Hi Everyone,
How many of the people in the forum use wrapping as there prefered choice for investing? if so what are the reasons you chose to wrap and also how many properties have you wrapped and also plan to wrap??
Matt Hooper[biggrin]
i’ve done 6 – 3 lease options and 3 installment contracts.
I wouldn’t do anymore. I have foudn the profit is too small for the hassle. It ties up your funds, and so you must take into account the opportunity costs.
Terryw
Discover Home Loans
Parramatta
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Yeh i have done one or two also.
And i still intend to do but maybe on a smaller scale now i operate on my own.
Richard Taylor
Residential & Commercial Finance Broker
Ph: 07 3720 1888
[email protected]Richard Taylor | Australia's leading private lender
Originally posted by Terryw:I wouldn’t do anymore. I have foudn the profit is too small for the hassle. It ties up your funds, and so you must take into account the opportunity costs.
Terry
So how are you investing in property instead?Cheers
PyramidNothing beats buy and hold
Terryw
Discover Home Loans
Parramatta
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Matt,
I have been doing wrapping for about 5 years now full time and during that time I have done a significant number of property transactions. I have done most of the vendor finance techniques during that time.
What have I learnt during this time … wrapping was a starting point in my wealth plan and as time has passed you learn a hell of alot and experienced a hell of alot as well. As a result you transform from a poor earning student to a well paid professional / business owner.
INITIALLY … When I started my monthly cashflow / profit share was $140 per month per property with the potential backend profit of $10,000 – $12,000 with significant acquisition, holding costs and management headaches.
NOW … My monthly cashflow is now $450 per month per property with the potential backend profit of $20,000 – $30,000 with low acquisition and stress free property management.
As time progresses in gets easier and easier with you doing more and more.
You must commit time and be willing to work hard to build it. It has not been easy along the way, however it is well worth it in the end.
Sorry if this does not answer your question directly … I just wanted to encourage you to get started.
Regards,
The Property Trader
Property Trader | Boston West Pty Ltd
http://bostonwest.com.au
Email Me | Phone MePrivate money lending opportunities available paying upto 12%, secured by bricks and mortar!
Matt
I have been invocled in Vendor Finance in Qld since 1996 and as a company we have done over 180+ wraps during this period.
One of the Companies I own First Home Owners Group Pty Ltd still holds 154 properties throughout Qld and the monthly cash flow enabled me to retire at 39.
Whilst retirement is not all it is cracked up to be it does give you choice and now i am able to help my client along the weath path.
Terry is right that in many cases had we bought and held the properties we would done a lot better by the way of capital growth however our Bankers certainly would not have funded that many properties through rental income alone.
To me i think you should look for a balance between the 2 strategies and decide whether property and indeed wrapping is to be business or an investment for you.
Richard Taylor
Residential & Commercial Finance Broker
Ph: 07 3720 1888
[email protected]Richard Taylor | Australia's leading private lender
Thanks everyone for that.
Ive been reading alot about wraps etc and I think its prob the best way to get kick started in investing in property at the moment.
And then later also go into buy and hold but what i like about wraps is that it will give you passive income rather than waiting for property prices to go up and you get to help people at the same time buy there home who cant do it through the banks.
So i think this will be my choice of investing to start with and then look at other opportunities when my cashflow is alot higher.
Cheers
Matt Hooper[suave]
Personally i dont know too much about wraps but i feel that they are risky. I prefer to buy and hold myself, so for me i havent done one yet but wouldnt say i will NEVER do one.
“It’s not how much money you make, It’s how you spend it that matters.”
Aspiring property developer
Giulio Taranto
Hi Matt,
Good question! And brought out some good responses too.
We are just starting out with L/Os. Haven’t completed any deals yet, but hopeful in the next month!
I think the biggest thing going against Wraps is the bad press they get. This was one of the deciding factors for us to get into L/Os rather than wraps – they’re actually very similar strategies, but you’re not stuck with the stigma of wraps.
Without having any actual practical experience, just from our research so far I think that the only real risk is in how far you go in qualifying the client and the property. If you do your due diligence in qualifying, then what risk is there? Make sure the client is stable and isn’t going to walk out on you leaving you with a vacant property, and make sure the property is resellable or re-rentable in case this does happen regardless. That way, the worst case scenario isn’t so scary.
The biggest hurdle we’re facing at the moment is getting the applicants through the door. I would be most interested to hear what others’ experiences are with this, and how they went about getting their prospects ie. what advertising they used. We have focussed on regional newspaper and realestate website advertising. It is working, but only at a trickle rather than the hoped-for flood! Any comments / suggestions / experiences anyone?
In fact, I might copy and paste this last bit into another post!
Best of luck with your endeavours Matt!
Regards,
Adam
Don’t let life get in the way of living.
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