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  • Profile photo of HamsterHamster
    Member
    @hamster
    Join Date: 2003
    Post Count: 10

    Quick question, what if :

    – interest rate goes up to 10% ?[:(]
    – vacancy rate goes up to 8% ie. 10% and up to 30% of your properties would be vacant ?[xx(]

    Wouldn’t any of the above factors start a chain of actions that could burn your house of cards down a la Alan Bond scenario ?

    I would appreciate it very much to hear all your inputs, just to calm the nerve a bit.

    Hamster.

    PS: Great site by the way, I have forward it to all my friends.[;)]

    Profile photo of FWFW
    Member
    @fw
    Join Date: 2002
    Post Count: 478

    Hi Hamster
    This is why it’s usually recommended that you have access to a LOC or have some money in an easily accessible investment, such as shares, as a contingency.
    Also, once you have a few cashflow positive properties on the go, your overall risk is lower, because you can cover a couple of non performing properties with the surplus from the others.
    I’ve already found this – my 4th wrap property is only just settling, and yet last month payments from the other 3 covered the costs of all 4. That was nice! This situation should only improve with more houses.

    Keep smiling
    Felicity 8-)

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