[hwd007Member@hwd007Join Date: 2002Post Count: 247]

January 9, 2004 - 5:05 am

The thing that concerns me about these cheap properties is the quality of tenants you will attract and any hassles that may accompany that approach, compared to buying more expensive IPs and attracting more “quality tenants” I mean it should not be that way and Im not sure if it is but it does concern me a bit. As the saying goes you get what you pay for. This is a more generalised hypothesis and not always applicable but I cant help but wonder if people who buy cheap properties have many more tenant hassles. i.e. those with less money generally have lower standards of living and social problems etc… I know they say that wealthy people have the same sorts of problems so I guess Im just trying to get a feel for what others think about this aspect. I mean you are surely catering for a different market demographic.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

January 9, 2004 - 4:42 am

i think if you factor in fixed rates to you positive cash flow analysis, you should be safer.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

January 5, 2004 - 5:36 pm

Elysium-M Many thanks.

Well I am with a new agent now, so I am just waiting to see if the tenants pay the full rent plus the $93 in arrears on time, this month. If they play the game right, I will be happy to put it down as experience and review at years end. I would prefer to aviod the red tape if possible. I think I have been sold a lemon on this, but I will just have to see how it goes from here.

Yes got the Landlords Insurance, but I hope I don’t have to spend my time bothering with it.

cheers

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

January 4, 2004 - 6:09 pm

I doubt I will ever use Stockdale & Leggo’s Malvern Office again under their current Franchise ownership. I would not recommend them to anyone.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

December 30, 2003 - 4:50 am

The previous agent recommended the tenants who were reportedly the agents friends. This agent arranged it all but appears to have left me with dud tenants. I am begining to think and also they lowered the rent from what I was asking initially to favour their friends. Basically feel I have been taken for a ride with these agents. Thats the long and short of it. Yes I did complain and bring this to the attention of their Head Office who basically agreed with me. Becuase it is a franchise operation their Head Office power seems a little limited. Upon hearing about my complaint, the previous agent then relinquished management of the property which was the right thing to do at least.

But they have stuffed me around, cost me cash and left me with seemingly dubious tenants, of whom they gave glowing reports. I would have said they had a potential conflict of interest in that they seem to have held the interests of their tenant friends, above that of me, being landlord, whom I understand hey are supposed to be representing. Thus I have already had issues with noise complaints and non full payment withn the first month of tenancy. Anyway thats my lot and I will deal with it. We will get there in the end. You live and learn.

Hmm I’m now with a new property manager who seems better than the previous two agents, however the seemingly dud tenants have paid the rent but were short by $93. Now my new property manager has to chase this up as I understand, they have had no explanation as to why they short paid the rent.

So much for the glowing reports from the previous property manager who indicated they knew the tenants and that they had excellent references.

Gut feelings carry much weight and I wish I had gone with them when I first spoke to the previous agent. i.e. the feeling was troubled waters.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

December 11, 2003 - 3:35 pm

I have been paid for the first month, but I am not optimistic about that either given the goings on.

To make matters worse, I have just found out from the first agent that the body corporate is trying to contact me, about noise complaints made about the tenants that moved in, who this second agent recommended with glowing praise about their references.

i.e. the ones that are allegedly friends with one of the property managers at the second estate agents, currently managing my property.

I mean what next ! I am already under the hammer financially due to the stuffing around by the first agent and now I fear more problems from the second agent, who knocked the rent down for the tenants of their choice and leave me with troublesome tenants at their recommendation in less than 30 days.

The first agent freely admitting that some how he always seems to be the bearer of bad news to me and then has the cheek to suggest that if I am looking for a property manager, he would be available. I mean like yea right !!! like cost me $1500 interest due to ill advice on the appropriate asking rent, plus $400 advertising costs and then offer to pick up any crumbs of my misfortune. Way to go dude !

Sorry people, but I just have to have a whinge to someone.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

December 8, 2003 - 4:04 am

Well you know it aint real spun gold and well those pantyhose, they still get ladders. I’m guesing here

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

December 5, 2003 - 4:43 pm

Thanks for all views. In regard to the Landlord being paid pittance view. With the utmost respect for your right to express a view, I don’t accept this at all.

