Hi all! Newbie here, so I apologise in advance if this is a dumb question. I was looking at lease options because I believe it is very possible to structure deals with no cash down. From what I understand, a wrap is similar to a lease option, except that you buy it right at the start, not when your buyer chooses to exercise his option.
Reason I’m asking is because I am flat broke! I’m 24, living from paycheck to paycheck & have 2 younger siblings to support! I have about $3k in savings, nothing else. Do you think I should start off by doing lease options to generate a bit more upfront cash? Thanx!I would suggest you firstly buy a very cheap property and hold it in your own name. In todays market you will make quick capital growth, which you can then play with later. You need flexibility and assets to effectively wrap property. Initially 10% of purchase price, but you do get some of this back. You need to qualify for a loan initially, and stupidly it is harder to get finance for wrapping then anything else! Wrapping is also not super straight forward, and things do go wrong. You need to have some financial muscle (not a lot) in order to effectively deal with any issues that arise. Have a look in Tasmania, or country areas for 30-50k properties with very good rental return, I think this will be your best bet – until you have runs on the board, so to speak! Another point is that when looked at as a business, wrapping generates pretty poor returns. It is safe, but very capital intensive. Possibly a cheap business (<5k) would suit your circumstances better.
Hi,
This may not be the advice you are after at this point, but I feel compelled to say that I wouldn’t[/b[ be investing in property (or anything else) until you first addressed the issue of why you are broke in the first place.
No amount of money will be able to solve a money problem if you alwys spend 101%+ of what you earn.
Investing has much to do with discipline, which is the theme of my web site at http://www.wealthtipsonline.com.au note the Inner Circle is no longer available to new members.
Regards,
Steve McKnight
Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Thanx for the replies. No I don’t spend 101% of what I make; I spend about 99%! I am disciplined in a way- I REFUSE to pay interest on my credit cards, so I make sure I pay them off each month. I make just enough to get by in a job that does not offer sick pay/annual leave etc, hence I realise it’s not a way I can get anywhere. Hence the interest in alternative paths. [
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