Multiplication By Division

It’s VERY unrealistic, especially now that you’ll be seeing a correction in these cheap country properties within the next 2 years.

The “11 second solution” is a 10.4% gross yield and is simply a yardstick. Obviously if interest rates rise, it will need to be reviewed.

Do a search on this site and you’ll get a lot of hits… it’s been done to death.

It may not be very realistic to expect this sort of return now, but it really did happen to a lot of properties a few years ago.

Terryw
Discover Home Loans
North Sydney
[email protected]

Yes I agree, I know it did happen….anyone with a toe in the market at the time would have known it was happening. And if you sold, then the money in the bank would have confirmed that it was real.

Terry: if this correction occurs in the next two yrs, what do you think will cause it, eg rising interest rates, distreessed property holder havinbg to sell, vacant rentals, simple correction because prices have overrun the market, ?
I am really curious to know what triggers these changes.

One thing that does concern me is the social cost of all these savvy city investors targetting these regional centres, snapping up all the property with their greater buying power and creative financing methods,which in turn keeps the locals out of the buying market and forces them to be renters.

I am not against the legitimacy of it, indeed in a free market and capitalist system, this is what you are supposed to do to get ahead.
But is there a social cost to this, and a backlash coming ?

I understand this is a global phenomenon ( UK and OZ investors descending on NZ for example) and not just occuring with Aus, but what will be the fallout from all this ?

Also, what will be the effect on all these positive geared investors if interest rates rise to ~10% in 2007-07 as seems to be predicted widely ? Is this the 2 yr. window you speak of ?

Artticle in the local paoer by Alan Kohler explaining that 20% of Australias home loans have been turned into bonds and sold on the global market at yiels of 5.65 to 5.8 % He then predicts that US rates are about to rise, possibly steeply which impacts on this 20% which could lead to a housing credit squeeze and a big fall in property prices (??)
He concludes that global rates are about to go up and it is irrelevant to the Australian property market whether Australian rates go up or not, as the fate of our property market is not in our hands or in the reserve banks hands.

Time to cash up and sit on the sidelines ?

Cheers…KP

Hi
I am new, (wish I had joined when I first bought Steve’s book) I echo what someone else posted where can you find an house for $40,000 or was that the “good old day’s”.

I have an investment property on the gold coast was neg geared, now positive ( had it 5 years) although I have been searching I haven’t been able to find any localities that would appear to generate a positive cash flow, does anyone have any tips?

Thanks

Cas

I have just moved to Alice Springs for a 2 year work contract, and am wondering whether it is best to buy or rent the house we will live in. What will this decision do to my intention of building up a portfolio of properties? The houses I am looking at cost $350/$400 per week to rent, and to purchase cost around $350K plus Stamp Duty of around $15K. Deposit would be $22K with a loan of $334K repayments $515 pw over 30 years. I own one house in Sydney which is currently rented out at $310 per week and providing positive cashflow of $30 per week or $150 depending on whether I pay principal and interest or interest only.

Mono,

Relax :-> Life’s too short for stress

Steve started his property journey at the start of an extended boom in property. Like many of us he is yet to deal with a sustained downturn in property, or property in a recession. I know you are an experienced property person Mono and have your own insights.

Steve exhibited admirable courage imo in the way he was prepared to make a change to his life and be creative with his investing solutions. Whether his messages and insights are less valid at the moment I’m not smart enough to judge. I know that smart investors make money in our society when change happens, whatever that change is.

I had the opportunity to talk to the smartest agent I have ever met (met a few as well) yesterday. He had some very interesting views on the economy, property and the property cycle. This family have been through 5! property cycles and are experienced enough to remember how property in Australia behaved pre 1950.. Something I’m yet to see any property presenter EVER talk about!

Here’s a personal observation: The biggest investors don’t spend their time on internet forums! They are too busy investing and making money

WaySolid

“Write the wrongs that are done to you in sand, but write the good things that happen to you on marble.” Arab proverb

Hi all,
I suppose from Steve’s perspective information is money and giving it away freely (that is absolutely no monetary or advertisement benefit etc) may not be something that he is interested in doing.

I have noticed that often some of the answers are pretty / very light. I think it also comes down to time management as well. What should you spend more of your time on? The things that will make you the most money and maybe that doesn’t include answering forum questions

This forum is a very good example of time leverage
i.e. leveraging other peoples time.

This may all sound a little harsh to some, but the reality is that this is a business and Steve is running a business and we are potential customers.

I not sure Steve owes us anything. However, I think (my opinion only) that authors of books do have some sort of responsibility to explain themselves at some level. Many may not agree with this.

Even though this is a business there are people who have put allot of trust and faith in what has been written, clarification and on some occasion expansion should be given freely in my opinion.

MarkyMark

We are pretty well saying the same thing Monopoly. I completely agree with what you are saying. When I first came onto this forum I sort of thought that Steve would be much more active than what he is, and I thought that he would contribute more detailed information in response to questions. But then I suppose I realised that that is not what actually happens, and I formed my own ideas as to why.

Thank fully all of the information about property investing no matter what your strategy is, is all over the net, in books everywhere and in many cases completely free (I don’t disagree with paying for information though).

I have seen the information that Steve teaches repeated multiple times and in detail in many older sources of information. Likewise, with many of the other strategies. I’m sure you have as well.

As I am sure most would agree, the very existence of this forum is extremely valuable.

Cheers,

MarkyMark