for the trees. Go to realestate.com.au, look at different rents for different locations for certain houses, then go see how much similar houses might be worth. At your stage I would suggest not even worrying about things like this.
    Go read all you can find from the following authors:
    Margaret Lomas
    Jan Somers
    Peter Spann
    Craig Turnbull
    Noel Whittaker
    Terry Ryder

    Plow your way through those books, you will learn a tremendous amount from a few different viewpoints. Some are aggressive, some are more conservative. Learn where you fit in with your own feelings towards risk. Develop an overall plan and strategy.
    Then after this start looking at properties in areas and of the type that fit in with your preferred strategy. Research how much things actually go for (not the rubbish estimates you have posted previously, they are meaningless), research market rents of that area. Then get your finance sorted out (you will know a lot more about this after reading the above books). Then start looking at specific properties. Forget about what colour you are going to paint the house, until you know what house you are going to buy and how you are going to buy it.

    Profile photo of woodrowwoodrow
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    @woodrow
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    ok here we go:

    “you don’t have the right to say that just cause we are young that we have an highly unlikely chance of sucess together in a relationship over 12 months”
    It is not me that is saying it is highly unlikely you will be together, it is statistics. As I said, it is not impossible that you will, but highly unlikely.

    “Yes I know i’m only 18 Woodrow and that I have no real investing experience, what do you expect me to have tones of properties or to have lived through it all.”
    No, no one expects you to have “tones” of properties or have lived through it all – unless of course you decide to give your girlfriends father, who probably has lived through a fair bit, advice about where to invest his money when you have no experience of your own to draw from. If you dont know what you are talking about (and lets be honest, you dont) then it is completely arrogant to think you have any right whatsoever to give this man financial advice without any knowledge or experience yourself.

    “Its obvious the poster was in a similar situation to your Girlfriends Dad – and someone like you came along who was young and enthusiastic and made him feel like an idiot. “
    Yes, that much is obvious from my post. I feel like a complete idiot. It couldnt be that I am simply annoyed at the complete and utter arrogance of the question. To paraphrase ‘wahoo, I am in high school and have read a book or two about property investing, and all of a sudden I think I am in a good position to be dishing out financial advice to someone far more experienced than myself.’
    Another poster (sarcastically for the slower among you) referred to it as “the infinite wisdom of youth”. Seems a fairly apt phrase in this instance.

    “I would like to just say that I will be asking many more questions on these forums whether they be huge or even as tiny as what colour socks should I wear. I’m going to ask and learn and nothing or no-one with any view is going to stop me. “
    And that is why this particular property investment forum is a pile.
    Yes, post about what colour socks you would wear. It would be as relevant as “should I put a rain water tank on my rental property that I am going to buy for $200,000 (but will actually be worth $900,000 because I will buy in the mountains and put a rainwater tank in it, and put a carport on it, and these figures are actually conservative given my vast knowledge of the property market, great experience in buying below market value, tremendous renovation expertise, and psychic ability to know what the property market will be like in 10 years when I buy a property).”

    Sure this post is about as nice as my first one. Perhaps it is not “sugarcoated” like some other posters like. You just get upset because you got offended by it, not because there is anything particularly offensive about it but because it hits close to home.
    The fact is, I never once crushed your hopes and dreams. I basically said stop thinking you are so crash hot as to give someone advice when you know nothing, and spend time on actually learning for yourself. I challenge you to go speak to your girlfriends father about it. Tell him how much you know about property, how much you know about shares, why he should invest in property, how it can help him reach his financial goals. Then when he slaps you down for being an insolent, you can come on the forum and ask what is the best treatment for facial cuts and bruises.

    Profile photo of woodrowwoodrow
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    @woodrow
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    Originally posted by Wylie:

    It is possible some insurance companies may take the view that if your house is worth $200K and you insure it for half its value, they can decide to pay you only a percentage of the insured figure. I suppose they assume you are prepared to carry some of the risk yourself. You may only get $50K.

    I don’t know how many companies do this, but I do know that it is a real risk with under-insuring your properties. Not a risk we are prepared to take so we make sure we fully insure our properties, even to the point of slightly over-insuring them to be on the safe side.

    Don’t forget to add into your insurance calculations the fact that clearing a burned house costs money and you need to add that on as well.

    Wylie

    Wylie
    An irrelevant post to an irrelevant topic. Well done!

