I am in the middle of reading Steve’s book and I find it very interesting. However, it has just dawned on me that what he is doing is very honourable to try to help other people better their lot but in doing so, and because his book has become a bestseller, it is actually like a double-edged sword. Because of the number of people who have read the book and want to implement his strategies, this is going to mean the competition for properties is going to be fierce and will probably force the prices of the choice properties to a neutrally geared level, defeating the purpose ! Unfortunately, I live in Sydney. I have already had a quick look at regional centres in NSW and the prices being sought are ridiculous ! It cost Steve very little to drive to Ballarat in 1999. However, I now probably need to get to WA, TAS or NZ to check out the sort of properties that I might be interested in and it might take many visits to secure anything – I understand the trips are tax deductible but flights, hotels and car hire are pricey and will already eat into any potential ‘profit’ I will make on any property I might purchase. If I follow Steve’s guidelines, buying ‘sight unseen’ is a foolish move and one I wouldn’t be happy to do under any circumstances. I just realise that I am getting more and more discouraged the more I write this article. Does anyone have anything to say to cheer me up at this point or have I captured it in a nutshell ?
Hey Peterhen,
Does anyone have anything to say to cheer me up at this point or have I captured it in a nutshell ?I believe it is how you look at it. Yes the book is a best seller, and yes people will want to implament his strategies, but there are a lot of people who aren’t actually doing much. It may be harder to find +CF properties at the moment, mainly because of the high interest rates. But f you look that little bit further you are bound to find the perfect investment.
Good luck with you investing.
Matt
“If you do what you have always done, you will get what you have always had.”
“Isn’t it time for a change?”
Hi,
I think that perhaps you echo a sentiment that a lot of people feel after reading the book.
Yep – it’s pretty hard, yet there are a number of factors that will time and time again prove that deals are out there. They are (in no particular order):
1. I believe the best way to make money in property is to find problems and solve them. As we move into a buyer’s market, there will be a lot more problems to solve.
2. As you’ve found – this +ve cashflow investing game isn’t easy. Those of lesser resolve will fall by the wayside, just like the ‘Andrew’ character that I outline towards the end of the book. Investing in property is already out of vouge, which isn’t a disaster… it just takes the hype away (a good thing in my opinion).
3. Despite being a bestseller, the majority of property investors still prefer the tried and tested approach to saving tax. Today, positive cashflow is better understood but is still a relatively niche market.
4. Don’t be afraid of change. Sure, the market has moved since I bought in Ballart in 1999… but the markey is always changing. Three years from now some people will be outlining how much success they have enjoyed while others are lamenting about missing out. You need to modify your investing approach to capitalise on opportunities in every market.
5. Focus on reasons for taking action, not doing nothing. There will always be valid reasons not to budge from a comfort zone, yet these same reasons are really invisible handcuffs that quite often keep people living in their own worst case scenario.
6. Finally, if you believe you can – you might. If you believe you can’t – you have no chance at all.
Thanks for your post. Hope you had a great Xmas.
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi Steve,
” As we move into a buyer’s market, there will be a lot more problems to solve.”
What can we expect as we move into a buyers market? I can foresee that as interest rates increase to around the 8.5% mark (Making Cents of the Statistics / Melbourne market) that the decrease in demand will dampen prices a bit, but as investors we will still have to juggle interest rates against price. What other problems can you see in a buyers market?
Cheers
CroccoHi Crocodile,
What other problems can you see in a buyers market?Same problems, as if investing in metropolitan areas, though the only difference lesser chance of acquiring a +ve cashflow property.
cheers
s.i.sSome problems will be highly geared investors, who cannot cope with the massive -ve cashflow they are getting, and need to stem the tide by selling – hopefully to realise enough to pay off the debt, but it depends how much they are losing per month. They might sell at any price to get rid of it.
This could open up ‘bargains’ for you – you could see ways of making the investment +ve cashflow, by a) paying less, or b) adding value in some way.
Cheers
MelHi Mel
Is it possible to find out early about foreclosures in Aus? In some of the American books I’ve been reading there are ‘systems’ to profit from them – I gather waiting outside a courthouse or similar and making an offer to a likely looking person (maybe easily identifiable by the tear tracks?)
Seems a bit morbid to profit from others misfortunes, but as they say, you make your profit when you buy.
Cheers
CroccoCrocco, I think Aus privacy laws are a ‘tad’ more stringent than the US, so there’s no way like they have to find out about impending foreclosures.