There are certain obligations and expectations I believe exist between landlord, agent and tenant. This is outlined in the Residential Tenancy Act. This act has been formulated over many years of consideration of legal judgement over many issues that come before the courts, in relation to such matters and is designed to protect the fair and reasonable interests of all parties concerned.

If we cant rely on the acts of parliament as a guide to code of ethics, then we are all doomed to a stressful life of law of the jungle free for all, kill or be killed. We may as well all go and live in IRAQ.

If any party is not willing to respect such laws, then they should not be in the business. Why have traffic lights ? To protect us all from the madness of jungle riddled fever of the road.

So more to the point, if one is not willing to accept ones responsibility and obligations, then don’t take on the job and make life miserable for others in the process.

By the way they are actually only getting 5.5% on $280 a week. But in my view, that’s not the point.

Anyway I have spoken to the Head Office people and they agreed it was taking a bit too long to get the inspection report to me, given that I had requested a copy of it. I guess the agent wont like the fact that I complained to Head Office, but I could see I was getting nowhere fast.

I think I’m getting less patient in my older age. or starting to see the Bull Sh_t allot sooner Having said that I have a good agent in Brisbane I am pleased to say, who makes this guy look like an amateur. I guess it has set a standard for me and I don’t want to accept less than that.

I already dumped another agent who took way too long to rent the place out because he was advertising at a rent that the market was not near. i.e. $325 per week when it was more like a $290 a week market.

Thus I went with this current one who seems slack and careless, but got it rented out. I had that gut feeling on the phone to him not to trust him, but I was so desperate to get a tenant, I felt I had to take a chance or risk going under financially.

Oddly after 8 weeks of stuffing around with the first agent without him once suggesting to lower the rent, the day I signed the contracts with the slack agent, the first agent comes up with an application for $280 a week also. He missed it by hours. I think when I told him I had something lined up elsewhere he may have decided it was time to pull out his finger and try to get it rented. This guy was even smoother than the current one. He could do radio adds for “Spun Gold” butter or “Smooth as Silk” pantyhose

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

December 5, 2003 - 3:56 am

I have both lease / management agreement and tenancy agreement. I will go over them tonight. The franchisee I presume is the one I am dealing with but it seems to make no difference, I still seem to be treated with disregard. I mean it seems unfair that I have to bust my gut, just to ensure they meet their minimum obligations, but I will do so if I have to. I have spoken to them face to face but, well you just know when they don’t seem to really care. You can just tell. You know what I mean. Its in the attitude, and the actions or seemingly lack there of in this case.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

September 11, 2003 - 5:23 pm

yea thanx I am thinking of locking in as I know at least I can afford it even though its a bit tight. I will be about $6.5K out of pocket per year on it.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

September 10, 2003 - 5:07 am

tax shelters
good for the long term
keep your wife or husband from them when you get a divorce

[]

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

September 9, 2003 - 4:08 pm

I have bought $870K of property in less than 6 months, First one settled 22 May third one should settle 23 Oct. I had about $140K equity to start with. The first one jumped 60K in value in 5 months. The second one 20K. So now im getting the third.

I just need one more positive cash flow one worth under $200K to balance my 3 negative ones and I will controll over 1 million in under 12 months, excluding my PPOR and allowing for capital growth.

I had a lucky run though.
cheers.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

September 9, 2003 - 3:29 pm

i think he would go for charity as its tax deductible ! hehe

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

August 30, 2003 - 3:15 pm

This applies to high rise only !

It’s a 4.97% return. But I would probably stay clear of it. Also the return can be missleading and you would want to know exactly what formula they are using to calculate this and whether they have excluded other critical costs such as body corps and management fees etc…

The problem is when the 5 years is up what will it really rent for ? what will be the capital growth on that type of dwelling ? If you have no idea then be cautious.

My advice is go for quality property with no rent guarentee, but just take a lower rent if that bothers you to secure a quick tenancy. You may be out of pocket in the short term, but you have comfort in the knowledge that you bought a good property that will offer good returns in time.

