I have a slightly more balanced view than G7, but those pitfalls are all worth taking careful note of.

Assuming all goes according to plan and the railway arrives in 10 years’ time etc., there may be some growth. However, right now the prices are certainly high.

Bellbird Park may be quite interesting (I just bought in there). There’s a…[Read more]

All the details are at http://invest.dha.gov.au

Mick

I’d suggest you take a trip or 2 to Brisbane, perhaps on a long weekend or something. Get yourself a Bris street directory, work out where some of the suburbs are along the train lines etc., and drive around them and speak to some agents.

Dunno about buyer’s agents, except that…[Read more]

I agree with Nobleone – looks like an OK area, plenty of acreage around, but don’t have first-hand experience of crime rates etc.

I do however have first-hand experience of another acreage area – Karalee/Barellan Point. We love it there; 20km (as the crow flies) from the city, but feels like the country, very low crime etc., great…[Read more]

The best cheap data I know of is the API magazine. They regularly publish some basic stats; but if you need more detailed historical data you most likely need to pay for it.

Mick

Selling the unit doesn’t really give you more equity, because you’ll pay Cap Gains Tax and agents’ fees. But what it does allow you to do is to access the cash and pay out some of the PPOR loan.

Doing that reduces your non-deductible debt (“bad debt”), then you can borrow against it for another IP (“good debt”).

But since the equity…[Read more]

My place is on the beach side of the main road, but I guess still a reasonable way from the beach. I’ve only been to Waikiki once, so my memory of it all is a bit vague

First 2 years it didn’t really go up; last 2 years it has gone up a lot, but the rents haven’t followed yet.

It will be interesting to see how things go in the coming…[Read more]

Cheers,

Mick

I bought an IP in Waikiki a few years back for all the reasons you listed, so I’m hoping other people think “what a great place” too

Mick

Be very cautious of a product that can supposedly reduce your loan term. It has generally been shown that these kinds of products generally cannot do that, unless you make extra repayments. Banks were forced to take calculators off their websites recently because they deceptively showed this – but in fact relied on increased…[Read more]

Depends a bit on what state you’re in. Usually in NSW you put down the deposit, then get inspections done (at some risk), then exchange contracts.

In QLD you pay the deposit with the contract, and the contract has a standard condition on inspections by a certain date.

Not too sure about other states – but the systems definitely vary.

Mick

I would always use a broker since they should have a wide range of lenders to draw on and you don’t pay any…[Read more]

I’m reasonably local to there (Ipswich region), and a few friends have recently bought in Laidley, Minden, etc.

The prices have definitely been moving upward in the region; big new estates going up in all those places. Rental returns look around 6% from memory.

But to count on such a profit from building like that sounds a little risky to…[Read more]

Cheers,
Mick

Collingwood Park has new estates within an area that has been lower socio-econimic, but it’s definitely changing. For your budget, I reckon it’s a good idea.

As far as being a long way out; I personally disagree, but in Brisbane many people think that more than 10 or 15km out is a long way. But Collingwood Park is near both the train…[Read more]

Mick

Nobody on here can tell you what to do – depends on your priorities.

250k opens you up to tons of options in QLD, but I reckon you need to at least decide between houses, units, etc.

Personally, I like to be a low-maintenance investor, so I like new houses on small blocks, returning 5 or 6% and good tax deductions. But my mates put in…[Read more]

Ipswich council have a great flood map on their site, which shows 1 in 20 and 1 in 100 year flood zones, in case you have concerns about that:

http://www.ipswich.qld.gov.au/planning_development/pdfs/OV05.pdf

Note that in Brisbane there are many “stump” houses, but they’re not getnerally on brick stumps – used be timber, now usually galv…[Read more]

http://moneymanager.smh.com.au/articles/2004/03/10/1078594395323.html

Cheers,
Mick

There’s no reason I can think of why a bank should lend you money on 5 untis as 1 purchase rather than 5 places over time.

It is true that they will say “how on earth are you going to pay it off if you already have two other outstanding loans?” but they will also take the rental income into account – so as long as the rent stacks up well,…[Read more]

It has worked very well for me: I am fairly happy with their rent valuations, and they always pay on time. There are very few costs for any kind of maintenance.

