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Hi Daryl,

Not a guru – nor am I a cashflow investor so some of my comments may not be in accordance with your goals.

To me any town of less than 30000 people is not a suitable place to invest. I would also suggest that 30000 is too small but that is another debate.

The reason I say this is that the long term fundamentals of a place need to be secure so that your investment money is secure. Quite frankly I see little value in placing any of my money into a high risk small town which has limited sustainability. In general terms once a small town always a small (and usually dieing) town given Australia’s overwhelming desire to centralise our populations and services.

For me – give me a city and let time do its bit.

Derek
[email protected]
http://www.pis.theinvestorsclub.com.au
0409 882 958
Skype – derekjones2113

I’m not too long in the investing tooth, so my opinions are only that. But…

We had a house in a city of 180,000. We bought it for ourselves, but when we moved out, it was positively geared. Right now it’d be neutrally geared at it’s current value (we sold it a few years ago).

I grew up in a town that 20 years ago had 4000-5000 people in it. It now has nearly 30,000 and is still growing. It’s also just down the road from a city of over 200,000. I don’t know if there is much “out of the box” CF+ property there now or not. I’ll have to go back and have a look.

I’ve also seen properties that would still pass the 11 second solution now in towns <2000 people. There ARE still some around.

On the other hand, there are citys of several 100,000’s in the USA at the moment that are shrinking and property prices are falling. Size is not the only important issue. Sustainability is important. Unless you’re only looking for a short or medium term investment, in which it only needs to be sustainable for the period of your investment and a bit longer for safety.

The real catch is to make up your mind about the long term viability of the town. Is there only one company supporting the whole town, or are there 3 major industries all moving in and expanding. If there are expansions – is it just a short term boom, or is likely to be a long term thing.

Then the other part of CF+ is to look at how to MAKE the pfofit, not how to BUY it. if a property is CF- as it is but you can clearly see a way to make it CF+, then it’s worth taking a long hard look at it. If it all stacks up, do the Nike and Just Do It. If the town looks sustainable, is expanding into other industries, has expanding infrastructure, has sustainably growing population, who cares if it’s 1500 people or 15 million. IF the numbers stack up and the town’s industry is sustainable, go for it.

Anyway, I’ll get off my soap box. After all, this is just my strongly worded opinion [blush2]

Good luck. See your goal and go for it.

Craig.

100% of the shots I don’t make don’t go in – Wayne Gretzky