[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

January 5, 2004 - 11:58 am

Trunding, 3kms north of the massive CBD of Weipa.

Cheers
Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

January 2, 2004 - 11:34 pm

Hi Queenslander,

Goood question! To be honest, if i’d known about positive cash flow properties 12 – 18 months ago, I may have considered it, but probably wouldn’t have. I’ve heard of a few people (two, literally!) who took the plunge before prices inevitably went up, and now have good +ve returns.

Here’s some of the reasons why it would fail my due diligence:

The towns’ population, even when combined with Napranum, is under 5,000, its still a mining town, so there’s issues around there being no local council per se, power is produced by Comalco which may become a problem if the town ‘normalises’, and Comalco itself is very cyclical in nature. 10 years ago the workforce was over 1200, and by 2000 it was down to 450. Now its going back up, but with time, a new cost saving regime will be introduced and the workforce will be pared down to the bone again, there’s even been rumours about changing to fly in-fly out (just a rumour), and there’s no property manager now… It’s a funny old place, Weipa!

I could go on, but this probably gives you the general idea!

Cheers
Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 29, 2003 - 9:41 am

Hi Ron,

I went down to the newsagency today and found a copy of API – thanks for the recommendation. Looking forward to jumping onto the BusinessMall website and getting some books.

Good luck with the housemove, and have a great holiday.

Cheers
Crocodile

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 29, 2003 - 9:35 am

I’ve just come across an article in the latest API, (Brenda & Les Irwin, pp 32-38) where Brenda says:

“In my experience, it takes approximately 2.5% – 3% of your gross yield to pay outgoings. For example, if your interest rate is 7% you’ll need a gross yield of at least 10% (7% + 3%) to guarantee a cashflow neutral return (before tax).

Brenda ‘fully borrows’ to finance their purchases.

For me this statement had the aha! affect – so that’s the relationship between the rental yield and cashflow returns! Yes, I’ve been reading up, following this and other threads about yields, but just couldn’t grasp the connection. [:0)]

Cheers,
Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 28, 2003 - 10:28 am

Hi Ron,

We’ve got two properties in North West NSW – ones 100 acres, bought in 2000 and the other is 500 acres, bought mid 2002. The first one earns agistment, and the second we run our cattle on. We’re very lucky to have my father to keep an eye on things there for us.

We’ve made few mistakes with our two properties, but we’ve also had a few wins. Its all learning!

Rob works in the mines up here in Weipa (as most people do). We’re looking at investing in Cairns next year, but won’t be rushing into anything – I think I still have a lot of learning and research to do!

Rob came home from work last night and told me that one of the contractors he knows has been investing for years, and has 13 properties in Cairns. He must be doing something right! So we’re going to have him over for a meal, and see how he feels about doing some mentoring. Are you familiar with that saying – when the students are ready, the teacher appears – I’ve a feeling he might be our man.

Do you find API a worthwhile magazine? I haven’t seen it in our newsagency here, but can probably order it in.

Cheers
Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 28, 2003 - 10:05 am

Hi Mel

Is it possible to find out early about foreclosures in Aus? In some of the American books I’ve been reading there are ‘systems’ to profit from them – I gather waiting outside a courthouse or similar and making an offer to a likely looking person (maybe easily identifiable by the tear tracks?)

Seems a bit morbid to profit from others misfortunes, but as they say, you make your profit when you buy.

Cheers
Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 28, 2003 - 12:04 am

Hi Mrsspud5,

Welcome to the forum. An interesting conundrum!

Some questions for you:
Does the 1/4 share entitle you to live in the third home, or would you have to make some rental adjustment to your friends Mum?

How much rent would you be able to charge for your existing home?

How marketable do you think the 1/4 share would be in the future?

Cheers
Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 27, 2003 - 3:17 pm

Hi Guys, and thanks for your replies.

I’m much clearer now about yield – cheers.

I really like the idea of an indicator to unlimited properties! Lucky I have a risk-adverse other half to keep me in check sometimes.[]

Seriously though, we’re struggling with repayments on a property at the moment, which will be positive cash flow, once the drought breaks, and the cattle fatten, and we heal the salt scald, and the birds stop flying backwards, and, and…..

So I’m really sold on +ve cash flow – where it flows from day one!

Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 27, 2003 - 3:02 pm

Hi Steve,

” As we move into a buyer’s market, there will be a lot more problems to solve.”

What can we expect as we move into a buyers market? I can foresee that as interest rates increase to around the 8.5% mark (Making Cents of the Statistics / Melbourne market) that the decrease in demand will dampen prices a bit, but as investors we will still have to juggle interest rates against price. What other problems can you see in a buyers market?

Cheers
Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 27, 2003 - 2:54 pm

Hi Ron,

I had a great Chrissy, thanks. I’m curious to know if you invested in Cairns while you were there. Apparently the market has taken off in the last few months.

Cheers
Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 27, 2003 - 3:39 am

Hi Jancrows,

I was wondering how big the acreage is at your PPOR – would it be possible to lease the acreage, thus removing the work involved in its upkeep (and providing another cash flow), keep living where you are, and then buy a second (+ve cash flow) property purely as an investment?

Cheers,
Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 25, 2003 - 2:12 am

Hi again Guccigal, and Merry Christmas!

I agree with Peter that the homes themselves are a tad overpriced. We’ve been considering shifting a home onto land we own near Gunnedah, but feel with patience we will find one for much less than any on that site. In the meantime, our land is still earning a +ve cash flow for us from primary production.

I should have been a bit more explicit in my earlier post, and directed you to a section of the Dalby Home Removals link, called “Relocation Info”. There it lists all the costs to be considered in shifting a house, and numerous other considerations. It also lists the price of a move per km – once you are beyond their free 100km delivery radius – as being $30/km for a single shift, and $45/km for a double shift.

Cheers,

Crocco

[CrocodileParticipant@crocodileJoin Date: 2003Post Count: 15]

December 23, 2003 - 3:43 pm

Hi Guccigal,

Have a look at this link for the cost of house removals; http://www.dalbyremovalhomes.com.au/.

It’s quite a good site, though its based on you buying a house from them for relocation.

Cheers,
Crocco