- Originally posted by wealth4life.com:
[– nett worth over 5 mill – more than 5 properties –
Well wealth … finally fixed the abacus for the fifth time, (those cheap south east asian sweat shop strings arn’t worth a damm) and whipped off the shoes and soxs, …… and the results are…..close, …..maybe if I hadn’t wasted so much on abacus strings….
Now how do you want to define close……
Funny GMH … you can make up the difference by getting a Virgin and Aussie low interest creditcard and loading them up with debt.
Or
Use Henry Kayes formula of buying 1 million of property with a million debt, but u r still a millionaire, go figure.
Or
Adopt the principles of Steve and buy 260 properties positive cash flow in 7 years.
I think given the choice that number 3 looks like the best bet, sort of makes me feel bad that we only have less than xx – must be doing something wrong.
D
Just a quick thank you to all the people who have responded or read this thread …
It is obvious there is great concern out there currently especially when the rates rise even further, however thanks again for responding to this very successful post …
LOL
D
If anyone interested, market value change in Brisbane / Manly townhouse prises.
This is based on recent evaluation of our PPOR:
2003 – 220K
2004 – 290K
2005 – 280K
2006 – 260K
Current rental return is about 280 a week.Makes you think….
The Great Divide is a sad fact, but no one says it has to be the only way. It is so unsexy to tell the truth like it is, minus the sensationalism (media the culprit in particular).
Until the politicians and educators see it crucial to teach Personal Finance at school level to aid understanding of building wealth locally in oneself, it is not possible to see clearly the big picture – living in an economy sustainable for growth and prosperity. The Great Divide is just a Zero Sum Gain – we all lose as we’ll pay for decision we did not make – the interest rate.
If we are educated that overnight success is not attainable, there will be less of a boon for illegitimate gurus to expound “secret to success” through seminars. The fundamentals are taught and thus empower all individuals to make sound decision for themselves. How many times we distrust professionals lacking fiduciary duty of care? Their integrity is glaringly obvious to trained eyes; usually they are the people who have genuine interests in helping others to succeed (building their business around that is sustainable).
I’d like to see my children intelligent enough not be taken in by greed perpetuated by misplaced interests of the professionals (credit providers, financial planners, property gurus, managed funds etc. etc.). Now before anyone jump in – Maybe I’m not sophisticated enough to reap the reward on other’s misfortunes, then so be it.
CT
Hi CT yes it is unsexy to tell it like it is … because people are ashamed to hear it.
The sad fact is bar the few 3% who will succeed the remaining 97% are falling further behind into debt and a life of misery… just watch ACA tonight and you will see why,
Dah this guy is dumb, hello credit cards and store accounts plus car leases won’t get you rich!!!! ah actually it might even get you futher away from it … and who does he blame … oh i got it in the mail so i thought ah oh why not i deserve it … you sure do sonny …
I know lets go get a 106% home loan i know lots of brokers who push that product (just to get a fat commission)
D
IMHO a lot of people do not care/think about the long term result of action taken.
Most of them never even realize than money can be made by simply working hard and allocating funds to what needed rather to what’s wanted.
But the blame game start once people loose the grip and thinks go out of control.
It is always the same everywhere; you got to sit down with a pencil do some simple mathematics before you committed your self to significant expense. Just got to do the homework, same as at schoolAside of this small story about one salesmen who showed up at our doorsteps 12 moths back. He was offering us houses as IP to purchase and his company will provide rental guaranty for 3 years. Based on his words you can afford 10-15 IP without investing much money and relying on tax return and rental income. Sounded fascinating! I asked him to do some calculations showing how the funds flow including ongoing expenses of maintaining IP’s. Guess what? He could not put the figures together and he cannot do simple calculation of interest using calculator!!!! LOL. I could not believe it, he was trying to sell us 300K+ IP’s located in LOGAN
All you need is just to listen to those guys/advisers and do some simple calculations to see what it is all about
[biggrin]Originally posted by wealth4life.com:I know lets go get a 106% home loan i know lots of brokers who push that product (just to get a fat commission)
Do these products generally come with a trailing commission that lasts for as long as the balance is negative? I’d reckon it would be hard to refinance, so that would add to the attractiveness from the broker’s point of view.
Oh, and CPI figures just released – 3.9% yoy. Another interest rate rise in 2 weeks is guaranteed.
Cheers, F.[cowboy2]
Two pieces yesterday struck my attention.
First was by the ?????? Institute, which said home loan affordabilty has hit a three year low and is now comparable with the good old days of 17%. …oh the memories ( I hit 19% myself)
Other was from the REI that said if parents could sell their grandchildren into indentured service on the futures market then these new home buyers may finally be able to afford to get into the property market, and that the Government should set up the appropriate futures market ASAP, ……… sorry just re read it, it was that should be allowed to use their super.
