[devo76Member@devo76Join Date: 2007Post Count: 542]

June 18, 2010 - 1:54 am

What i would say.

Hey Steve. you have done real well purchasing land to build on while all your mates blow there cash. But instead of buying that one block of seven in your couldersac. Why dont you buy all of them. You can afford it easily., Sit on them for 2 years.Let the boom happen. Then sell of 3. You would then have enough funds to build on the other 4 and pay off all debt leaving you with around $1300 per week after costs. Do it Steve Trust me…….

hindsite is a wonderful thing.

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June 8, 2010 - 6:23 am

Yes thats a distinct possibility. I for one do not buy mc mansions. Im concentrating in a bit closer to cbd hubs. Regional mind you. Havent got to the cities yet. But i am assuming here that growth does return. Big assumption i know but it will happen one day.
How do you see the different markets traking if this happens.

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June 7, 2010 - 11:28 am

I have a question that i havent recieved an answer for yet. Not worth its own thread but well within the context of this one.

Australian property is often compared to other countries in regards to it being very expensive.
But most of these countries are in dire financial trouble.

My question is what do we believe will happen to the property values in these countries after they recover.

America for example. When/if  they turn the corner. Do we expect there values to stay low. Return to normal growth or would you expect a rapid recovery of values.

I ask this because of what i believe may happen.
In a nutshell
Australia will have flat to moderate growth over the next 7 to 10 years while other countries in debt problems will see stronger recoveries possibly overtaking Australia at some point. But this would only be if they recover from there debt problems well.

No graphs,no data,no insider info. Just a gut feeling and a bit of a realist approach.

What do others think.

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May 25, 2010 - 9:37 pm

Hi.

My IP has a council approved granny flat. Things may vary councill to council but.

Our council does not care if you rent seperately. In fact they encourage it. You do not need a dual occ because it is not a dual occ. I confirmed this recently because im building another house on my block. If the granny flat was treated as a dual occ i would have been unable to build but there was no problem luckily.

I would advise you to get the flat seperatetly metered both for power and water. Once again council does not worry about what you do here as long as the power is done by a qualified tradesman.remember you will require an additional bin and when it comes to a mail box. Just add one next to the existing one with an a attached to the number. The postie will work it out. No need to go any further than that.

It will help greatly if you can give both the house and the flat there own privacy. If they are living in each others back pocket it will effect rent. Corner blocks are great for this. I was lucky that i found a 1000 sq corner block property that needed a light reno and already had a granny flat. Bit of a trifecta really. Hard to find now but i would settle for a un-subdividable corner block that allowed for a well positioned granny flat.

An example of how good granny flats on corner blocks is this. Of the 10 couples that looked through my house to rent. Not one was aware that their was a granny flat.They could not see that it was attached. They thought it was next doors property. For this reason i achieved full rent on both. Just something to keep in mind. Position both as best you can to allow their own space.

Cheers.

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April 19, 2010 - 9:32 pm

You have got me thinking.
There are a couple of streets in my area that are known no go areas. Lately i have seen many pop up for sale. Im sure they are public housing. I better go check out the next auction.

I did notice that they all say, Conditions apply. You may have to allow currrent tenents to stay on until there new housing is built.

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April 15, 2010 - 9:19 pm

Never done it myself so im only passing on what i have picked up in conversations and forums. You would have to be very carefull and do complete feasability studies. You may turn a large supply of cash into a small one if not carefull. Many variables like rates,sale prices and timeframes may affect your end profit. That being said it is possible and people do it. Just crunch your numbers well before hand.

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April 15, 2010 - 9:15 pm

I may have to talk to a few of you guys in the near future. The house im building now will max me out for land tax in NSW so i will be looking further away. I travel to Adelaide several times a year so thats where im looking next.

Talk soon hopefully.

Cheers

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April 15, 2010 - 9:08 pm

fWord wrote:

Matt_Arnold wrote:

Yep…   the economy (the share market is one of the best examples) is predominately driven by emotion.

Cases in point would be a) how the economy seemingly rebounded overnight last year after all the talk that we were in for the worst ride of our lives, and b) the recent dip in the sharemarket caused by some big shot opening his gap to say that something will be done to cool the market.

In either case nothing had actually changed and yet the economy and share market (over)reacted. This leads me to believe that the run of the mill people are the ones who decide on when the market booms and when it crashes. Yes, run of the mill people like your mates at the bar-b. When everyone thinks the economy is recovering they pour money into the market which occurs as retail sales, increased investment into shares, property etc. When everyone thinks the economy is going to the dogs they panic and pull money out. Supply and demand. When nobody spends, nobody buys, prices fall. That causes the economy to change.

