http://moneymanager.smh.com.au/property/guides/articles/prop01.html
….”It all makes sense if you expect the return from your property investment to comfortably exceed your cost of borrowing. But when there is not much of a difference between your expected property return and the cost of finance, not much needs to go wrong before you are losing money.
“…..”Beer says that too often investors buy into the same rental market that they live in and, while there are undeniable advantages of investing in an area that they know intimately, they are missing out on diversification and other opportunities says Beer. One of the little known high yielding property investments, he says, is from rents on houses in regional towns such as Griffith, Leeton, Albury or Dubbo. Often the rent is as high as some real estate in cities but the purchase price is much lower.
“The house prices are more affordable and the rents paid by tenants are comparable to metropolitan tenants,” says Beer. “
Quite.,,,”You want a place that is attractive to renters. If you buy a place that is already tenanted, then you are really lucky. It is rare to find a tenanted place on the market. If it had good tenants then why would the investor want to sell it,” says Smeaton.
i don’t know, but I’ll buy it…
“His advice to property investors is to keep your investment property occupied. He says it is important to buy a unit or house that is low maintenance and does not require a lot of money to be spent on upgrading it.
“Buy a place that is not a renovator’s dream. You want a place that is attractive to renters”
Makes sense doesn’t it? If you have a place that tenants want to live in, they’ll choose yours over the skanky feral option down the street!
And people take the x#$% out of +CF property…
CD[nowords]
CastleDreamer
I only somewhat agree having done two renos.
Part of the reason i got them so CHEAP is that they needed maintenance and redecoration (but I must stress, were structurally sound.)Solving people’s problems is the way to make money in real estate. i learned that from a certain millionaire property GURU
hey GURU, yeah you, the cute one with the glasses and the cute smile,
*yells and waves*
you ever read this forum any more?????yah, so, ongoing annoying maintenance issues are obviously no good, but sometimes you add up the costs and it’s worth doing, like i reckon mine were.
Yep your right, I guess I read the quote in my post as meaning really ‘don’t try and rent out the renovators dream!’ let someone elses skanky unrenovated dream be the property that sits vacant. Yours aren’t skanky renovators dreams anyway Mini, you did them up and now they are cute little properties with Cash Flow AND capital growth!! All power to you…
CastleDreamer
the article makes good sense… was looking at an office suite that delivered 8% and little chance of capital gain. The finance rate was 8.25% so why would I bother? CF+ advocates are basically applying commercial valuation methods against residential property. CF- are coming from a completely different angle
Extensive list of new Perth property available for sale.Alternatively, become a joint venture partner in one of our property development partnerships – contact me to find out why our developments are unique. John – 0419 198 856
Aus prop, totally, and that’s exactly how I see my IPs, like little mini commercial properties. But because they are residential, they have the best of both worlds…returns which after costs including full management break even around 10 percent (same as a decent comm. prop) but also have capital gain, because it’s residential, (despite the fact they are in towns where people told me i wouldn’t get capital gain, and one of my properties has probably gone up 50-60 percent in one year. then again I did get a good deal at the time too, but then again I always get a good deal hehe)
Also, no matter what the economy is doing, recession or boom, my properties will always attract tenant, as it’s a below medium price and rent property, and so no matter if people are moving up in the world or downgrading, I should be all good – unlike commercial properties, which tend to suffer in a recession as people move to working from a ‘PO box’
Mini,
Thanks for sharing the article.
PK
I reckon the towns they’ve mentioned- griffith, leeton, Albury, Dubbo- are too exxy. You can buy an IP of similar if not better wuality for a similar price in parts of Qld, and it’s … welll.. Qld.
I was amazed by the beauty of Qld when I went there. If ya want leafy, surely one would buy in Qld (and I don’t mean the Qld outback or mining towns) more than they would in Leeton? (I do know these rural areas, by the way, plus outback ones like dubbo- which will always be a country town, in my opinion).
kay henry
There are always good opportunities you just need to take action and snap them up.Some great commercial deals around good for long term tenants and very little overheads.[biggrin]
So many +CF properties out there.Let me help you and achieve a win win situation.Russ.
Thanks for the link.
Interesting article.
CarLover
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