[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

December 15, 2015 - 7:45 am

Thanks for that Corey. I hadn’t really considered the tax implications or downstream issues that you have pointed out.

I’m going to take a leap and assume the OP’s issue is coming up with the money – ie, 2 people have more than one… what do you think the OP should do – wait it out? Keep studying until he has enough capital to go it alone?

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

December 14, 2015 - 6:12 pm

I’ve seen lots of successful partnerships in the UK (now I’m in Brisbane looking to partner and looking to invest). Generally they’ve been successful because each person is bringing something to the table the other wants or needs. For example, one person has money but no time or knowledge on finding deals… another example, a builder and investor… one has skills and the other has business acumen.

Understanding and confirming the intention of the partnership and the exit strategy are key.

Corey makes some good points but in my opinion problem partnerships are a result of poor up front planning and communication. Find the right person/ people, get your documentation squared away and go for it.

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

December 14, 2015 - 3:17 pm

Any plans for another one to run?

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

November 25, 2014 - 1:47 am

Walking to run,

One approach would be to look for a PPOR that you were both happy to live in and offered the opportunity to add value. This could kill two birds with one stone… 3 actually…

In your original post you mention “2. Rent a granny flat at the new property”. Finding a property that offered you the opportunity to build the granny flat (or an extension) would allow you to create equity that you could increase your borrowings against for new IP(s) as well as provide an income stream.

So you get your PPOR, an income stream to alleviate the cash flow burden & increased equity to borrow against.

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

November 23, 2014 - 11:09 pm

Hi Walking To Run,

It might be a un-creative but the easiest way is to not buy the PPOR.

Why do you want to own the next house that you live in? Real question. Is there something specific that you are looking for that you can’t get by renting? Perhaps you want to make the property just perfect to your tastes etc. If so, I completely get it.

The reason I ask the question is that in the past I have had the urge to put my money into a property for my partner and I but have decided against it. For us, it makes far more sense to rent a flat in an area that we want to live in and not be tied to the burden of the finance attached should we choose to buy it.

If we were to buy the flat we’re living in we’d be up for mortgage payments of around £2,500 / month. Renting, it costs us £1,300 and we deploy the surplus cash to savings for deposits on other CF+ properties.

Part of our strategy is to delay the purchase of our PPOR for another 5-10 years. For us this makes sense financially and we also enjoy the mobility and freedom it affords us. Yep, there are some downsides in renting but so far we’ve coped well with these.

Cheers

Mike

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

November 22, 2014 - 11:28 pm

Hi Richard,

Thanks for coming back to me.

I’m not disputing in any way that it can be done. Just very interested in how you structure the deals and finance for such purchases?

Perhaps you could give the breakdown at a very high level of how you would do this?

I’ll give you an example of my most recent project to give you an idea of what I’m Looking for.

Clapham Common 1 Bedroom Flat – Renovation
– On The Market Value £285k
– Purchase Price £265 (motivated seller, retiring and disposing of portfolio)
– Renovation Mortgage requiring 25% deposit, with immediate remortgage on completion of works
– Renovation Cost £25k
– Total Money in deal £106k
(25% Deposit £66k)
(Purchasing Costs £15k (ouch – I know!))
(Renovation £25k)
– New Valuation Post Renovation £365k
– Refinance @ 75% LTV (£273k Mortgage)
– Cash out clear £76K
– Cash left in the deal £30k

I’ve whipped through the numbers quickly off the top of my head. But essentially in 2 months I’ve created £60k of profit with a basic strategy of buying well, adding value and refinancing. Because the rents are so high in London this 1br flat creates £392 cashflow per month also. I can now recycle the majority of my initial deposit in another deal.

I’d like to do something similar to this in Australia :-)

Thanks

Mike

• This reply was modified 9 years, 5 months ago by  Mike. Reason: Formatting screwed up
• This reply was modified 9 years, 5 months ago by  Mike. Reason: More formatting

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

November 22, 2014 - 9:26 pm

Nice work Mitch. Starting is the hardest part. Good that you have your partner on board too. I’ve found a lot of people struggle unless everyone involved is pulling on the same rope.

Why is CF+ your main strategy? What’s led you to make this decision? That’s how I invest btw :-), although London capital growth has been very rewarding over the past 4 years or so.

Do you feel more comfortable with higher deposit?

It’s taken me a few years to get completely comfortable with using debt as a tool to achieve my property development/ investment objectives. If you’re able to articulate your plan including your goals, timeframe etc its a good idea to speak with a broker and map things out.

I have a team of people I work with scattered all over the country here in the UK but the thing all of them have in common is they understand my investing objectives and bring value to the table.

Keep being curious, keep asking questions and take action.

Cheers

Mike

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

November 22, 2014 - 9:16 pm

Hi Richard,

Would you mind elaborating on a client scenario that you mention in your post?

I’m an Aussie based in the UK and have a portfolio or properties in London but considering diversifying with some property back home.

Also, what do you consider to be rapid development. For me, starting out in London was difficult because of the high cost of entry into the market but I have found it’s very much a hockey-stick in terms of growth.

Thanks

Mike

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

August 28, 2014 - 10:07 pm

In the UK – Parmdeep Vedesha and Simon Zutshi. Seen stuff from both of them. I wouldnt give them my money but a lot of people do.

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

June 7, 2008 - 3:30 pm

I look forward to Steve's comments on this.  Go on Steve!

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

June 5, 2008 - 4:04 pm

Gumtree is owned by ebay and has a whole heap of useful stuff on there.  Its quite popular for Aussies, Kiwis and Saffas in the UK… actually its the first point of call.  Perhaps this is rubbing off on the Aussie market now.

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

June 5, 2008 - 4:02 pm

Hi,

I recommend you take a look at http://www.unlockthegame.com.  There is a lot of bs and hype (similar to this site) but there are some really good concepts. 

cheers
Mike

Mike
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[MikeParticipant@mikesonthemicJoin Date: 2008Post Count: 43]

May 31, 2008 - 9:53 am

Cheers Bryce, good insight.

Did you form relationships with your accountant and mortgage broker before returning home?

What city is home for you in Australia? Ultimately I will move back to Melbourne so if you have a good contact in Vic I would be interested to know.

Thanks again.

Mike
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