One of the books I read made an interesting comment. One of the ways to ascertain what stage the property market was in would be to see what opinions were on the minds of others.

Things are the pits when nobody is talking about property anymore. And when a good number of them say it's a 'bubble', they only think it is. But it's this thinking and frame of mind, that when taken upon by enough of the population, causes a real 'bubble' to actually occur. Effectively, things that are perceived by the majority of people do become self-fulfilling prophecies. Looking at it this way, it's great to see articles in the newspaper preaching of the boom of the RE market. If everyone keeps this up, the boom will continue.

My thoughts exactly.  Economists would do a lot better studying people not markets sometimes. I think there batting average would improve if they did.

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April 14, 2010 - 11:08 pm

With the original post removed both DWOLF and myself look mad  

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April 14, 2010 - 9:48 pm

Me to buy now please money send detail of credit quick rush please yes no ok !!!!!!!!

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April 14, 2010 - 9:17 pm

I just had a look at a property at Pennington in Adelaide.( Realestate.com.au)
9 Kms from the CBD.
Close to the redevelopment of the racetrack
Southern edge of pennington which is the better side.
A couple of klms from the beach

Now it is a 3 bed + study house with a 3 bed granny flat on the back.
It actually has about 10 seperat rooms all up and has been used as room by room accomodation.
Needs a bit ( A lot)of work but Nathan on this forum would eat it up i think.
Asking $365,000 but VERY negotiable apparently.

Will someone please buy this as i am tied up elswhere at the moment and im being tempted to chase this one also which i really cant  do for the next few months.

cheers

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April 14, 2010 - 2:01 am

Spot on. Im just lucky i did buy . Wish i bought more but.

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April 13, 2010 - 9:18 pm

I am subdividing a corner block in a regional city and the costs for my Town planner should come in under $10,000 total( Plans,council corrispondence etc) but i imagine the price would be heavily effected by location.I should see a 40% to 50% profit so the cost of a planner was well in the budget. I would not like to do this myself. Not yet anyway.

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April 13, 2010 - 9:04 pm

wealth4life.com wrote:

Dear Devo darling you miss understand me,

I bought a golden oldie in warrawee in 2008 December for $701,000.00 and have approved plans for a 40 m/2 house – I have been offered $950,000.00 as it is which is a $250,000.00 gain in less than 15 months.

My team is very active in real estate and our nett target is always one million a year.

I provide news and information to balance out all the BS and to get the message out that real estate needs intelligence applied with correct decision making to make perfect decisions.

Danielle

Danielle my precious i never questioned the size of your portfolio i am just saying that in the spirit of a famous movie ,you seem to have an unhealthy facination with the dark side. I agree you need a balanced argument and if you post in the interest of doing this then well done.But there is a constant theme and a constant moving goal post that gets a little tiring.But all in all i still like your posts. keeps everyone honest. Myself included.

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April 8, 2010 - 2:40 am

If i didnt buy when W4L suggested a bubble was comming earlier. I would have missed out on the growth of the property that i have now expierienced. Infact it would have to drop 15% to get close to where this bubble was meant to burst. Thank god i did what i wanted.

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March 4, 2010 - 8:22 pm

Shoalhaven region on the south coast of NSW may do well in the future.

#Good job growth  prospects with big Defence/aviation contracts being awarded to the Naval base there.
#Redevelopment of the CBD and actuak development of the Nowra riverfront finally on the Table.
#Close to beaches/mountains. 2 hours to Sydney and 2.5 to Canberra
#New road to link Canberra to the coast with Nowra the coastal connection. Knocks a lot of time of the trip. Look what it did for batemans bay.
#Highway now at preferred route stage from Kiama to Nowra. When built it will be dual carriage all the way from Sydney to the south coast.
Affordable housing compared to neigbouring areas.
# Rising population
# New jail to the south almost built.Employment plus.
# many other big developments in varying stages. Island resort,shopping center expansion,green farming,ethanol plant.
# one of Terry Ryders top picks for NSW.

Some bad points
# Above average unemployment although i think it is by choice for many.
# Part of above. It has a bad arer just dont invest there. problem fixed.
# Still a little too far to commute to Sydney although many comute to Wollongong.

Disclamer

I may or may not have a few properties here. ( I do)
I have lived here a long time but travel often and have seen much of Australia so i think i can give a valid opinion.

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March 2, 2010 - 8:46 pm

kyanfable wrote:

Hi guys

I'm posting this on behalf of my brother in law. I would appreciate any help/ideas/assistance. We are both stuck on this one!

I'll keep this as simple as possible.

Property 1 – Value is 600k. Paid off no loan.

