What to do….

Hi there

My husband has been talking about “Positive Cashflow Investment Properties” ever since I met him almost two years ago and until recently I looked at the idea as a pie-in-the-sky, highly unrealistic one – “if it were that easy, everyone would be doing it?!?!”. I haven’t been working since March of last year when I left to have a baby and he finished work just before Christmas when we travelled overseas for 6 weeks. Since we got back we have also moved from Wollongong to the Gold Coast to be nearer to friends and family. Having now settled into our new home (which we rent), we have realised that one of us needs to think about working again, however living in such a gorgeous place and having an 8 month old baby, neither of us really wants to do something as tedious as going out to an office job!! I have vague memories of seeing you interviewed on TV a few months ago and thinking at the time that it must be luck rather than judgement, but it is really only in the last few weeks that I started to take the passive income thing seriously. I happened to come across an article on the internet which mentioned your book (0-130 Properties) and promptly went out and bought it. Within two days I had read it cover to cover and had ordered the Fasttrack tape which I listened to immediately – in fact, I only have a tape player in my car, so resorted to driving around for a few hours just to listen to it. A few days later and feeling highly excited/motivated/scared/etc.etc. we hopped in the car (having done some research)and trotted off to Dalby. The reason I picked Dalby was that they had spend a lot of time putting together a prospectus for their future. The population had been growing slowly but steadily and house prices were fairly reasonable. It seemed however, that everyone had got there before us and there were only a few properties under $100k. The concern I had for Dalby was that the population projections were not great….. so we returned home feeling a little despondent but still determined to find that deal!!!
Something we learned from the day out however, was that we had no real idea of a good deal v bad deal, so I promptly got on the website and ordered the Buyer Beware pack which I’m hoping will turn up today.

Having spent all of this week glued to my computer, searching properties, population and census statistics, areas for growth within certain regions and a number of other things, I am again feeling very excited. In fact I awoke at 4am this morning thinking about typing this e-mail and nearly got up and did it so I could get back to sleep!!!! So, finally, after all this waffle, here is my question….

I have been looking at Rockhampton and the surrounding areas. Now the area itself looks good with a number of future growth areas within mining, tourism and new international organisations moving to the area. As with most large towns, the rent versus the loan repayments are not great, so the returns are low, however the outlying area of Rockhampton looks much more promising. Some areas such as Yeppoon are already way out of our price range, however other areas still have very low house prices, such as Mount Morgan. Having read a report by the Rockhampton Council, it would appear that there has been a high amount of investors buying in Mount Morgan expecting good rentals, however looking at the population projections, they are expecting numbers to dwindle in the coming years, so either the other buyers know something I don’t, or they are not doing their research properly…… In both your book and tape, you suggest looking at areas that people are moving into, not out of, and we don’t want to be stuck with a house in 10 years time that no-one wants to rent because it’s a ghost town. What confuses me even more, is that all the information I can find suggests that all the other towns in the area (Gracemere, Stanwell, Yaamba, Biloela, Marlborough) are all due for increases in population, so why should Mount Morgan be any different???

Any advise would be greatly received (and if you’re still awake by the end of this e-mail, then you deserve a medal!!).

Yours confusedly
Sharon