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I signed up for 10 years fixed, at 8% in 2000 and have regretted it ever since, but if rates had gone up instead of down, I would be as happy as a pig in s#*t,
the penalties are far too high if you need to break out,
a lot of things change in 15 years.Good Points;
%return is usually higher
usually less complaints from tenants
tenants usually look after the property better, as their place of businessBad points
Most lenders only lend 65%of value on commercial + industrial
and you may have trouble getting cheaper residential loans with commercial mortgages.
if things go bad, you can always drop the rent 10 or 20 dollars to get another tenant, but that same amount of drop in commercial, makes no difference.
people have to live somewhere, they don’t have to have a business.Bought my first property in 1975 for $ 18,000, all the neighbours thought I was paying too much as prices had just gone up from $ 14,000, I sold this property in 2001 for
$ 638,000 and every one told the buyer he was mad and paid too much, other properties close by have now sold for
$ 730,000.
These prices have been the norn in many European countries for years and still going up, it will never stop.GOOD NEWS
Just got e mail from WBC manager, that after long and hard negotiation by him, the bank has agreed to my requests.
Looks like I’ll probably have to have to do the same thing with them every time from now on.
Thanks for all the replys and offers to help.
The latest in my saga.
Had a visit today from my bank manager, giving me all sorts of excuses, why they can’t do this and can’t do that.
I finally found my balls and told him I didn’t really care what they could and could not do, this is what I want and if I don’t get it I’m leaving.He tried to give me a lot of other excuses, but I cut him off, told him I was busy and showed him the door.
He said he would do his best, I said good !!!
and off he went, in shock it seemed.The developers here say it costs them around $ 22,000 per house allotment, so for rural it would be cheaper.
Don’t forget the interest on borrowings, untill you have sold enough blocks, and then taxes.
I’ve got some rough indications on the costs of subdividing, in my area.
Roads $30/m2
Kerbing + Channelling $35/metre
Water $70/metre
Storm Water $2000/block
Electricity $800/block
Sewerage $40/metre
PLUS Council Fees + Charges + Contributions, Surveyers, Engineers etc. etc.A vacant block has no income, only expenses.
Shouldn’t you be trying to get an income.
Income will help you buy more property.
I’ve been with WBC for 5 years.
As soon as they start telling me that they can’t make a decision and have to submit it to someone else, it’s time to leave.When there is an oversupply of rentals, units are always first to become vacant, you will very rarely have a tenant leave a house for a unit, but most are keen to leave a unit if they can get a house.
Returns are sometimes better on units, but the higher the return, the higher the risk.
Times aren’t always going to be good, so houses will always be better in the long run.Try http://www.smartpropertydevelopment.com.au
I’m not sure if it will help, but it can’t hurt.Put an ad in the paper, asking for expressions of interest in blocks in your new subdivision, with written replies only.
This will give you a good indication of the level of demand for your size blocks, and when you have a good number of replies, you can take it to the bank, as proof of demand and you should have no trouble getting the funds, without having too many partners.Banks usually only lend 50 to 60% on commercial
The returns are usually higher from comm
The vacancies are usually longer in commI would start with residential
I have all three, res, comm and rural, and res has always been the best.Fortunately I have been financially free for about 9 years now, but I am still at the same old job, because I now enjoy it, because I don’t have to do it, it puts a whole new light on it, sort of like an income producing hobby.
Not only do Units sell better than as flats, but they rent better as well, it’s all in peoples minds.
A duplex is 2 units side by side, just as a Triplex is 3 single units side by side, but people feel more important if they rent a duplex, rather than just a unit.Thanks everyone.
Rents are good here, I don’t think finance is a problem as I can sell some to build more.
What I am worried about is having so many properties owned by the same person in the same street (ME), one landlord for the whole street.I don’t know if I would do all 14 at once.
It would be just like me owning 14 units in a complex, are there any problems with that.
I am in Cairns North Queensland.you have to get it valued properly as it is an in family transfer, and it’s better to have it valued high, than low.
it’s better to pay a bit more stamp duty, than to pay a big heap of capital gain when that family member sells it.I thought I would get it valued at the total I would get for selling the blocks, eg; $500,000 and pay stamp duty on that, which is a lot less than the tax would be.
the unimproved value should be on the rate notice, that’s usually what the council uses to work out the basic rates plus services.
The improved market helped me sell 3 in the last 12 months, but I actually semi retired in 1995, and full retired now.
I still feel I’m paying too much tax, so I’ll buy more property soon.
