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Hi,
Another tip to check out whether the rental market is good in an area is to check out the vacancy rates of a suburb.
You can find this out by talking to local real estate agents/ property managers, OR I think SQM research has an online website which gives out free vacancy rates for suburbs.
Good luck!
Hello!
If you have any questions or any property stories, you're welcome to share them, and the community will try and help you out
Yep, Happy Australia Day long weekend everyone – The Year is getting along, and the first month is almost done.
All the best in your property goals and achieving them in 2014!!!
For a) I would go for about 3% per annum, using 3% as the average. But if you want more detailed inflation averages, you could look at historical interest rates in Australia, e.g. in last 20 years, and use the average of that as your figure.
Hey Kate. I think Warren Buffett's quote is a good overall philosophy – and your timing certainly is a factor.
Though For me personally, if the numbers still add up for a certain deal, and the projected return on investment is still worthwhile, then I would go ahead.
BUT if market conditions are making it so that greed in the market is making it difficult to get a satisfactory ROI, then I would wait.
I agree. Thanks for such a great resource! A really great place to start for crunching the numbers for IP loan repayments.
Freckle's spreadsheet is a good resource.
For me personally, I like to use the online NAB home loan calculator.
If you're making a more sophisticated calculation, then making your own customised calculator from a spreadsheet would be a good idea – or at least check out Freckle's spreadsheet, and then edit it according to your personal needs.
If you're really keen on buying interstate, and not visiting it, you could do other forms of due diligence such as ordering building inspection reports and pest inspection reports from contractors in the area.
You could also get other kinds of more thorough inspections for plumbing and electric. For the reports, you could get them to mail it to you or email it to you.
Don't just rely on the comments made by the seller or real estate agent.
Getting your own buyers agent, especially an agent who actually lives around the property, could be another option.
I'd keep an eye on both as well. But if you really are keen to just focus on one area, I'd suggest to consider returns and growth but also think about the geographical convenience to you. Which one is easier for you to visit just in case you want to regularly visit your investment property e.g. for initial inspection and then later ongoing maintenance and future renos
For me personally, I would do: b) Buy the property with a 20% deposit, and ignore the rest of the cash. I would want to be in debt to my friends as little as possible, just in case anything stuffs up.
To help you out, you could also check out some of the demographic info and comparative house prices of those western suburbs. You could use free research from the resdex website and the sqm website.
I don't tink mining towns are all that bad, in my opinion. The criticism seems to be that mines can shut down quickly and leave your property rental income in the dust. That's true, and to avoid that potential risk, I'd suggest to find mining towns that have other industries that are significant in the town. Also check that the regular population is large enough so that if the temporary mining worker population leaves, you will still have demand for your rentals.
I'd also look into investing in the US, since you're in North America already. There are alot more resources (especially for Australians) for investing in the USA.However, I'd also compare the potential returns and the convenience for you between US and Canadian investing.
If you want to achieve the goal of '$150K plus net passive income', figure out the monthly net income that you need. Then from there, allocate your 1.0million to buy enough positive cashflow properties that progressively get you closer to your target monthly net income. That's what I'd do. Start with the goal in mind, then work backwards.
I'd keep the $7 for a deposit instead. You can get the same information from those high priced seminars from cheap books or from free forums like this!
There are some really expensive seminars in the thousands of dollars. Many of the free ones also tend to go through alot of fluff and not the specific details. That's what I found when I started and wnated to learn more. I found actually that reading books was much more informative, and not to mention cheaper!
If I were you, I'd buy the house and land. The value of land goes up much faster than buildngs. My first investment property included both house and land.
With that personal loan of $24k, you're probably best to pay that off as soon as possible. Is it bad debt? or did you get that personal loan so that you could buy property with the 24k?
I think option 1 would be the best. I am cautious about mining towns. Too risky and I am a very careful person. Option 3: you need to check potential renters in that area. If well off people live there, it is a possibility you cheap one bedroom might sit unrented.
Reply after 2 years? Is not it too late? I see a bad customer service here… I am sure your client have already found a new coach.
