what is 11 second rule & advice please

Hey there Dot,
Welcome to the gang.
Good questions and ones that asked a lot.

1. 11sec solution – simply it is a filtering tool many use when looking for cash flow positive property. Rent of the property (/week) * 1000 /2 = around a 10% yield. This means to me and others that I will further investigate the property and see if the numbers stack up. Use the search function up above to find heaps of great links about 11 second solution.

eg. Rent $150/week then suggested Cost is $75000.
(before you say it yes they are out there).

2. As to what you need to do……it’s totally up to you. What I do is everything I do and spend on property and other things passes one test. Will this get me closer to my investing goal. If it is a yes i do it….If it is a no then I walk.

I am serious about retiring young and I realise that I need to sacrifice a few things now to get there. My wife and kids do not want for anything but we do try and not by doodads (please give her strength…..)
An example of this is my wife wanted to ski this year (it’s been 6-7 years) and I said to price it out. When she did with childminding etc. it would have cost over $4000. You know her words….That’s nearly a deposit. So the challenge was to use that $4000 so it would generate sufficient income to allow the trip and not touch the original capital (a little extra would be nice).
Well that $4000 needed to be $5000 but it has made us around $14000 in 45 days so maybe the trip is on. Then again my wife is keen to see that happen again so maybe next year for the trip.

Now I’ve been wandering a bit but what I am trying to say is that you must write down your own goals and always…always….always put them first. Only ever do things that will bring you closer to those goals not further away (Realise also that mistakes happen).

As to whether Positive or negative……how many negative deals can you afford to do and can you guarantee the capital growth. How many cashflow properties can you do and how much money does each one take or put into your pocket.

Questions for you to answer.

People may give you there opinion about location or cashflow but that is up to you. I personally believe that cashflow is a great way to start because if property faulters then you still make money. Also I will look at a cashflow negative property only if it has other benefits or options.

All this rambling ……hope this has helped Dot.

Enjoy
AD [:0)]
(Andrew)

“”Imagination is more important than knowledge. Knowledge is limited. Imagination encircles the world.”
Albert Einstein

Dot,
I’m just starting out in this game too,
but I’ve spent about 3 months doing my homework, and I’ve just made the first move.
Ive put in offers on two properties both returning over 12% gross. To be more specific they are both Queenslanders converted into two units. they are low maintianance for their age and have exeptionally low vacancies over the past 5 years. they are in a regional centre of approx 65k people with an exelent infrastructure,both are returinng $190 per week. one is on the market for 90k the other 73k but it needs about 10k in maintainance (I have quotes). you do the sums these properties make good sense and banks are keen to lend on them! The bouns in this deal is that the area is predicted to have large capital gains in the near future(surronding areas are already booming!)
these are real life examples, not pie in the sky figures, I looked at 35 properties in this city about 18 of them were well within the parameters of the 11 sec rule.
My advice get on the net check out chamber of commerce and local gov sites and then go through real estate sites for regional centres that look strong.
Also have alook at some of Steves products they are what got me going, especially ‘fast track’ its cheap and good .( Sorry Tails I’m not blatantly selling Steves products just stating my beliefs![8D])
Hope I’ve helped you with this! Good luck!
Best wishes,
Scott.

“Aim for the stars and you’ll shoot the top of the telegraph pole. Aim for the top of the telegraph pole and you’ll shoot yourself in the foot!”
-anon