Property 2 – Value 300k , 344k loan

LOC – 50k (has not been drawn down at all)

Bank has Property 2 secured against Property 1. My brother in law wants his title deeds back and to purchase Property 3 in next 6 months.

Can anyone comment on how structure the loans, the bank has said he cannot get his deed back for Property 2 untill the loan is reduced to 80%. His focus is to borrow funds to purchase property 3 whilst trying to get out of the cross colatteralising.

What would you do??

Thanks guys!

I am kind of in the same boat. I have a PPOR with a small loan.
IP1 was split into two loans in an effort by mr Banker to reduce my LMI. End result is a $250,000 loan secured against the IP and a smaller $54,000 loan secured against my PPOR. ( I know better now). Unfortunately the smaller loan of $54,000 has effectively locked me out of using that portion of my PPOR equity( Or another IP as i like to think of it).

The only fixes i can see in my situation is.
1# revalue above total of both loans…….. Sadly not an option. Flat market still around here.
2#Pay down $54,000 loan……….. possible but best to pay remainder of PPOR first.
3# Sell IP………… Possible again  as it is underperforming but would sell at a loss atm i believe.Do i want to crystalise the loss.
4# Move into the IP.
5# do nothing

Sounds funny but option 4 is probably my best option for a number of reasons.

#We intend to sell our current PPOR in the next few years due to a possible bypass going in 5o meters away. It will not happen for 15+ years but once it becomes public the damage is done.
#We would love to live in the the IP due to cbd living. Resteraunts 200 meters away. How cool is that.
#Cash from PPOR sale would  reduce the current IP loan to stuff all as well as removing the cross-X plus the transfer off equity to new PPOR should release more funds to buy another IP or two.
# the new PPOR would respond well to a renovation turning it from an average property to a valuable property but a reno is something we could only do while we lived there not a tennant.

So while your situation might be different. These are my options that you might be able to get something from.

Cheers.

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March 2, 2010 - 3:51 am

March 2010 and no crash yet

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January 29, 2010 - 8:47 am

wealth4life.com wrote:

There seems to be a lot of talk about some price increases lately especially in Victoria but can I share some thoughts with you for discussions … I am in fact writing a report for a bank so I will use some extracts for your consideration.

Firstly I am noticing that the low end of the real estate market eg: new H&L estates in outer suburbs of our CBDs have infact increased in price … HOWEVER …

Valuers value property on many facets but of the most is LAND SIZE … Mum and Dad lived on a quarter acre lot, if you are a gen Y that is about 1000 m/2 … lot sizes now on new estates are down to 350 m/2  (the great Australian dream is shrinking)

2 Years ago lot sizes were down to 650 m/2 and people complained … so the first thought provoking questing I have put to the bank is … How do you calculate true value …

The other concerning factor is the HOUSE SIZE … 4 bedroom + DLUG … reads and sounds good ???? however we tested a few … in one display home in Victoria we parked 2 holden commodores in the garage and couldn't get out of the cars … the salesman answer was … wait for it … the average Australian car is smaller than what it was 5 years ago …

Have you noticed why so many builders and marketing companies don't write the dimensions in the floor plans any more ?????

Have you ever wondered how you can get 2 adults and 2 children into the kitchen, dinning and lounge area all at the same time in these new homes, don't turn on the television what ever you do …  or invite people over for a BBQ.

Summary: Yes prices are going up but at what COST … smaller houses on postage stamps … my friend a solicitor has a saying "tomorrows slums today"

I agree. My ppor has 4 beds. Double garage, ensuite 3 living areas. Nice on paper but what makes a house is the space between rooms . New homes don’t have much of this apart from the top end. My 50 year old rental is a three bedder and no garage yet it has the same area. The hallway was advertised as a dining room by the agent. I like this in old homes.

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January 14, 2010 - 10:07 am

mattnz wrote:

This article advises us that the average mortgage in NSW just hit a new record of $414k. That isn’t the average house value, but the average mortgage!!

http://www.smh.com.au/business/westpac-rate-rise-pushes-customers-to-switch-banks-20100105-lsbd.html

Let’s combine that with median household income stats…

Median household income is only $1036 in NSW (2006 census), so lets assume it may be $55k per annum now to allow for wage growth.

http://www.leaseinfo.com.au/docs/research/2006%20National%20Census.pdf

After tax this equates to just under $44k per annum. When interest rates are back at 10% again, interest alone without paying back any capital will take $41,400 of this $44k income. This is a serious problem waiting to happen!!

So yes, people are too highly geared and increasing interest rates are a guaranteed property bubble collapse.

where does it say that the average mortgage has to be in line with the median wage ?

A house is a big purchase so why should it be affordable to low incomes. The two are not connected