That makes sense…super worth 25K, goes towards house, all developers raise their price 25K tomorrow…. well it worked with the first home owners grant…
Can’t blame them for trying
Ahhh what did they say, Lies, Dammed Lies, Statistics and the REI
Wright again GMH, did you watch the news last night,
The look on Peter Costellos face now that there will be another interest rate rise the only thing he could say was “its good news that petrol prices have come down and the average Australian will benefit enormously …
So is he saying “well interest rates are up but that will be offset from cheaper petrol prices”
I just want to scream !!!!! – oh well we’re in good hands??
D
What do you think will happen to first home buyers if IR goes up again?
The theory is it will make it even harder for first time buyers. It does make sense. But do you think the IR increase will push the prices down to even it out? Now media even talking about double IR increase, next month and early next year.
I don’t know if it will have a lot of impact in WA though.Wealth4Life, I don’t watch commercial TV channels for that reason. I do listen to the wireless, no point for guessing which one …
The sad thing is the Blame Game continues even at the political level. Costello’s points-scoring on Howard’s government diddling the public on his electoral promise on interest rates remain low during his term – He knows the economy is not under Howard’s spell, but spin he will to the public.
Geez, I can see Keating chuckles and quoting his famous line again ….. History repeats itself, but this time it will hurt more than last. Costly lessons indeed for those who failed to notice.
CT
Dear CT & CL well here are my views before we go to the country for 3 days with the kids to buy some more property.
My research shows that people are really hurting, especially young families and first timers. One of the suggestions we give to people when starting out is not to buy a house but to start small and get a unit or second hand town house. The reason for this is that too many people when they get a house spend thousands to impress their family and friends with, pools, bbq areas, plasma tv etc etc. (on credit) Plus its hard work to keep your home maintained to the highest standards to maintain its value.
I read reports all the time from gurus trying to say that we are at the bottom, well i don’t think we are and i believe that there is more hurt round the corner, i could write a book on the reasons why, but lets see if i am wrong.
The bargins are in offering people stupid amounts of money for properties that people need to get out of because of financial difficulty. A friend of mine bought a second hand property in a great area of Cambeltown in Sydney on 750 m/2 – 4 car garage – 4 bedder the asking price was 380k and was a divorsed sale they got it for 265k with nothing to spend and are renting it for 415 p/wk.
Some ones bad luck is some one elses good luck, sad for some happy for others but thats business – its no different to buying businesses you have to negotiate hard to win.
I still believe today that the one underlying problem is financial intelligence, like 2+2 = 4 its easy to spend the stuff but harder to save, poor people have bad credit rich people have credit. In general when interviewing people i find that peoples problems today are a result of poor planning yesterday.
The second biggest problem is that 95% of people don’t want to change their mind set because they feel that they are reducing their standard of living, well this is going to happen naturally the way they are going any way but they just can’t see it.
I believe we are entering a buyers market, properties on the outer suburbs of most cbds will be snapped up for bargins and an 8% + return on residential will not be unreasonable, actually we don’t buy now unless we can get that as a miminum – make the offer, leave a business card then walk away.
The gurus now are running seminars on how to borrow to buy property i thing you should be going to seminars on how to research and buy bargins. Financing is easy when the deal stacks up to the bank.
Just in closing let me prove how stupid people are with money … xmas is just around the corner and we know people are hurting … my preditiction is that this year we will set a new credit card record – after all its been a hard year and we need to treat ourselves – it won’t be long before we hit 40 billion dollars in CC debt.
Bad times ahead ahead YES – bargins to be had YES – good luck … oh have you seen http://www.thesecret.com
D
Dear CT & CL well here are my views before we go to the country for 3 days with the kids to buy some more property.
My research shows that people are really hurting, especially young families and first timers. One of the suggestions we give to people when starting out is not to buy a house but to start small and get a unit or second hand town house. The reason for this is that too many people when they get a house spend thousands to impress their family and friends with, pools, bbq areas, plasma tv etc etc. (on credit) Plus its hard work to keep your home maintained to the highest standards to maintain its value.
I read reports all the time from gurus trying to say that we are at the bottom, well i don’t think we are and i believe that there is more hurt round the corner, i could write a book on the reasons why, but lets see if i am wrong.
The bargins are in offering people stupid amounts of money for properties that people need to get out of because of financial difficulty. A friend of mine bought a second hand property in a great area of Cambeltown in Sydney on 750 m/2 – 4 car garage – 4 bedder the asking price was 380k and was a divorsed sale they got it for 265k with nothing to spend and are renting it for 415 p/wk.
Some ones bad luck is some one elses good luck, sad for some happy for others but thats business – its no different to buying businesses you have to negotiate hard to win.
I still believe today that the one underlying problem is financial intelligence, like 2+2 = 4 its easy to spend the stuff but harder to save, poor people have bad credit rich people have credit. In general when interviewing people i find that peoples problems today are a result of poor planning yesterday.
