Hi everyone, I’ve just purchased 3 properties in Katanning (WA), with great returns:
purchase price rent per week
$40,000 $85
$49,000 $100
$50,000 $120It took me a long time of research on the web to find this place, and now that I’ve chosen my properties, I wanted to share with you all the fruits of my research, as I think 3 properties is my limit in any one town! (does anyone have any comments on this? do you think there should be a limit to how many properties one should own in one place?)
The local real estate agent was very helpful (Elders Real Estate – http://www.elders.com.au/real estate). He agreed to my terms of $1,000 deposit (like Steve recommends in his book), and I also made the contract subject to tenancy, so that the properties are paying for themselves from day one. We were able to borrow 80% from Macquarie Bank (the hardest bit of the deal was finding a lender). You may be wondering why I’m giving away all this information – I’m in no way associated with any of the parties involved, I just wanted to share my good experience of investing in this town…..I would love to hear from anyone too who knows anything about Katanning.Rjk
thanks for the info, hopfully others will buy in that town and push prices up fro you
to answer how many PI in one town as many as you can get that you can sleep at night with is my view, the important thing is to be happy with the outlook of the town
GLenn“I should be content to look at a mountain for what it is and not as a comment on my life” D. Ignatow
Hi
from what I recall the population in Katanning has been steadily declining over time as businesses and industry (what i’m not too sure) moving elsewhere.
Later……….
If you think you can you can, if you think you can’t you can’t.
rjk,
Here’s an article which discusses manydemographic details of Katanning, including population, age distribution, industry/employment, education, … plus lots of stuff about the issues facing the town. It says that the trend of the leaving of youth from Katanning is second only to Broken Hill. for those interested, Katanning has a population of over 4000.
http://www.crlra.utas.edu.au/files/rolevet2/Katanning.PDF
rjk, if you check out the latest minutes from the last Katanning Council meeting, it has details of the negotiations about the abattoirs.
kay henry
Hi Glenn, it would be great if others bought in the town however if prices are pushed up the properties wouldn’t be positive cashflow would they?
Hi Hotrod and Henry, thanks very much for the info…I will definitely check out the website link and the council minutes.
rjk,
How many in one town? – that’s very individual and relates to the person’s risk level and amount of risk associated with the town. To date, I have only bought 1 house in any one suburb or town to spread my risk as different suburbs and towns do have different growth times, different risks etc. But like I said, everyone’s tolerance to risk is different so everyone’s answer to that question will be different.
Kaye, that was a great report on the town. Is it a regular repost you access town info from or a one off study someone had done on that area only?
Good Luck rjk
PKPK,
I just went to google.com.au and looked up “katanning” (australian sites only). The first site I looked at was the Council website, and then I looked at the minutes of the last meeting, which is where I saw about the abattoirs. Then I went to that article I provided the link for, and read it. As you can see, it’s a research report done by someone at the Uni of Tasmania, and the focus is on Katanning’s access to VET. But it had so much good info about everything, that I thought I’d post the link. Actually, I’ve found some VET reports and research papers to be very valuable, because many of them discuss the issues of small and rural communities, so they’re really comprehensive.
rjk, I don’t think there’s any *organic* reason not to buy multiple properties in one location- it would depend on the location. I would buy multiple places in the locations I have bought into- *if* I could pay the same prices I have paid- but no point living in the past :o)) It’s a matter of assessing “risk vs reward”, I guess, or doing a cost/benefit analysis or whatever. As I guess you’d have thought about, rjk, really small communities can have more risks sometimes than larger communities can, but if you think your properties are sustainable, then why not?
kay henry
Hi Kay,
Thanks for your thoughts…I bought a place in Devonport with 10% return before the prices went up, and I too wished I had have bought more..which is kind of why I ended up with 3 this time! Hopefully I’ll feel glad in the future that I bought the 3 instead of just 1.
They are pretty basic neat houses. What are people’s thoughts on doing some minor renovations on these properties?Hi RJK
I am in the process of getting renovations to my IP.
It comes down to $, if you can pick up the property cheap enough, why not.I picked up this IP for $25,000 my reno will cost me around $14,000 and rent will be $110 pw.
In this area similar properties were selling for around $60,000, rent $110 pw.
The real estate agent advised me that I would now get around $65,000 for my IP.
Good luck[biggrin]
I think it always pays to keep properties in good order the tenants always seem to take better care of better maintained properties. Remember too if its maintenance its tax deductable.
[email protected] Always have cashflow positive Tasmanian commercial properties
availableHi Rjk,
Katanning schools have been losing staff numbers steadily for a number of years now as the farming community absorbs neighbouring farms and one family leaves town.
Locals are rubbing their hands with glee at prices investors are paying for a piece Katanning property.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
Thanks for all the great comments, Marrissa – sounds like you’ve got a good strategy – do you live nearby your investments so you can supervise the renos, or do you do it all remotely?
Derek – I still think I got pretty good prices for mine, and hopefully there are still enough people around to keep renting my properties!! They are at the lower end of the market, which always have more renters available. Hopefully the export abbatoir there can get some good contracts and keep the town going.Great result Marissa [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 rjk
I dont live nearby, in fact I have only been to the house a couple of times.
Most of my contacts have been through the Council, agent and locals. Before jobs go ahead prices are faxed to me in Perth.
The carpenter come plumber has been coordinating most jobs and to date it seems to be working well.
[biggrin]If anyone managed to purchase an investment property in Katanning, I’m dealing with Carole Drayton from Joe Fanchi real estate in Wagin (50km from Katanning), who is proving to be a very good property manager….I found it a little hard to find someone, which I guess is one of the challenges of investing in a regional town and also not being there in person to suss things out. In hindsight, I probably would have started the property manager search a little sooner, just to ensure there is someone professional around who will be able to look after my investment. I guess it’s no good investing somewhere only to find your place won’t be properly looked after. My personal opinion is that a good property manager is worth their weight in gold.
Hi rjk,
Congrats on your IPs. I hope they work well and hard for you.
Well done on making a decision and gaining the experience in rural IP management. Keep us informed on your progress.
I too am looking North, follow the gas pipe line. Port Hedland also interests me as they are wanting to relocate the whole town!!!!! How cool is that.
We recently sold our 2nd IP that was compromising our investment portfolio and hence, we are now able to postion ourselves into more CF+ IPs. Maybe in the rural?
Cheers
BrianBC Tucker
Hi Brian,
Thanks for your positive words. It can be pretty scary at times, but once you jump in, you usually find the water is warm, eh? What do you mean they are relocating the whole town? Do you mean Port Headland? I will have to do some research out of interest and find out a bit more. We too are revising our portfolio as Steve McKnight suggested and have put our Sydney unit on the market as there’s not much capital appreciation foreseeable and we have to make up alot of the mortgage payment from salary even after rent collected. We will do more +CF props too once we sell.Hi again,
Yeh, Port Headland lies between the ocean port and the BHP refinery and lots of reports of potential environmental pullution for the town folk. Its only in the discussion phase but watch that space.Cheers Brian
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FYI BHP Billiton has just rejected the “relocation of all Port Hedland” to a location is South hedland! I was at the local Town meeting, so if that is why you are investing in the Town – here’s a heads up!Cheers
C@34
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