I have been trying to find positively geared properties, spending hours on the internet, reading various property magazines and any other media I can get my hands on, and have yet to find 1 property that meets the 11 second rule. Perhaps I am doing something wrong! I didn’t think it would be easy finding properties but I didn’t think it would be this hard either. Can anybody help?
Your probably not going to like this answer but I suggest you get Steve McKnight’s 2nd book.
These days +CF properties are made not bought (though you can still pick +CF properties up, but as you said it’s very hard to find and usually the areas aren’t great).
Learning how to create CF+ will probably also increase your returns as well as you know how to increase your invesment performance.
I have read Steve’s 2nd book, and I do know I need to increase the value of the property.
I have read many Q’s and A’s over time on these forums similar to mine and no-one ever gives a straight answer. I can read books until the cows come home but that’s not going to make me money!!! Perhaps this concept doesn’t exist any more.
You’re right I didn’t like your answer, because you didn’t give me one!
If you want a yes or no the answer is no there are none.
Not at least for the inexperienced or short on dough type investor.
You need to put money in to make them this way.
There are some CF+ properties around in regional areas but they will be in flood prone areas etc or have problems which need to be overcome and this is not at all easy.
On the net and in books you will of course get a lot of wrong/dicey/unethical info at best, maybe even illegal, you need to be careful what you act on.The fact that cash flow positive property can only be found in a mining town or some dump in the sticks with a falling population simply means that property is overvalued. You just have to either wait years for fundamentals to catch up, like in the early nineties, or hope for a crash.
Just sit back and watch the show. Start buying when Sydney CBD starts to take off, in about 5 years.
Good luck.
Hi EllyH,
Bloody frustrating isn’t it.
Don’t lose hope or ethusiasm, your property is likely to come out of nowhere.We all have been there and yes there is properties out there.NO not in flood areas, and not strictly to “11 second rule.” eg, My thoughts are “11 second rule ” is a guide only , the difference between property purchase price will vary . Rates will stay same , management fees will vary–and so it goes !
We have bought in towns of around 10000 people and have for instance;
1]Block of flats 187K, income $19968($264/wk)rates 2000/yr
2 3]Set 4 strata units 225K,income $23400($450)rates etc 5816/yr.
2]Block of flats 120K, income $17160($330/wk)rates 1200/yrAs you can see 1st xample not starting at 11 sec rule requirement (12 mths earlier but is now) but still gave us positive income because of deposit amount and slight increase in rent due to “furniture addition etc”
Xample 2 is perfect “11 second rule” but not very cashflow positive.
Xample 3 is beautiful all round–and settled only 2 months ago.
Keep looking mate and I have not “prettied the picture” for you.
But “11 second rule” is wrongly named I feel. do not get bogged down with it.
My quick overview is to multiply the puchae price by 1.3 and add $25 to that amount (for rates) and that was my determination to proceed further or not.
EG: $100,000 pp * 1.3 +25 = 155.
Rent needs to be 175 to provide 20/wk nett to us.
I realise we may have to take into account pm fees but also consider that the purchase price is negotiable and the whole exercise is an “on the spot” calculation for follow-up or not.
Don’t lose hope.
Don’t place too much concern on “11 seconds”
Good Luck.
Cheers for now LenHi EllyH
I can’t help but wonder whether you are not finding the properties because you are only seeing what you want to see.
Hellman DID help. He told you to read Steve McKnight’s 2nd book and learn how to make properties CF+. They are still out there (sorry to disagree with you bob the worker and, to an extent, markpatrick). I have bought 4 in the last 18 months and they are all returning at least 10%. I have had the opportunity to buy plenty more but I didn’t because I use proper risk management and don’t just buy because the property meets the 11 second rule.
Yes you can read books until the cows come home but it doesn’t sound like you have read Steve’s book properly. Generally speaking, the 11 second rule is not the place to start. You need to look for properties that, with a bit of work, will meet the 11 second rule.
Will I tell you where I find my properties? No. That’s partly because 18 months ago when I started out I had to do it the hard way and learned #$%@loads in the process (the old teach a man to fish principle). Secondly, just telling you where I get them won’t mean that you will get them. I have worked long and hard to build up contacts in the areas that I buy and I have access to properties that the general public doesn’t have.
I have previously put a post on the forum about where to start. It is under the heading “Positive CF Property – are they out there?”
Good luck. If you are serious about property investing you have a lot of hard work ahead, but you will reap the benefits.
Cheers
K
If it was too easy everybody would be doing it !!
But like markpartick said they are not always visible to the inexperienced or those that do not already have some financial backing to make it happen at the drop of a hat.In the past month or so I have found a couple of properties that were cash flow positive. The first like you say is in a country area, there is no real estate agent in the area to manage it etc. But I think I know a way that I can make it happen, because I’m starting to think outside the square.
The second was a place worth 1.1M with a weekly income of around $2500. The bulk of the income was deposited directly into the vendors account by the government. Meet the 11 second rule no worries. Rates were about 2K pa. no BC fees. It sat there on the internet (Realestate.com.au), for all to see. It was located within 20km of an international airport. The area has had 50+% growth in the last 2 years, and still there is a deal like this.
Not everyone could go it alone on an investment like that. But somebody obviously had the funds or the know how, to put the deal together quick smart.
I knew about the property before it hit realestate.com.au, but my inexperience stopped me from getting a piece of the pie. Even though I was in no position to do it myself, I bet if I’d simply offered to birddog it so someone on this forum, I would have been getting Personal Mails left, right and centre.And, no it no longer appears on the recently sold list for the web site.
There is no substitute for experience, you have to get out there and do it.
Mal
Getting out of your comfort zone, can help you become comfortable
You must be logged in to reply to this topic. If you don't have an account, you can register here.
