Hi Carolyn

There are a few things to say about that.

Firstly it depends on several variables such as your budget, your income (and as such how much you can afford to prop the costs of the property up for the first couple of years, or whether the rent has to do it all by itself), whether you expect growth and how much, your risk appetite (eg…[Read more]

Hi Chantal

Like anything, to succeed, you’ll need to fall into one of these categories :

– Very clever with business and/or the subject-matter in question

– Very passionate about the subject-matter… able to spend lots of time learning about it because you enjoy it

– Able to leverage the knowledge of someone else that falls into one of the…[Read more]

Why is the search scope limited to NSW?

At the end of the day, capital growth is an unknown entity. You can guestimate based on history, but nobody can guarantee what the growth will be. However the cashflow position of a property is an absolute known, because you know the mortgage interest, council rates, etc from day 1. So you know if a…[Read more]

Hi Tomo

This is a classic example of what happens when people try to sort out finance by themselves, think it is a good idea to “shop around” and consequently have lots of banks hitting their credit file. If you went to a broker, he/she would know which lender to go to, given your circumstances. This is because they write loans for other people…[Read more]

Be sure that you have a solid income stream that will be able to “service” the construction loan. There is little point in acquiring a property with a view to developing it if you have no way of getting a loan to make your plans come to fruition.

I agree with Jamie. A split system or other fixed heater option is too expensive considering you plan to knock the place down. If it were me, I’d either let them buy their own heater, or if they kicked up a fuss about how cold the room is, I might buy them a present of a heater. Being clear that if the heater breaks, you won’t buy them another…[Read more]

Remember not to sign anything without having your solicitor look over the contract first.

You might well be dealing with a lazy selling agent. Don’t sweat it, they probably won’t manage to sell the house, then the vendor will get jack of it and list with another agent. Keep an eye on it, it will probably appear as a new ad under another agent.

Like in any situation, there is such a thing as taking the mickey. As the brokers have mentioned above, it’s absolutely reasonable to have a quick chat at the start so that both parties can determine if the working relationship will be a good one, and for the client to understand if the broker can indeed assist them given their requirements.…[Read more]

$5k is a big increment to offer for no reason. There are a lot of circumstances and personalities at play here that you might not have enough knowledge about. Questions need to be asked to decipher what the next move should be.

Hi JJ

Sounds like you’re trying to buy something sight unseen? It’s a bit dicey to just pluck something off the internet. Best to be seeing it for yourself or having someone do so on your behalf. That way you will better understand the surrounding areas, whether there are any nasty smells in the house caused by things such as extensive mould,…[Read more]

I’ll have a go at explaining SMSFs in a manner that is relatively easy to understand:

There can be a couple of “companies” associated with a SMSF.

There is the SMSF itself (which is a super fund, not a company). It will have an ABN and a tax file number. Let’s say the Super Fund is called Smith Super Fund.

You may optionally have a Corporate…[Read more]

Hi Tom

It isn’t necessarily the case that the site would be worth more if you sold it with permits in place. You’d likely need to go the extra mile and construct the additional dwellings.

The LVR available to you from a lender will come into play in determining where you could “afford” to buy. For instance, if you were able to get an 80% loan (or less, eg 70%) then your budget will be capped at around the $400k mark, which will have a big influence on suburbs and dwelling types that are in play.

There would be a form you would have signed to nominate whether you want them to handle maintaining it, or maintaining it yourself. Politely remind them of this and indicate you look forward to seeing your reimbursement for the error on your next statement. If it doesn’t show up, go the appropriate small claims route through Consumer Affairs…[Read more]

Also chat to the agents about what type of properties are in most demand. No point buying a 3bedder if everyone is wanting 2bedders for instance.

True, though check with your insurer if your premiums will go up if you are self-managing. I would be surprised if they don’t. Also be aware you’ll have to spend petrol money driving to the property to do routine inspections, or any time something needs to be reviewed before deciding to send tradies to the property.

A lot of agencies do…[Read more]

Hi there,

Since your userid is “Melb Invester”, I am assuming the property is in Victoria.

When a fixed term lease expires, you can either ask them to sign a new fixed term lease, or allow it to lapse to a month-to-month basis.

One big problem is that you are not allowed to force them to sign a new fixed term lease. A tidy way of dealing with…[Read more]

Be sure to check on the insurance situation. Might be treated as a commercial venture.