We have been discussing this very issue over recent days in other threads.
I am living in L.A at present, we are renting our PPoR, and intend to do so for a few more years yet, so I am in this position exactly at the moment.
I placed a call to my accountant last night to get clarification, and both TerryW and I posted an answer, but I’m happy to…[Read more]

Hi Elka,
J.B’s book is an A-Z of how to get out of debt, how to maximise your standard of living on your present income, and free up more cash for investing, and finally a section at the end about investing; but not a great deal of ‘nuts and bolts’ on that.
It also goes into the mindset of the wealthy; what they think about, how they manage money…[Read more]

I have got the book, have read it 3 times.
Great book – every high school student should have to read it as part of their curriculum in my opinion (and a lot of adults as well).
I don’t own any mutual funds – I love property (have a few shares that I sourced my self).

Cheers,
Marc.
erardent@hotmail.com

“we get sent lemons; it’s up to us to…[Read more]

agree entirely B.B
No one ever went broke making a profit.
Pos cashflow will eventually allow you to become financially free.
Cap growth will too – when you sell, but you’ve gotta be able to service the debt in the meantime; you are chained to your I.P.

Cheers,
Marc.
erardent@hotmail.com

“we get sent lemons; it’s up to us to make lemonade”

Straight pos cashflow properties are about as common as an honest politician these days.

However, you can buy a ‘standard’ purchase property that is pos cashflow after tax if you look hard enough.

But you need a few important factors for it to happen –
1. A high tax bracket income helps, but is not essential.
2. The rent return would have to be…[Read more]

I am not sure, but I think that unless there is an income from an investment you can’t make a claim for a tax deduction. This is probably why there are no tax deductions on vacant land that has no income I suspect.

If you were to buy an I.P that produced an income in the same financial year as the literature that you bought, then I think you can…[Read more]

Thanks Terry,
I just got off the phone to my accountant tonight (my time in L.A) and saw your post.
He confirmed that if you rent your PPoR out, after 6 years of renting you will pay cgt on the period you rent your house for.
There is no cgt payable if you rent it out for less than 6 years.

Cheers,
Marc.
erardent@hotmail.com

“we get sent lemons;…[Read more]

Hi Andrea, welcome to the forum.

You can buy an I.P without a cash deposit. You can use equity in your PPoR as the deposit, but it is still a loan.
Doing it this way means you are using 100% finance to pay for the I.P (actually it is more if you use the equity to also fund the purchase costs).

The plus is that you don’t need any cash to start…[Read more]

It’s a bit hard to compare apples with apples when talking of landscaping – different plants, different sizes, how many, the design, how much paving, retaining walls, lights etc, etc.

If you are handy and have the time, you could do it yourself and can make it look great. Something really elaborate may require the pros.

As for rendering; I had a…[Read more]

Which ever market you look at, focus on it and become very knowledgeable in it. You want to know what every single property is worth in your target area.

As a first I.P, Commercial Property may be a little more risky, as there are more factors to consider than a Residential Property.lack of experience increases risk.

After all; people have to…[Read more]

Originally posted by kpi:
Hi Peachy,

As an ex estate agent I know from experience that some vendors get very nervous about accepting an offer with no money down. I am in Victoria and $500 was usually enough, however, the initial deposit has no advantage to the estate agent, so try and listen to what the agents advice may be as they will know…[Read more]

I suspect a lot of the recent interest rate rises have stopped the ‘pay check to pay check’ brigade from going mad at xmas. Another interest rate rise, petrol rise and an increase in the tax on smokes and grog will make things interesting.

Cheers,
Marc.
erardent@hotmail.com

“we get sent lemons; it’s up to us to make lemonade”

Not sure; I thought I heard (read) it on this forum, but I may have been horribly drunk as usual and didn’t know where I was.
But I did hear it somewhere and it stuck in my head.
I was like you bb – I thought the rental period cap growth was pro-rata.
It is a factor for us as we are renting our PPoR at the moment and intend to do so for a while…[Read more]

Fair point, but we were fixing bouncing floorboards. No load bearing problems involved that I can see.
As I said in my post; we went overboard to make sure it was done well.
8 years later; still all clear.

Cheers,
Marc.
erardent@hotmail.com

“we get sent lemons; it’s up to us to make lemonade”

Residex have lots of different reports on projected rents etc, but they cost. No free lunch I’m afraid.
The other place that might help is Property Investor magazine. They have updates on each state.

The other method is as bridgebuff said – get on the phone and ring the agents in the area you are interested in and ask them what the rents are for…[Read more]

Is the property managed? If so, the agent should know the procedure to get them out.
If it isn’t managed, get a good one fast and let them handle it. They will issue a breach notice and if this isn’t honoured they can apply to the Tribunal in your State.

Usually, an official piece of correspondance like this gets them into action, but you have to…[Read more]

Can you tell us why your 2 properties are/will be doing well in McAllen? Is it because of growth, or cashflow, or both?

I noticed tha median house price is very low. Is it a small town?

The only problem I have with hearing about a great place to live via the Media, is it has either already boomed and we have missed the boat, or it is about to be…[Read more]

sorry waynelad, can’t agree; agents are never working for the seller – they’re working for their hip pocket.

Cheers,
Marc.
erardent@hotmail.com

“we get sent lemons; it’s up to us to make lemonade”

I am from Melb and live on the Mornington Peninsula (not at the moment) so I guess I can have a crack at the answer for you.

1. South of Parkdale is historically the holiday areas, a hundred years ago.
All the architecture and infrastructure was basic and the access to the City was limited due to only one main road – Nepean Highway. The prices…[Read more]

I just did a very quick number crunch, based on dividing the yearly rent by the purchase price and purchase costs, then multiply by 100 = 7.49% rent return. Considering that the cost of finance is 7.5%, this isn’t that great.

I then did a slightly more in-depth, but still basic cashflow projection:-

Assuming you have to pay $120k + GST…[Read more]