New To Investing and looking to get a Portfolio a few questions

I agree with xkfalcon, one stop shop rarely makes good investment. It will be a big loss if you will invest off the plan.

business growth consultants

Hi Paul,
I have recently met with these guys too. While they offered all the services, they didnt twitch when I said I would still use some of my own advisers.

What happened with your process. Did you get out?

Hi Jeff, 

There are approximately 250,000 properties for sale across 15,000 suburbs in Australia. Of those properties you could say 100,000 are possible investment options. In reality only around 1000 properties on the market today would make a great investment property for you to hold in your portfolio. So the trick is not to buy one of the 249,000 other properties on offer.

The only way to find the right properties is by researching the market and knowing and clearly defining what you are looking for. So knowing your strategy and having your strategy clearly defined is absolutely key. With a clear strategy you'll have mastered 75% of the loss making issues you will encounter when building a portfolio. 

<u>To say buying Off the Plan is not a good portfolio strategy is completely unsubstantiated nonsense</u>. I have very wealthy clients with 10, 20, and 50+ properties in their portfolios who have been buying Off the Plan continuously for 15+ years and they do know what they are doing. I have a couple of clients that buy one property every 60-90 days Off the Plan.

But don't get me wrong, if you buy one of the other 249,000 properties on the market for sale right now you will be buying a dud, and nobody wants to be doing that, an Off the Plan property or otherwise. Buying from a marketer company would one way of nearly guaranteeing that you are buying a dud.

When clients call me for help (for a portfolio rescue) they invariably have been dud'ed by a marketer company sometime in the past. I have one new client right now, who has 4 properties bought between 8 & 12 years ago. The best property is just gone positive cash flow (after 12 years) and has grown by 30%. The other three properties are still cost them $450.00 per week. They are both 55-ish and are starting to get scared that they wont be able to afford to retire. In this case they blame their accountant for telling them to go and buy a "Negatively Geared Property", what their accountant forgot to say was "in a high growth area". Our research shows that the average negatively geared property needs to grow at 8-8.5%p.a. to be a profitable investment. 

Aim to buy into a area that's going to grow, buy the property the rental market most wants to rent (our research shows it's most likely to be four bedroom houses & 1 bedroom apartments), buy the affordable product and not the most expensive. There are less renters as the rents get higher.

Buy for Yield (to hold your asset), Growth (to build your wealth), Tax credits (to increase your portfolio's efficiency) 

• Principal Place of Residence is all about Location, Location, Location
• Investment Property is about having the right Strategy, Location and Product

This forum is loaded with good people with a lot to offer, ask the right question and you will get the right answers.

Good Evening Richard,
I am yet to see the properties /land available or be told the area. I have told them I want this information before looking at what is available to do my own due diligence, and workout the market price in the area.
Certainly when we do the maths, it all looks positive, once tax allowances are made, but my concern lies with if the properties are heavily inflated, and won’t see the projected cap gains they have identified.

Surprisingly, it wasn’t until I read an article in API that my concern was raised – not specifically about this company, but about other schemes/scams that do exist. The article points out that there are some groups out there who are legit, but sorting them from the others is the obvious challenge.. I will remain non committal until I can be assured that it us a good deal.

Will keep everyone advised.

Richard, that said, I would like to have a chat with you to see how you might be able to assist my getting started. I will give you a call this week.

Thanks all.

@david any update on your dealings with APAS?

Regards,

Hi,
Me and my partner are also new to the whole IP side of things and have just recently had a meeting with APAS, judging by the above comments it’s not really the way to go? How did you guys end up going with your dealings?

@knightm thanks for the response mate,
In all honestly we have only just scraped the tip of the ice berg with APAS. We only have had our first consultation and have booked in for our second early next week to discuss in further details about potential properties in which state and suburb along with a more detailed break down of our finances etc.
Going through a “one stop shop” kind of set up is not something I’m totally comfortable with as I’m a very skeptical kind of guy.
A little breakdown of where my wife and I are at, open to suggestions.
My wife and I finished building our home around 12 months ago in Western Sydney
Looking at purchasing an investment property to start building our portfolio,
Our current property has just been bank evaluated at $630,000
Current mortgage stands at $495,000
Currently having $95,000 in savings in our offset account. (Effectively our mortgage says $400,000 even)
APAS have suggested/promoted OTP style properties that will be negatively geared at a cost of no more than $100-$150 per week out of pocket expense to us.
We would love to invest in Sydney but given the way the market is at the moment we can’t see this really happening as it’s just too ex naive.
Thanks for your help.

Shannon wrote:

APAS have suggested/promoted OTP style properties that will be negatively geared at a cost of no more than $100-$150 per week out of pocket expense to us.

Wow ouch. You’re happy to lose that much per week? That is a decent amount to be out of pocket every week. Also it will be worse if you were suddenly not working and had no income to gear against. Also it’ll make getting your subsequent investment properties much harder because your ability to service the loan with your available income will be severely compromised.

Often OTP properties that are recommended to you earn the recommending party a nice hefty commission.