Positive or negative geared property?

Hi Brmiau,

Hope you are well? Firstly good luck with your goal and its great to see people setting goals, So important in life.

These days there seems to be a rush in retiring or "working for your self concept".

For me personally I would never retire, I would get bored and I would drive my wife crazy. But having finical security is another thing and this is something i encourage to every one.

There are various tools and methods to create wealth and we live in interesting times  as well.

you are planning to borrow 2 to 3 million to make 2K a week which = $104,000 income PA per year. Not a bad goal at all!!!!

But if you are looking at leveraging your properties to the HIll I am not sure if this figure can be achvied.

Sorry – I missed this last post. You can choose your broker from anywhere in the country. Everything is done via email/phone these days. 

So choose someone you'd feel comfortable dealing with and get in touch – I assume we're all taking on new clients at present.

Cheers

Jamie

It's great that you are beginning to look at real estate investing at such a young age.  Just be very cautious with your borrowing and debt.  Very challenging times are ahead of us and what something is "worth" truly becomes what a cash buyer is willing to pay for it.  You don't want to be so leveraged that your house of cards comes crashing down.  Debt honestly scares me and I prefer all cash or to partner with other cash investors.  The real money in my market isn't made in owning the property, it's partnering with those who know how to get it done and can return double digit returns, (10% to 30%) per deal.  We create shared housing and you may want to consider doing that even with the property in which you currently reside.  Maybe you take in a renter or two and see how that goes…..then buy the next property to live in and back-fill the space in the old place with a shared housing renter.  Just a thought.  Maybe you build-out what we call an in-law suite in the basement level of the next place…makes a prime rental when you move onto the next place.  Granted, I'm from across the pond so no idea where my idea has any merit in your part of the world but I would think that it does.

I recently got laughed out of a local real estate investors group when I mentioned that a recent cash partner of mine had gotten over 30% return on a $30k US investment in just under 6 months.  The real return was actually a little over 40% in 6 months.  We partnered to buy a very low end townhouse unit I had found…it was a 2bed/2bath and I converted the living room to a 3rd bedroom.  We bought it for $15k cash and spent $15k on repairs.  We created shared housing out it and got $1,500 a month in gross rents.  Bear in mind that we rent rooms as shared housing so we furnish the common areas and include basic utils in our rentals.  Once the rents were stable, we sold it to a passive investor for $55k.  My agreement with cash partners is 10% plus half the profit on the sale so he took home $3k in interest and $11k in profit share.  Our back-end buyer purchased a property worth about $80k based on cash-flow and we guaranteed him a 10% cash-on-cash return for 18 months.  If it doesn't perform, we have to make up the difference out of our own pockets.  I let them laugh…the only laughing my partners are doing is laughing all the way to the bank!  The cost structure in Australian wouldn't allow for my model to work but I'm certain that shared housing works in almost any market.  Housing options in the US is very limited for renters with credit or income challenges so the market for shared housing is huge here and likely will be for another 10 years.

Keep reading and learning….I do the same every day!  all the best.  Andy