I am new to this forum and look forward to interacting with everyone on this forum and learning as much about property investing In Australia.
A bit about myself…
I am currently living in Cape Town, South Africa. Over the past 5 years I have built my property portfolio at a decent rate and currently own 30 properties. I have been building my portfolio in my spare time as I am currently and IT professional with your normal 9-5 job. I have purchased these properties via agent agents as well as sourcing my property. My buying criteria has been simple.
1: Buying property Below Market Value (BMV)
2: Buying property with a positive cash flow
The reason for this is that I firmly believed that when you buy property for investments purposes, you should be making your money from day one in terms of the equity in the property and the positive cash flow it generates.
I would like to take the knowledge I have gained in South Africa and start applying it in Australia when I move over at the end of the year.
Some of the areas I’m looking for information on is there following:
Financing a property purchase (mortgage originators / % loans the banks are willing to give you)
Determining market value of a property (online valuation tools)
Sourcing your own property and receiving commission on deals (i.e do you need to have an estate agent license to deal in property?)
Costs associated with buying property in your personal vs trust( taxes / legal fees – mortgage registration and property transfer fees)
Perhaps it might be a better Idea if I create separate topics for each of the above?
Regards,
Robbie
Hi
You’ll find the rules are very different here. Most smart investors invest for capital growth, not cash flow, but you’ll get others on this forum disagreeing with that.
You need a real estate agents license here to get commissions on sourcing properties.
I think you need to be a resident here to buy established properties, non residents can only buy new or off the plan
Thanks for the reply Charles.
Depending on your investment strategy and you goals, from my personal experience its good to do a combination capital and cash flow deals. It would be silly just to limit yourself to ONLY capital deals of ONLY cash flow deals.
Although I am living in South Africa, I actually got my permanent residency for Australia last year. I'm planning on moving to Australia at the end of the year on a long term basis. With this in mind, does permanent residency allow my to buy any type of property in Australia?
With regards to my other questions, I'll create separate topics.
Regards,
RobbieHi guys,
Just wanted to let you know I'm back on the forum and looking forward to learning as much as I can about the property market in Australia.
I will be making a permanent move to Australia on the 19th March 2011. My plan it to find a decend IT job (as I'm an IT professional) and get settled, with the intention of building a small property portfolio in Australia.
With this in mind, I would like to get familier with the market, areas, etc. I intend to source my own property deals, so I am going to need the following:
1: Some sort of spreadsheet to evaluate a deal which takes into consideration your rental income, monthly/weekly bond repayments, property expenses etc etc. I currently have a spreadsheet I use to evaluate my South African deals, so I would be keen to see what you guys are using.
2: An Australian Offer to purchase. I currently have my own Offer to Purchase I use in South Africa, but this document obviousy wouldnt be applicable in Australia.
Look fordward to hearing from you guys.
Regards,
RobbieHi Robbie.
I am also ex-South African and have been here for 10 years.
The property market has gone through the roof here and it is pretty hard to find good deals.
For example, in my Melbourne suburb the median house price has gone from 450K in 2004 to 950K in 2010.
A house around the corner from me sold for 1.4m yesterday, a record for our suburb I would think.It is my experience that the yields on an average property are about 6-7% gross, but to be honest you can get that in a good Term Deposit here, with a lot less risk.
Capital gains seems to be pretty good, but the positive cash flow is questionable, especially given the high property prices.
Many Australians are now thinking of putting their money in the US markets where prices have fallen and rental returns are good. There is a section on this forum for overseas deals.Anyway, our main real estate site here is http://www.realestate.com.au. It's a very good site, and pretty comprehensive.
If there is a tenant, it will usually state the amount in the listing, so you can work out if the deal is worth your while. You can contact the relevant agent for information on council taxes and property management fees etc.I think the spreadsheet you use for you SA properties will cover the same things here. The only difference is factoring in the Stamp Duty payable on the sale price.
Buying a property here is also a mix of private sales and auctions. Auctions seem to be most popular in Melbourne and probably Sydney. I don't know about the other cities. At auction you come along to the property on the day and bid, so there is no Offer to Purchase. You sign the contract on the day and hand over a deposit.
If the property is a private sale, then you could make an offer, but to be honest, we seem to be a bit more casual about it. You could probably prepare something formal, but you could just as easily make a verbal offer or scribble something down and fax it to the agent. We bought our house that way, LOL.
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