Dear all
I want to thank everyone for the great welcome and worldly information I have received since signing up to this forum (thanks to adam and mortgage hunter especially). After reading Steve’s great book I have become very inspired to set myself financially free as many others on this site.
However, I find that there are a few hang-ups when attempting to put the theory into practice. Firstly, property prices are no longer around the $100,000 mark (or at least I cannot find them on realestate.com.au). Secondly, soon after you increase the price of the purchase e.g. $100,000 to $150,000 due to higher loan repayments the margin between rent income and property repayments become much smaller. Thirdly, there are a lot of costs that come into consideration, for example, body corporate, insurance and council rates just to name a few.
Therefore, if we consider Brisbane housing prices, these three issues make it impossible to start producing positive cashflow because the opportunities simply don’t exist (assuming that you attempt to make a minimum of $50p.w. of passive income). Please share your thoughts on this as I find that even if you decide to go outskirts and buy property for a cheaper price will still limit weekly rental income because you cannot charge the $200-$300p.w. that you would charge in the city).
Please keep in mind I am using the brisbane market as an example because I am most familiar with its characteristics and movements.
Look forward to hearing your thoughts and criticisms.
Cheers
Tig3rHi again Tig3r,
No probs with the assistance mate – it’s what this forum’s here for, and I have certainly got my “pound of flesh” from it myself, so it’s only fair that I put a bit back in! But thanks very much for your appreciation[biggrin]
Regarding your question, as I suggested in my post (see link https://www.propertyinvesting.com/forum/topic.asp?TOPIC_ID=22508) you need to narrow your search down to a particular area first. And as you’ve discovered, Brisbane is probably not the easiest place to concentrate on when you’re just starting out! We have gone through a huge boom here, and prices have far outstripped rent returns, so you (and I) will struggle to find CF+ deals within the city.
Go further out. Start looking around regional centres. Begin by doing an online search for properties less than $150K in SE Qld. This may give you an area to start searching within. It won’t help you very much, because there will be lots of “hits”, but it will at least show you where NOT to be looking (eg. Brisbane!).
Unfortunately this is the question a lot of people have when they’ve just finished Steve’s books, because they think “okay – I understand the 11 second solution, now I just need to do a search and there they’ll be”. But these days it’s just not that easy. Since the first book, the whole country has gone through the biggest boom in our history, and in a lot of areas rental yields have just been wiped out by the massive upsurge in prices. It will take a long term for rentals to catch up with this CG.
So in response to this, Steve tried to help us in his second book by giving us the equation “problem + solution = profit”. By this he meant that in the current climate, CF+ deals just don’t grow on trees. You will almost certainly not find any online (except perhaps in tiny places in the middle of nowhere, but then the risk of long vacancies and the costs of upkeep and the simple fact that you are so far removed from your investment makes these deals a no go). The best answer is, as I suggested in my post, to get out and pound the pavement and actively look for them. Have a read of my post for possible methods of doing this.
Well I hope that helps you Tig3r. It’s easy to get disillusioned in the current climate. I can only try to reassure you by saying that the deals ARE still out there, you just have to work harder for them! In fact – this is a great opportunity for those of us who have the guts and determination to persist, because everyone else will have given up! All the more for us!
Cheers,
Adam
Oasis Finance
for your Vendor Finance solutions
Achieve the Dream!
[email protected]Hi there
You just answered all of my questions and addressed my growing despair Thanks so much. So it is still possible hey? I’ll keep looking, unfortunately / fortunately I’m used to hard work! Does anything ever come up in Brisvegas do you think?
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