The second biggest problem is that 95% of people don’t want to change their mind set because they feel that they are reducing their standard of living, well this is going to happen naturally the way they are going any way but they just can’t see it.
I believe we are entering a buyers market, properties on the outer suburbs of most cbds will be snapped up for bargins and an 8% + return on residential will not be unreasonable, actually we don’t buy now unless we can get that as a miminum – make the offer, leave a business card then walk away.
The gurus now are running seminars on how to borrow to buy property i thing you should be going to seminars on how to research and buy bargins. Financing is easy when the deal stacks up to the bank.
Just in closing let me prove how stupid people are with money … xmas is just around the corner and we know people are hurting … my preditiction is that this year we will set a new credit card record – after all its been a hard year and we need to treat ourselves – it won’t be long before we hit 40 billion dollars in CC debt.
Bad times ahead ahead YES – bargins to be had YES – good luck … oh have you seen http://www.thesecret.com
D
Originally posted by zen1:
[brI don’t know if it will have a lot of impact in WA though.If it doesn’t then they will just keep coming.
“After all, this whole mess is just the fault if those greedy arragont @#$$% in WA”
“Good idea John, but maybe we should leave out the #$%%^ next Wendnsday….how about a new tie..the pink will go nicely
If it doesn’t then they will just keep coming.Does WA has that much impact on the RBA decision to increase IR? The property market in WA has gone silly but the inflation figure does not include property prices.
The RBA looks at the over all picture and not necessary one particular area.
We just came back from visiting 9 country towns in NSW out to Cowra, i don’t know but with the water crisis and jobs its pretty scarey looking to invest in those areas.
I feel better investing near CBDs in major areas … the next interest rate rise will concern a lot of highly geared people.
D
Perth info:
After reading this post, there seems to be some confusion about “why” Perth is still booming.
All of these facts can be confirmed:
* Currently the lowest unemployment in Australia. In fact, the lowest unemployment EVER recorded in any city of Australia.
* Second highest (highest now?) average wage in Australia.
* The houses in WA are generally larger, on larger blocks of land. Compare inner city Perth to inner city Melb or Sydney, the houses and land in Perth (especially the land) are larger. Comparisons are apples v oranges.
* Wages are now high across the board – situations such as recent accounting grads are now getting paid 100k, not just the “laborers and miners” you read about.
* Perth is the second fastest growing city in Australia (after Brisbane). This is a long term trend. Currently 100 people a day (approximately). This is a large number for a city of only 1.5 million.
* The commodities market will of course cycle, but – the world will need more resources in the next few decades than it has ever needed. WA has A LOT of resources, and can meet demand.
There is so much misconception about Perth from the “rest” of Australia. My opinion is that if people REALLY new what Perth was like, prices would be even higher.
On another popular property forum, I stated that the Perth median would EASILY crack 400k this year (I stated that about 18 months ago). There was utter disbelief. Well, we know how that one turned out.
Perth will EASILY become the highest median price in Australia, surpassing Sydney, I would expect within 6-12 months. Do the numbers – it won’t take much of a fall in Sydney, nor much of a rise in Perth for this to happen.
I own in Melb, Sydney, and Perth. My next purchase will be in Perth, based on CG alone. I have lived in all three cities – all are magnificent, but Perth hits the sweet spot in so many regards.
For example, I have just made an offer on a 850sqm block with house less than 6kms (about 10 minutes peak hour drive) from the CBD, less than 1 km from the Swan River, that is zoned triplex. Price – $380k.
126k for a block of land in a state that is booming with high wages, low unemployment, and great weather???
THAT is a bargain.
Now back to lurking.
Oh had been wondering why ……. this time … Perth is different.
And what has been driving the economy. Mining, not yet, WA still has a infrastructure lock that has yet to be addressed. Quote ABC mid day news last month
What has been driving your economy is the building. People are coming into to your building industry, and for each one who comes in to work, they create the need for more accomadation. The cycle just keeps going.(again ABC midday news)
Yes Perth might pass Sydney as higher median price, but from figure available Perth average incomes have still a way to go. And finally what rental return are Perth investors getting, and based on that are the people still buying investors or speculators.
Now on that I have no hard figures only snap shots here and there, so maybe you can help ???
Oh had been wondering why ……. this time … Perth is different.
And what has been driving the economy. Mining, not yet, WA still has a infrastructure lock that has yet to be addressed. Quote ABC mid day news last month
What has been driving your economy is the building. People are coming into to your building industry, and for each one who comes in to work, they create the need for more accomadation. The cycle just keeps going.(again ABC midday news)
Yes Perth might pass Sydney as higher median price, but from figure available Perth average incomes have still a way to go. And finally what rental return are Perth investors getting, and based on that are the people still buying investors or speculators.
Now on that I have no hard figures only snap shots here and there, so maybe you can help ???
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