Hello everybody,
I am very new to the site and books of Steve McKnight. I am a single worman approaching 50, just sold my investment property with no profit so no deposit to start again (got caught with high fixed interest and not enough rent to cover it). I work and do not pay rent as I live with family. Is there hope fo me? I have just finished the book $1000000 of property in 1 year and dont understand one part of the model suggested i.e. the problem – what is a problem? ( I am a great problem solver, however I dont normally go looking for them). I say again is there hope for me?
Cheers
WenderThere is hope. Since you don't need to pay rent you should be able to save up fairly quick and get into a new property
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Also keep a copy of the recent sales contract, settlement letter etc as you can still get 95% lvr on an IP loan.
Just QBE / LMI will query why the lack of assets so showing them the settlement letter etc will go in your favour.
As Terry mentioned 5% plus costs is not surmountable.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Thank you Terryw and Richard It wont take me long to save up I know. Richard you have used some acroyms I am not familiar with please elaborate
Cheerswender wrote:Thank you Terryw and Richard It wont take me long to save up I know. Richard you have used some acroyms I am not familiar with please elaborate
CheersWDYU? (what don't you understand?)
QBE is an insurance company
LVR = loan to value ratio
LMI = lenders mortgage insuranceTerryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Terryw you're funny – QBE I knew, LVR sort of, and LMI I did know. I have asked a couple of banks and credit unions and not one of them has asked for assets! They all just want a deposit (buggar) I do, however have the settlement letter and sales contract in case (but I dont think so). You have helped.
What sort of problems should I look out for in a potential IP? ( I have my eye on one which will return a net of around $10 – 20 per week with nothing to do) is that too small?
Cheers
WenderHi
Here is another acronym… SMSF (self managed super fund). You can open your own super fund, transfer your existing super into it, and use it to buy property
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Well I dont have much but that just might work!
Hi Wender,
And just another 4c worth – at the moment it is important to be in the market in my opinion – so really what I am saying is don't aim too high – if you buy right, and don't rush in just for the sake of it, it is better to buy a $150,000 house somewhere that that has some steady growth potential and does not cost you much to hold, that to try and save a deposit for a much more expensive place, and not ever be able to achieve it. It's all relative. Also, if you are not overly concerned about what state it is in, all states have varying amounts of stmap duty on the purchase price that the govt extorts (bless their little souls) so you may find that is less you have to save up for costs.
All the best – you'll be fine!Cheers
Hi Wender,
There are free seminars on this; http://moneytree.com.au/view/seminar-property-through-super?seminarId=1
I'd suggest speaking to a bunch of providers that have knowledge in this area, as well as people who have done this with their super, before committing to anything. Also have a chat to a couple of banks about how they lend to SMSFs for property investment.
Where are you located, by the way?
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Thanks JacM,
Good info, I will certainly do the ground work. I have found a bank that will lend to me without touching my super. I agree with you that now is a really good time to be in the market. Its easier to get another loan if you have already one, much like getting another job is easier because you've already got one! I live in Qld but am looking at North West NSW or will even look at property in Tas. Does it matter where I live?No it doesn't matter where you live. However keep in mind that if you live far away from your IP, you will be very reliant on your property manager. For instance if something breaks, you may not be able to justify an interstate trip to take a look yourself and decide on the best resolution. Could end up costing you a wee bit more. However, far better to be in the NSW market than no NSW market at all ! Choose your property manager wisely – do your ground work and get some recommendations.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Oops sorry v8ghia I agree with you about being in the market now. Do we still apply the 11 second "rule" in this climate? I have found a property selling for $130,000 (this doesn't take into account purchasing fees) with rental return $185 p/w. By my reckoning this will cover the loan repayment but maybe not the associated ongoing fees like rates etc. In this regard it will be slightly negatively geared – is this the sort of thing I need to look for? Or something even cheaper to purchase?
Hi Wender
I don't think you should jump into anything. It wouldn't hurt spending some time doing more research, reading and learning. Once you've worked out which strategy will suit you best you can then spend some time locating the area you want to invest in.
The more knowledge you have the better choices you'll make.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Due to other costs like insurance, rates (council and water – depending on how that is structured in your region) etc, I would be looking for something less than $120 000 if it was receiving $185 a week but that is just my take on it. I always aim to pay the bills and have something left to put toward either extra repayments or another deposit. Sometimes that bit left may only be $10 but I feel it is better than having to go to work to earn the extra $10. Plus in the longer term I aim to add value to the property by minor (generally) improvements and increase that $10 surplus!
But everyone has to decide on their criteria for themselves so as long as you are happy with the decision
Ruth
wender wrote:Thanks JacM,
Good info, I will certainly do the ground work. I have found a bank that will lend to me without touching my super. I agree with you that now is a really good time to be in the market. Its easier to get another loan if you have already one, much like getting another job is easier because you've already got one! I live in Qld but am looking at North West NSW or will even look at property in Tas. Does it matter where I live?Hi, I live in north west NSW and have recently bought an IP in TAS . Main sting in interstate IPs seems to be that stamp duty is different % in diff states and land tax rules are all over the place. What a waste of money they both are! Unfortunately stamp duty effectively increases your purchase cost and land tax eats into your annual profit if you are positively geared. ( I'm sure you knew that but an occasional vent is therapeutic! )
House call-Glad you got that out!! There is so much to learn and I love it. I am so excited to be able to be in charge of my future and not have to be a slave to the 9 to 5 (or in my case 6.30 am to 11.30 pm) ethos. Stamp duty- what can you do- the government has to have their share, no use worrying about it, just look for bigger and better opportunities. Why did you take the opportunity in Tas?
wender wrote:House call-Glad you got that out!! There is so much to learn and I love it. I am so excited to be able to be in charge of my future and not have to be a slave to the 9 to 5 (or in my case 6.30 am to 11.30 pm) ethos. Stamp duty- what can you do- the government has to have their share, no use worrying about it, just look for bigger and better opportunities. Why did you take the opportunity in Tas?Tassie-partly because like the place and it gave an excuse to visit, but mainly due to high rental return (8%) and continuing with the concept of diversification by buying in different states (as experts like margaret lomas et al suggest)
Have you thought of a" partner in prime". realestate that is…lol GL
Thanks everybody, you sure are full of info I hope I can be the same to another newcomer someday! I thought the aim was to get to 10% or above? I have found a couple of properties that return 7.4% is that good enough?
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