As a rule I stay away from high rise apartments. its dead money and hard to get good rent. Did you know they jack up the price so they can afford to offer you the rental guarentee ? what you think they are stupid. The developer never looses. they know more tricks than most of us. Have you not been following the new reports ? high rise apartments have crashed my friend ! they have lost value !

stay clear of it. go for normal flats and houses within 10k if brisbane cbd. thats it !

Bread and Butter Investment kid ! hard to loose in the long run.

good luck !

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

August 30, 2003 - 3:01 pm

If your a serious investor Tassie is a waste of time, if you believe in the Bureau of stats projections of population growth. It’s population is aging faster than the rest of the country. Its dead money as far as I’m concerned.

The I think speculators have pushed up Tassie prices, but I recon Tassie will be the first to crash when things go pear shape in the Aussie economy. The fundamentals just aint there.

Why invest at 5% CG when you can get 10%+ in Queensland ? You can always buy back into Tassie at a discount if you want to retire there, had you invested in QLD instead.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

August 30, 2003 - 2:49 pm

take out landlords insurance. it can cover about 6 weeks if your tenant leaves and also covers willfull damage up to a certain amount 30K to 50K

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

August 9, 2003 - 12:49 pm

Thanks Michael
Its a Queensland purchase.

Dale thinks at least the following can be deducted over 5 years.

3. Registration Chanrges Account $ 315.00
4. Stamping Chanrges Account $ 932.40
8. Office Of State Revenue $ 955.85

The others, particularly item 6 we were uncertain about.

On another note, if I am charged panaly interest by the vendor selling the property, due to my bank and solicitor not getting their act together and settling on time, is this pentaly interst deductible over the 5 years or do we add that to the coast base for deduction upon sale ? thanx.

I have a feeling item 6 may be the solicitors for the developer, as I have seen the same amount on two seperate proeprty deals I have done with them.

I read on the ATO rental properties guide that if you obtained the loan part way through the income year, the deduction through the first part of the income year will be apportioned, according to the number of days remaining in that income year, that you had the loan. Thus deduction = ( no of loan days / 365 * expense )

Mike I have learnt one thing over the last week. A property investor needs an accountant who owns investment property.

My experience will lie some testimony to this and the fact that these items were not prompted to me by my accountant. Rather I had to suggest to him that these items may be deductible.

I was assured by the firm that this guy was good as the property accountant was booked out and for the large part he seems ok, but its just not the same if your accountant is not in the IP business himself. He told me that he could ask the other property accountants for help, but its just ain’t the same if you don’t know what to ask in the first place and the others are busy anyway, to busy to be bothered with a small fish I’m sure.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

August 8, 2003 - 4:36 pm

Personally I think there is a correlation, but the question is to what degree. Try to rent in a good area against a bad area and you will find the property values in the good area are more, as is the rent.

I admit this says nothing about growth, as it is only a snap shot in time. But, the correlation between good areas or high in demand areas should surely relate both to rent and property values.

As measured over time surely high in demand areas would exhibit strong growth both for property values and thus rentals.

I mean look at it this way;

1. high demand area => low vacancy rate => upward pressure on rentals

2. high demand area => low for sale rate ( i.e. more people wanting to live there than want to sell supply Vs demand ) => upward pressure property values.

The lag may be reflected by rental contracts of 6 to 12 months. Thus one would have to typically have to wait for a full 12 month cycle to see the rental prices begin to reflect the capital growth from the previous year.

I can see the logic of everyone want to buy and thus nobody wants to rent also, but applied at a more macro level. However on a more local or micro level perhaps less so.

In any event, even applying the macro logic to the micro or by suburb level, the reality is that even if everyone wants to buy, many of those that want to buy, want to buy so they can rent out the property on the logic that they believe they will get strong rental returns in a high demand area.

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

August 8, 2003 - 5:58 am

look before you leap

[hwd007Member@hwd007Join Date: 2002Post Count: 247]

August 8, 2003 - 5:54 am

its anyones guess. depends on your situation.dammed if you do, dammed if you dont sort of thing.

All I can say is that over the last 10 years I’m told that varaible rates on average did better than fixed.