Hi All,
My name is Wayne, I’m 23 – and eager to get into proerty development as an investment and business.
I currently own a rental in Merriwa (Perth) and a block of land in yanchep. After raising equity of around $80-$100k I’m now wanting to sell up what I have and use the profits to start developing and trading property. I will most likely just sell the merriwa proerty initally.
I consider myself an agressive investor, therefore have gone down the road of developing property.
Basically, before I begin developing I’m wanting to find out the best way to structure this type of venture, to avoid things such as capital gains etc.
Can anybody give me some advice on the best way to approach this? Is it to set up a family trust, then assign a company to manage that trust? With me being the company?
Also, if anyone has any other advice or have developed property in perth – it would be great hear from you!
Thanks in advance for any adivce!
Wayne
PS, I’m a web designer by trade – great to see so many people utilizing this wonderful website!
Wayne Leech
http://www.landsearcher.com.au
http://www.homesearcher.com.auHi there,
My partner and I sound very similar to you, we both just turned 24, and want to get into property development (relatively small scale). We own a house and have just loaned to buy another, which we will probably sell in a year or so. We live in QLD, South East.
Perhaps we could help each other out? Or share any info we find as we are not vying of land lol
Dani
Hi Dani,
Sounds good! Hopefully some of the experts in this forum can help us out:)
Wayne Leech
http://www.landsearcher.com.au
http://www.homesearcher.com.auHi Wayne,
Congratulations on your achievements to date.
I noticed from your thread that you are contemplating a trading approach to property investment.
Be aware that everytime you buy and sell property you will be hit with CGT and also stamp duty. As such your profit margins will be severely eroded and compromised over time. You may find that develop, kepp one and sell the rest is a more profitable way to go over the long haul.
Selling isn’t necessary to realise your gains – the gains you have made can be used to increase your equity levels and the funds available which then provide funding for subsequent investments.
Trading also has the added ‘X factor’ of the property market cycles and requires proeprty to be bought and sold at the right time in the cycle to maximise profits. Whereas a long term investor isn’t quite at the same mercy of the property market.
Just a slight variation on a theme for you to consider.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
waynel2
Agree with Derek here..
You want to Avoid paying CGT as a property trader ?[blink]
Have a look at book by Peter Spann, “Wealth Magic”.
Re: Property Developing In Perth..PM Ausprop or David Femia, Me , i’m more into Buy and Hold, however, each to his own..[thumbsupanim]
REDWING
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow CalculatorHi Direck,
Thanks heaps for your help and advice! Much appreciated!!!
Yes, stamp duty and CGT does put a damper on things, however I’m having problems raising the equity needed for my long term goals (which is triplex plus developments) therefore I hoping to build and sell two new properties over the next two years to try and raise $200k to fund future developments – such as as a triplex development closer to the city.
I know in this game, time is seen as a major factor to create wealth, however if I can develop and calculate profits on the current market value – without taking into consideration future capital growth then unless the perth property market goes belly up I think things should work out.
Can I ask – have you built duplex/triplex developments in perth?? If so how did this go for you?
I talked to another developer and he suggested to look at building single New homes as he thinks this can be just as profitable as subdividing and building a number of smaller homes. Do you have any comments on this?
Thanks again
Wayne Leech
*Below are links to my websites – any feedback, comments would be appreciated:)
http://www.landsearcher.com.au – List your land for FREE (Private sellers only)
http://www.homesearcher.com.au – List your property for FREE (Private sellers only)Thanks for your advice Redwing. I’ll get a copy of that book and have a chat with Ausprop or David Femia:)
cheers
Wayne Leech
*Below are links to my websites – any feedback, comments would be appreciated:)
http://www.landsearcher.com.au – List your land for FREE (Private sellers only)
http://www.homesearcher.com.au – List your property for FREE (Private sellers only)Wayne
Hi, -Im also 23, originally from Perth (Sydney for 9 months now!) Its scary over here!
If I were you, Id stick a house on the Yanchep Block ASAP and get a tenant in there.
Keep Merriwa its a good spot. Marmion avenue will be up Yanchep way by 2010 (I think?) and the freeway and train arent far from Merriwa now!
Good coastal spots Id keep them mate!
As you know, coastal WA is the place to be! I grew up in Marmion and prices there have gone thru the roof!
With the expected CG in Merriwa and Yanchep, use your equity to buy a development site close to the city and develop later.
Its easy to get excited about the “possibilities” tho
Where are you living? Still with the olds?
PM Me a message – stay in touch [suave2]
Luke [cap]
Hi Luke,
Good to hear from you!
At the moment I’m renting in duncraig, with the merriwa house rented out (positively geared).
Yeah I’m tempted to hold on to them – but if I sell up the merriwa house – i could then raise approx $290k which would allow me to re-invest into other areas which I feel will return more growth.
AS mentioned before, I’m very eager to get into property trading/development. Reason being that I eventually want to be doing this as a fulltime, or if not partime job.
I know I’m in a good situation to build up equity in with my current rentals, though this is more of a long term plan, and I don’t think it’s the quickest way to get to my goals.
With my current situation I keep hitting brick walls with the banks when trying to raise money, therefore selling up seems to be the only option which will allow me to expand my portfolio. I’ve often heard that once you’ve got equity in your first house, it’s easy to get 10 more – though it seems very hard to convience bank managers of this theory!
How’s the market over in sydney? Have you bought a house over there?
Yeah, Marmion is a nice suburb!!!
cheers
Wayne
Wayne Leech
*Below are links to my websites – any feedback, comments would be appreciated:)
http://www.landsearcher.com.au – List your land for FREE (Private sellers only)
http://www.homesearcher.com.au – List your property for FREE (Private sellers only)Hi Wayne,
I haven’t done any developments – I live a little too far out of Perth to ‘supervise’ a building project. I have certainly dreamt of completing such an undertaking – one day.
Project feasibility assessments can be undertaken with software vailable at http://www.devfeas.com.au and for some information on property development try http://www.smartpropertydevelopment.com.au.
I can put you in touch with a broker who also does his own developments. If there is a way for anyone to get finance he will know it. PM me if you want his contact details.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
I’m curios to know why you think it is necessary to sell the properties you have to fund the projects.
That’s what banks are for.
You really just need to learn to present the numbers in a way that the bank has no choice but to approve the loan.
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