Forum Replies Created
remember that a positively geared property for someone else wont necessarily be for you.
Obviously the longer you hold onto a property
1. The rent goes up
2. The loan comes down (if you are paying off principle)So eventually they will become positively geared. But when the property is sold the new owners will owe a higher percentage
on the property inturn making it negatively geared (normally)In the past I have people talk about their property that they are selling as being 'positively geared' and some people who are new to investing simply think it will be positive for them too
besf of luck
wealth4life.com wrote:Seddar …The difference between the rich and poor is knowledge.
I tend to disagree slightly – I believe
The difference between the rich and poor is not Knowledge BUT the application of knowledge.
I know plenty of people that told me the stock market was over priced a year and a half ago but how many of them took advantage of this and bought puts?
I know plenty of people who have preached about property being a great investment but have never bought an investment property
Most people in Australia will tell you that buying their house was the best investment they ever made – but how many then decide to buy a another one or two or three?
Knowledge is SO important but its what you actually do with the knowledge that really counts
Cheers
Banjo
Hi guys
I think most things are pretty similar.
The main differences would be bigger things that don't necessarily affect renters.
eg. structural, wear and tear on building, gutters, decking etc.
On one hand its easier to please buyers because they know that the can change it if they want to.
But at the moment renters can't really be to fussy
Cheers
Banjo Smyth
Hi Kenzel
You definitely shouldn't be charged.
It's always interesting to get 3-4 different appraisals and to see how they differ.
Even if you are planning on managing the house yourself you should still get multiple appraisals.
Make the real estate agents earn their money
Cheers
Banjo
Hi Mate
Congratulations on being motivated at such a young age.
The first thing to consider is the 'first home owners grant' (or whatever it is called these days
If you buy an investment property you won't be able to claim the grant. To make it worse when you do buy your first PPOR you won't be able to claim it either because you will have already purchased a property.The second thing to think about is the mortgage reypayments. Can you afford to live in it – or would it be better to rent it out and rent somewhere yourself (better still stay with your folds for a while). You will also get the tax benefits of this.
I think it is definitely worth getting the first home owners grant – this means that you will have to live in the property for 6 months. The FHOG will roughly cover your mortgage expenses for this time to you can see it as free rent for 6 months. Better still you could use the 6 months to do some small renovations and revamp the property a little bit.
Best of luck mate!
Cheers
Banjo Smyth
Yes floor boars can be cold in winter but you can always put some rugs down.The great thing about floor boards is that you don't have to worry about stains etc like carpet.
I think it comes down to personal choice. My prefernce is floor boards in living areas an carpet in the bedrooms.
I love themodern look that floor boards bring!
Good Luck
Banjo
Hi mate
I guess i am a bit late with my response
But i was going to suggest that you think about what direction they are facing?
Getting the morning and afternoon sun in the right areas can make a huge difference to they feeling of a house.
Cheers
Banjo!
ps best of luck with your 2 new properties!
Hi tugga
By the sounds of it you are planning to basically re do the kitchens but you can make a big improvement without doing too much damage.
By simply redoing doing the
– cupboard doors (you can normally sand and paint these – you can even get laminex paint these days)
– stove, dishwasher etc
– Bench tops (these are very easy to put on top of the existing structures)
– tiles (if you use white knight tile paint you don't even need to replace them)anyway just an idea if you wanted to do a cheap and quick renovation
Cheers
Banjo Smyth
Another positive post from Scamp
You should definitely get another agent!!! Don't mess around – Especially because you aren't close by to the properties!
Cheers
Banjo Smyth
Hi Jonas
i think the strategy you are thinking of is as follows.
What most real estate investors do is to try and build up a 'buffer zone' of equity. In your case you have built up a buffer zone of $200k. The next step would be to get a line of credit so that you have access to that money (you will only need to pay interest on this money if you actually use is – other wise you will pay NO interest on it). Then rather than use all of your equity for the deposit on the next house you would only use as little as possible.
Lets say you brought a $300k property and managed to get a 90% loan – this would mean that you would need $30k of your equity (plus roughly $20k for stamp duty and expenses). If this was the case you would still have a buffer of $150k. This money can be used to help pay the interest repayments on both of your loans. This may sound weird as you are eating into your equity in order to build more equity! Does that concept make sense? The reason why Investors think this is ok is because they assume that house prices will go up and in a few years time they can get their properties refinanced and their equity has increased – and therefor so has their buffer zone (despite using some of it to pay off the interest of their loans)
I'm sorry if this post is a bit confusing
The main question you need to ask is. . . . Are you comfortable using this strategy in the current conditions? That one is up to you to decide
If your buffer zone isn't big enough and property prices dont increase then you could find yourself in some trouble. Cheers
Banjo Smyth
Hi guys
I doubt you will get any tenants who are willing to pay to much rent for a block of land – Unless the own a swag
The lack of income is clearly a huge factor.
If you are simply a normal everyday investor I don't think you can go past a land/home package. I have heard of some more advanced strategies which basically involves buying land of the plan – eg. buying land very early in a development. But that is always with the intention of either on selling it or building a home within 1-5 years.
Cheers Banjo Smyth
Hi Wade
Where is the Property?
There is nothing wrong with investing in a unit but it depends on where it is located.
The general rule with negative and positive geared properties in Australia is that the
negatively geared properties = more capital growth
positively geared properties = less capital growthObviously there are some exceptions, but you would normally find the more 'positively' geared properties in rural, country or mining towns.
I would also do your own extensive research on house prices and rental returns in the area and make sure that 'your' figures match up with the 'real estate agents'
Investing in a neutral or positively geared property can be great (especially for a beginner) but remember that the main reason why you are Investing is for longer term capital growth (i assume). If you aren't going to get this capital growth then you might as well put your money somewhere else.
Hope that made some kind of sense
Best of Luck!
Cheers
Banjo Smyth