I had a quantity surveyor do my depreciation…[Read more]

This is an age-old question that really only you (or your accountant) can answer, because there’s lots of variables to consider. But a few things to keep in mind are:

– People often get scared of getting pushed into the next tax bracket, but this is really not an issue: since you only get taxed at the higher rate on the extra income, it’s…[Read more]

I reckon you’ll find you can only claim tax against the original 450k you borrowed. Even if you refinance for more, you can’t claim it as an expense (unless the additional borrowings are for some other investment, then they’re claimable against that).

Cheers,
Mick

Mick

Yep, I’ve got a DHA place in Waikiki WA. It was my first IP, and I wanted to reduce risk.

It’s been great; there are no repair costs (except a tree fell down and had to get removed), and no worries about vacancy, tennant damage, etc.

I highly recommend them if you want a hands-off investment that you don’t have to worry about for 6…[Read more]

BTW, a fibreglass pool 9.2mx3.2m cost me $17k, including salt chlorinator etc. That’s excluding fence and surrounds, but $20k should do it easy.

I’ve found the fibreglass pool to warm up quickly. Also, the construction speed is great; kids were swimming 3 days after they started building.

Mick

I reckon you’ll find the answer is yes and no: yes, you could refinance that way, but no, you couldn’t claim the tax deductions so there’s no point.

The tax man doesn’t let you do this: he essentially only lets you claim deductions on the money you borrowed to finance the purchase. This is one of the big downsides to turning a PPoR into…[Read more]

Consider a fibreglass pool too. As long as you have a standard size, they are a bit cheaper, much quicker to install, look great, and easier to clean, etc.

Mick

One place that looked good from photo actually had a vacant block next door (with huge cyclone mesh fence) and the back wall of KMart towering next to that. Really glad I got to see it…[Read more]

5 years ago I very nearly bought a studio in a great Sydney location, but I bailed out when CBA told me they didn’t lend on studios at all at the time (regardless of size; that may have changed though, or maybe I was wrongly informed).

However, in hindsight it certainly would have had significant CG, but the finance thing certainly…[Read more]

So I consider my cashflow to be positive once the income plus tax deductions outweigh the costs.

Cheers,
Mick

I just refinanced 1 property with Homepath. They take ages, so I don’t think they could ever be used for a purchase, but for refinance they are pretty amazing: 6.15%, no fees, IO.

You have to apply through their website, then it’s all by mail and phone. Really a bit of a painful process compared to dealing with a friendly broker, but…[Read more]

Cheers,

Mick

Keeping things at 80% LVR, you really only have about $50k – you could use that to buy over $200k worth of IP plus all costs and stay under 80% LVR.

I say…[Read more]

Yep, I’ve got a good place at Waikiki that I bought back in 2000. The first couple of years it didn’t do too much, but the last couple of years that area has outperformed the Perth average and is forecast to continue to do so as the railway comes on line, and as new development at Rockingham happens etc.

When I bought, the rent…[Read more]

I also recall that one or two websites of home relocation companies in QLD had fairly detailed descriptions of this process, checklists etc. I think I found them through the online yellow pages at the time.

Regards,
Mick

1. The Brisbane inner city appartment market didn’t exist last cycle – it’s a brand new thing.

2. There is so much migration into SE QLD right now, and so many people who live here are from southern states, so the whole demographic is different.

I’m not saying…[Read more]

I’ve got one IP in Waikiki (Rockingham region, southern part of Perth).

It was CF+ when I bought it a couple of years ago, but CGs have meant that would be hard to achieve now.

The Rockingham area is doing very well because of increased infrastructure (railway extending, freeway widening, etc.) and I would still recommend you look at…[Read more]

I used a kit years ago in NSW; I found it a little stressful when something didn’t turn up day before settlement. Since then I’ve had some settlements get delayed etc., and was glad to have lawyers sorting it out.

So I would only use the kit if you were really skint (like we were the first time) and don’t mind the possibility of some…[Read more]