Where to invest in Perth

Hi Wormit,

Peter has replied to this question in the other forum board.

I’ll add a few comments to his (read them too) – you have just read a book that has motivated you to invest in cashflow positive property – that is the easy part.

There is so much more you need to do – see how much you can borrow, explore the need for a trust etc, getting yourself out and about and know to REA, developing your own expertise in identifying a good buy or not (just because a REA agents says yes – doesn’t mean it is), finding conveyancers you can work with and and and and – you get the idea.

In some respects you are now at the ‘reality check’ stage and are just starting to come to realise there is hard work involved – it is not just a matter of opening up the West and getting the deals from there – the better deals have already gone.

I recommend you read some of the posts here (as you are doing) and start making notes – getting tips etc and then reread the book to distil the fine details required to make your joourney a success.

Hope this helps.
Derek
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Hi Wormit,

I have a different investment belief to most people on this board as I am a growth focussed investor who prefers to invest in areas closer to the city which have a long term growth history and which meet my criteria.

As to whether or not 8% is manageable, or good, for you only you can determine the answer to that question. Without knowing the area you are looking at (you don’t have to tell me either) I recommend you check the long term growth, rental demand & employment opportunities in the area, infrastructure plans, the short and long term outlook for the area, distance from large population centres etc.

I, for one, am concerned that many investors have become too focussed on the 11 sec rule without ensuring the other fundamentals also stand the test.

For example I was speaking to someone in a small town, with declining population, not far from where I live that sees locals selling up to eastern states investors chasing cashflow.

Local REA are having a field day and the demand for low priced properties is creating a ‘false market’ that gives these ‘johnny come latelys’ the belief that even these towns have growth – my question what happens in a normal property cycle and with a declining population.

Hope this helps

Derek
[email protected]

Read my comments? Think I can help you? PM or email me.

Agree with the above, i’d be looking for CG as well as positive cash flow with your IP’s.

Remember most loans are for a term of 25 years, so look long term with your investment.

Don’t purchase in some remote area on the edge of the desert with 10 residents, 2 dogs and a goat, just because it meets the 11 second rule.

Agree with Derek thet some locals in regional areas are ‘laughing all the way to the bank’ with some Eastern States Investors buying up thier Homes, not saying there’s no good buy’s just do your Due dilligence..[biggrin]

REDWING

“Money is a currency, like electricity and it requires momentum to make it Effective”

Collie… Note coal doesn’t last forever….Very cold place in the winter….

Success is 1% inspiration and 99% perspiration.

RussH
from experience have found that most people would prefer to travel from Bunbury rather than live in Collie. DONT KNOW WHY????

Goody, goody

As an Eastern Stater, I thought I would get in on this thread.

I thought the same about Collie last year and stayed well away. It looks dodgy with half of the town sold within 12 months.

I have actually just invested in Australind and I did the homework prior. I agree with Redwing that the area is taking off as a satelite suburb of Bunbury.

I will be over in May to look at my investment and any others that I may find.

I know the area a little and it has grown astronomically in the last 5 years. Collie may end up a bit of a ghost town.

‘Eat rich food, barbeque a yuppie’ [greedy]

You are correct, not everybody wants to live their, but the City of Bunbury is growing much quicker than Collie. It certainly points to a better area to invest for CG.

I think you will find that Collie’s prices have been artificially inflated by some Eastern Staters who think they have found the end of the rainbow. I see no reason for the prices to keep moving up and they will probably fall once the buying frenzy finishes.

No and yes, Russ.

The house is more than $120K and with depreciation is +ve CF by more than $35 p/w. Whilst it is only +ve through depreciation, it is still +ve and the CG will be so much higher than Collie IMHO.

Well, I can’t answer for everyone, but personally I am into making money. I have diversified my investment portfolio so that I have a mix of +ve, -ve and neutrally geared properties and shares. My situation is different to some, I realise, but I see this site as a way to learning about property investing and not just heading blindly down a one way track to the ellusive +ve CF property.

I don’t care what anyone says, good +ve CF properties are very hard to find now (not impossible). It has taken me a long time to find the ones I have currently. +ve CF properties will become even more scarce in the next 12 months IMHO but that won’t stop me investing.

When I was about 18 and started getting interested in the share market, my Dad told me always to diversify my investments. He has become pretty successful with his diverse investment portfolio, so I guess I am just taking his good advice.

I seriously doubt there would be many on here that would argue against diversification if they were in a similar position to me.

Even Steve says there is a point to investing in -ve geared properties. It all depends on what your goals are; what you hope to achieve in the short and long term.

‘Eat rich food, barbeque a yuppie’ [greedy]

Hi Wormit, I’m from Perth and pretty new to this forum as well. Look, I actually stumbled across a cash flow property by accident and through stupidity too – I’ll explain. The property’s in Midland, I wanted it because Midland’s a bit of a hot suburb and I was prepared to go into a heavily negative geared deal. The house needed work ($90 p/w tops) on a 1/4 acre etc and it had a large workshop down the back.To cut a long story short, the vendor wanted to rent the property back from me for 130 p/w, I figured he only wanted the workshop (which was right) so I fixed up the house for $3000 and now have both rented at 120 and 130 p/w respectively. Please don’t think I’m boasting, I just wanted to let you know that opportunities are there, perhaps not he traditional ones (country towns etc), but ones that require thinking outside of the square.
I hope this helps.

Warm regards
Dean

Dean…

Well done.. thats thinking outside the box…
A little off the topic, but how do the tenant separate the electricity usage etc ??

Midland… Is your block a development block also??

Congrats Dean..Midland has potential, and the Council there are “busting a Gut’ to get some solid business happening agian and harrasing the Government..

Still some cheap IP’s here..

And LOTS happening up North of WA[biggrin]

REDWING

“Money is a currency, like electricity and it requires momentum to make it Effective”