    Profile photo of woodrowwoodrow
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    @woodrow
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    Draconis
    considering you have absolutely no investing experience whatsoever, have not been interested in property through a single property cycle, have in all likelihood absolutely no idea about the share market (or even any experiential idea about the property market), are not that widely read, have only been reading a few investment books for a couple of months, have no solid foundation on which to build any sort of argument about what anyone should do with their money, have absolutely no idea on market prices at all (i.e. “would go for 270K(if an obsessed buyer bought it). An investor would buy the same for 220K” – what basis do you have for saying this??), maybe you should keep quiet and not say a word to him?
    Maybe give him a book you found informative, and ask him if he would mind reading it and giving you HIS opinion on it.
    Maybe you are not really in the best position to be selling an investment strategy to your girlfriend either. First of all, at your age it is highly unlikely (though not impossible) that you will even be together in 12 months time. Second, I am sure she is just as intelligent as you are (maybe more so) and perfectly capable of drawing her own conclusions and judgments about what is best for her future. Again, give her a book, ask her if she would mind reading it, then discuss it with her (not coming across as the expert you clearly consider yourself to be).
    On that note, perhaps you should take a bit of a reality check – enthusiasim is great, but either decide you are going to invest in the very near future, or stop asking ridiculous questions about whether you should buy in the mountains or whether you should put a rainwater tank into a property you are intended to buy 3, 4, or 5 years into the future when the market will likely be completely different, as will your own plans, maturity, understanding, and logic.
    These questions are completely and utterly useless unless you are considering a propective purchase in the very near future (ie months). No one can hope to predict a market of any sort 12 months into the future, much less whenever you finish doing hairdressing at tafe and can buy a property.
    Some advice: decide if you are going to do any investing immediately. If you are, make a plan and do it. if no, no worries, read a LOT of books by a lot of different people, and actually start to get some understanding of what you are talking about. Then, when you finally decide to do something, you will have lots of knowledge to draw on in making your decisions, you will be able to do it, and maybe make some money. Then you might be in a position to put forward your point of view to your father in law (notice i said “put forward your position” not argue or advise, you are a long way off that).
    Thanks very much for your time and informative questions and replys.

    Profile photo of woodrowwoodrow
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    @woodrow
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    i would love to live in the mountains, but I dont know if that is where all the baby boomers will go. The problem is that in the mountains the ground is usally not even, so there is potential for serious injury with an older person doing the gardening. a lot of times the mountains are far away from medical facilities which would also be important to older people.
    Also, in some areas mountain goats present major problems with eating peoples vegetable patches, and I know that my grandparents love their vegetable patch.
    When I am older I will definitely live in the mountains, so I will rent your property off you Draconis. It is better for me to rent a property and buy investments than to buy a place for me to live in because the interest is not deductible (except if you are in America I think they are allowed to depreciate their own house!! lol rofl!! that would be great! lmao!). Also if you do have your own house that you live in if you make weekly repayments instead of monthly you can magically save thousands of dollars on your loan and pay it off in super record time!!

    Profile photo of woodrowwoodrow
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    @woodrow
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    i read on a renovating website from america (i forget the address of the website though, lol!!) that adding a rainwater tank can increase the value of the property 4 times the price of the tank. So if the tank costs $5000 then the property automatically goes up by $20,000. Also i heard that rent goes up by at least $30 per week.

    Profile photo of woodrowwoodrow
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    @woodrow
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    Hi DraconisV
    (cool nickname by the way!)
    Just a couple of quick questions if you dont mind.
    Can you please tell me what software you use to calculate the value of your property and rental returns after doing your renovation? Your figures seem really really good, and I am thinking about soon investing in real estate and doing the buy-renovate-sell method that you have discussed previously, and I want to make sure I am doing everything correctly to make the most money!
    Also do you recommend putting a carport on all buy-renovate-sell properties? Do you have instructions on how to make the carport without council approval, if so do you think I could borrow them?
    Also just one last one (sometimes I talk a LOT but I want to ask lots of questions so I can make fast and good decisions when I can afford to buy a property!). Are you anyone’s mentor yet? I read a lot of books and they say to get a good mentor who is a few steps ahead of you in their investing career. You seem fairly knowledgable, and I wouldnt take up much of your time at all, maybe just email you some questions from time to time and see if you would mind introducing me to some of your contacts on the forum? If you already are a mentor to someone i understand, but otherwise i would love to be your apprentice if you dont mind!
    Thanks a lot! I cant wait to hear from you guys soon!

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