Forum Replies Created
CG/+CF all have their places.
One needs to think of whether they want security or freedom and whether they are investing based on opinion or fact.
Myself, I want to have the freedom to do what I want to do and base my investments on fact. I will know how much I will get per month from +CF (fact) and have the freedom to do what I want when I want.
In my mind to try for CG based on -CF you need to have security (a job to pay for the -CF) and your future earnings are based on an opinion (that’s my opinion any way [biggrin]) that the property will increase by x%. Lose your job (very real these days) or you opinion is wrong (seen this before including myself) then you are in deep trouble.
Later………
Sounds like you should have done the numbers first before you bought it as you may well be coughing up a bit every month. At least you took action and you’ll learn and do better next time.
What about selling it on a lease/option?
Or how about seeing what depreciation you can get and an ITWV done to vary you tax taken out of your pay and you might just be able to pay for it.
Later………
Speak to an accountant and lawyer (preferably in that order)………..
Qualified civil engineer (doesn’t mean I’m nice[angry2]) and worked for 15 years, 9 of that in government (dead end) and 6 in private with the last 6 months setting up and working for my own small company (real fun).
That pays the bills.
Like to think myself as a property invester as it’s more interesting to people and even more fun making money for nothing.
Later………
If you think they aren’t any CF+ properties out there then there isn’t. If you think otherwise, there is.
I’m in the process of closing on 2 myself so I must think there is [thumbsup2]. You don’t always have to work on raw yields, think outside the square.
Trick is, if you do find something, you need to be very quick in assessing the deal or locking your offer in with weasel terms to get out if the deal goes south [upsidedown]. Else they dissapear very quick.
Having said that, never pay too much. Nothing worse in getting into a bidding war [grrr] over a CF+ property like seagulls over a fish head [puke], which appears to be happeneing in some places.
Later…….
There are more ways to skin a cat.
Trying to make money out of 2-4% yields is impossible.
Think outside the square and there are plenty of ways to make money in a downward, upward, sideway and every which way property market. Not just B&H but plenty others……….
Later……….
Jaffasoft
All depends on how the LO is set up, each is different. It is your deal so it is your rules. Say 10-50% depending on how long they’ve been there, 10% in year 1 to 50% in year 5.[buz2]
Acts as an incentive to eventually cash you out and not just stick your toe in the water and try it out. If so, they should stick to plain renting.[cowboy2]
They can be set up realy as differently as you can imagine. Get the tenant to pay for all maintenance and rates etc if you can. In the end it will help your bottom line.
IRR’s of close to infinity are not unheard of and very real!!!![biggrin]
Later……..
I don’t know about anyone else, but can you eat a house?[blink] Can it feed you?
It’s funny reading books like Steve’s which is really based on CF+ to let you retire early because the houses allow you to eat from the CF+ but a lot of the word on these forums are saying it’s too hard and use CF- to create wealth.
Too hard I guess [confused2] and OK if you don’t mind working for the rest of your life. Been there done that and life is too short to pray for that day some day in the future where you can retire.
I’d rather do that now. [cigar] I thought that was Steve’s book was all about did it and it works.
I guess people need to see the light one day and realise what they need to do. It’s just frustrating seeing what others say, thinking that losing money is making money, but it is their opinion and that is fair enough.
Later………
Can anybody guarentee that in writing?[eh] They won’t because they can’t.[thumbsdownanim
All you can be certain about is today, anything in the future is literally fortune telling. Ok if it comes off, and it has lately and more than likely will, but I would rather be creaming it each and every month now than having to pay out of my own pocket and pray my investment goes up in value, whatever it could be, nothing, something o backwards?[upsidedown]
I just like to eat my cake now.[oink] Anything I get on the backend is a bonus.[wink2]
Later……..
PM
That is correct. Regionals can give more CF+ and they are “up north”.[withstupid]
There is enough fat [biggrin] to allow for rates going south.[angry2]
I’m of the thought that money put in your pocket now is a hell of a lot better than praying that your $50 $100 or what ever you fork out of your own pocket may be worth some thing later.
Later……..
Can I just ask why buy in Perth?[ohno]
You are basicly buying on a gamble that prices will go up (they generally do but can anyone tell what the price of a property will be in 12 months, impossible).[thumbsdownanim
Unless you manage to CF+ it you are just plain gambling with lots of money. I’d rather get a cut every month and there are places outside Perth that will do that for you easier for a B&H but you can do LO’s etc in Perth if you want to lock in you profit now.[thumbsupanim]
I’d rather be certain of something now rather than living in hope of something in the future.
[jerry]
Later……..
Why sell?[blink] I’m buying.
Live in WA and there are deals still around although hard to find.[jealous]
Just picked up 2 CF+ properties the other day. Another $700 per month in my pocket woo hoo.[lmao]
Later………..
Hot Rod
Redwing wrote……….
Originally posted by redwing:Holiday area for Kalgoorlie miners as far as i know, very slow in the ‘Off” season..But ‘yes’ some activity there at the moment on development side..as far as i know..
Wow! Have they moved Exmouth? Last time I checked, Kalgoorlie was 600 clicks east of Perth and Exmouth 1200 odd clicks north of Perth![wacko]
All this discussion about -ve gearing is all good and fine when you can claim a deduction against all your LOSSES, but this assumes that it will last forever.
I recall reading one of the RDPD books about the US govt removing negative gearing and then the bottom fell out of the market because of all the people losing $1 to make 50c had to get out. Guess they could stand losing $1 and making nothing (go figure?).
They said back then that the govt would never do it. Lo and behold, they are talking about it now here in Australia. It may be unlikely to occur but they said that about the GST when Keating was in power and lo and behold what have we now?
I always view -ve gearing as a bonus and not to rely on it to make a property +ve cash flow.
All comes down to minimising yours risks whilst maximising your investment.
But at the end of the day it’s peoples choices………
Testis????
Hurts to buggery to get hit there[xx(], but let no one take them off me!!!
]Later……..
This property was in northern country WA.
Actually flew up there and spent a day looking at the town and looking at what your dollar can get and your returns when I got my first 2. Must have given him the impression that I meant business or something cause he is on the blower as soon as there is a property that fits my criteria.
This one I just got did not fit all my criteria but the rental return will make up for not meeting all my other criteria.
Just phoned him to see how he was, and lo and behold, another deal!
Let me have a go….
I thought DinoWeb was correct but luckily saw your answer.
The following assumes interest is compounded ANNUALLY at the end of every 12 months. Nothing mentioned about when it compounds.
D = deposit
D x (1+0.104)^15 = 2,000,000 + D
4.410990281D = 2000000 + D
3.410990281D = 2000000
D = 586339.99This $586,339.99 is deposited.
You get $2,000,000 back and your deposited $586,339.99 deposit still remains. Nothing mentioned about getting your deposit back only a return of $2,000,000.
ta da!!!!
Me too!!!!!!!!!!!
Negative gearing can not save you money. By it’s very function you have to lose $1 and hope to get back at most about half that! You are still in the hole.
Negative gearing will only pay off if you have a guarenteed capital growth. Easy to predict now, but could head south at any time in the future, anyone’s guess.
I’d rather have something I know will happen now (+ve cah flow) than hope for something to probably (or possibly) happen in the future (capital gain). Manage to get both and it is a double bonus!
Later…..
Hot Rod
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