The best you could do would be to talk to your network (accountant/banker/solicitor/real estate agent etc) and tell them that you could be ready for a quick settlement if they know of anybody that needs to sell quickly or they will lose their place. You also MUST be able to settle quickly[
]As for profiting from others misfortune – it’s not a nice thought to prey on them, but you didn’t get them into the mess, but are looking for ways to possibly save them from losing the lot anyway, and at the same time, you want a discount for helping them.
Cheers
MelFestive Greetings,
Mel is right about foreclosures. Unless you get to the vendor before the foreclosure, banks are:
1. Unable to release private details due to privacy laws; and
2. Must take the property to auction so that there is no implied funny business.It is the same in NZ, however it is possible to broker a mass buy-out privately and do the occasional foreclosure pick up.
I think the same will occur here too as the market turns and auction clearance rates fall… you’ll be able to negotiate a great deal after auction if the property doesn’t sell.
In the States, people run classified ads asking people in financial trouble to call them because they buy houses fast and pay cash. Perhaps this market will develop here in Oz???
As for opportunities, who can tell? I just suspect there’ll be more problems calling for people with solutions.
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Dear peterhen
Personally I absolutely agreed you. but what can we do? Keep on or Give up ?As Steve McKnight said “if you believe you can – you might. If you believe you can’t – you have no chance at all.”
I used many many hours weekly in computer for searching the deal , but nothing happen.
of course, I keep trying.
I am sorry I can’t cheer you, as i is anohter “you”.[
]
JulianDear peterhen
Personally I absolutely agreed you. but what can we do? Keep on or Give up ?As Steve McKnight said “if you believe you can – you might. If you believe you can’t – you have no chance at all.”
I used many many hours weekly in computer for searching the deal , but nothing happen.
of course, I keep trying.
I am sorry I can’t cheer you, as i is anohter “you”.[
]
JulianPeterhen wrote:
>I understand the trips are tax deductible
My understanding is that the initial trip to an area to buy a property isn’t. However subsequent visits to do an inspection or maintenance are.
>but flights, hotels and car hire are pricey and >will already eat into any potential ‘profit’
I would suggest looking at ways to cut costs while having fun and making it more a holiday.
Let’s look at each of these in turn, based on what I learned from my two trips to WA last year:
Flights: The most expensive part of the trip. The coach or train might be cheaper and you get to see scenery. On one of my trips I found there was a backpacker discount card that gave me 50% off the Indian Pacific. So I cancelled my coach booking, saved myself over $100 and took the train (much nicer, saw the Nullarbor and no stops at expensive roadhouses).
Accomodation: Backpackers will put you up for around $18 per night. Even if you stay 7-10 days, that’s affordable.
Food: For two meals out of three buy from the supermarket (cereal, juice, fruit for breakfast & rolls/sandwiches for lunch). Eat out for tea (<$15 ea).
Car hire: though having a car might have been good to look at more suburbs, I didn’t find it necessary for the properties that I was interested in (well-located in regional cities) as they were within walking distance of the CBD. I did go on long walks through other suburbs though, but it might have been better if I hired a bike. A taxi could have been another option.
Phone calls: Carry the mobile, but only use it to recieve calls. Use a phone card and phone box to make calls if one is nearby.
Overall total daily expenses should be about $40 – certainly no more than $60.
Assuming that the whole trip costs $1000, that’s little more than 1% of the property price and small given that you’re setting yourself for the future and having fun now!
Regards, Peter
Excellent tips peterp, and ones I use myself… good to see the glass is half full…
Cheers
rcheers to everyone who has replied….I appreciate your support. I think this is going to be a great reference site going forward.
Peterhen,
As they say persistence pays off.
My biz partner and I have been looking for +ve properties for quite some time now…… suddenly we are starting to find them.
Increasingly though, we are seeing deals of other kinds popping up, which with a little work could net us more $$$….
Kits the streets, look around, find a few good agents, get them calling you….
it DOES take time…. have patience !
Cheers
Scott
thanks Scott
I notice your location is Singapore. Are you buying in Asia ?
Peter.
PeterP, I’m going out on a limb here because it could be that Australian and NZ taxation rules are slightly different in terms of claimable expenses, but I put the above scenario to my accountant and he said costs (and remember this is NZ I am talking about) involved in a property purchase are capitalised and depreciated, that is they are not directly claimable, but if one is to go to an area to check it out generally (as in, ‘to get a feel for an area’) it is a business expence, and can be claimed accordingly. Are there other accountants on either side of the Tasman that can verify this?
Cheers, Julian (not the same Julian that posted earlier on this site)
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