Sooshie,

Re the fresh meat comment.

I’ve never suspected Steve was a con.
But I must say I did become mildly Cynical with this Today Tonight Business and the frenzie the book has created.
Unfortunately I can be a bit sarcastic.

MJK

Doug,

I have no idea they just sent it to me. Like I said I’ve been with them a long time and have no personal debt. I suspect it has more to do with how much you borrow and having a good track record of making repayments. I wouldn’t say its anything to aspire to but I thought I would mention it so people could see where I was comming from.

PS.…[Read more]

Chastised I suppose, but it took a while !

In my defence I was refering to the flood of “newbies” all hitting at once rather than the occasional.

I sincerly hope all you newbies suceed.And those that became a little overly upset the same.
I suppose being honest, even in the soap box section, is not worth it.

Mind you I’ve done my bit to answer…[Read more]

Roxy,

I personally find using a buyers agent the only way to go when investing interstate. I used a realestate agent that acted as a buyers agent for me by showing me property that wasn’t listed with her organisation. Also I used a reputable buyers agent to help me buy a commercial property.
The point I would make is that you need to be actively…[Read more]

Simon,

I like the St George PL. I use it myself.I like it because you can have money preapproved and in your account undrawn ( ready to use ) typical line of credit I suppose. They give me 5.97% interest on my primary account & sub accounts. I like to use the available funds to fund a 20% deposit and chase 80% stand alone funds elsewhere. I am a…[Read more]

Thanks Mort Man,

I was going to make this point myself but thought I’d said enough. Over extension is the real issue, lesser so the market.I agree with you.

MJK

Polar Bear,

” Voila , you have your bust ”

I think your confusing property with shares.

The last propery crash was caused by 17% interest rates. Now thats doom and gloom!

MJK

Some people will believe anything wont they ?

The world is a different place today. I think the past is usefull but not always a garantee of the future. If anything our high dollar may see a slowdown in Australia now, and ease pressure for rate increases. Were talking property soft landing not property crash in my opinion.
These people waiting…[Read more]

Maximillion,

If you have a property earning 10% and costing 8% ( 6.5 in interest and 1.5% in costs ) you can afford a 2% rise in interest rates before it goes nuetral ( which is not yet negative ) The point to consider is is it worth holding nuetral property in rural areas ?????
Now if you can find a 20% return then great. I cant!
So if you do…[Read more]

My target was 45 but I’m considering 42 now.
My current age is 38.

” Aim for the stars, if you miss you will land on the moon. ”

MJK

Polar Bear,

I bet your glad you bought when you did. My experience is the same but my investments are all within 3-17 klm of CBDs. Personally I’m not comfortable with rural property. Major towns like Ballarat, Toowoomba, etc… would be OK but small towns are to risky for me.

MJK

Rents also move when housing affordability decreases. The driver for this will be higher interest rates but the downside is that for an invester higher interest rates reduces the net return. High interest rate periods are the make or break for many investors.

MJK

Dino,

Rents move when demand supply ratios change.

MJK

Dino,

You are right. People who bought say 4 years ago have reasonable if not excellent rental retuns which cannot be duplicated in the same area, in the short term at least. Thats why the pos cash flow brigade is going rural.
Timing in property cycles is very important. Many seasoned investers have been in the game a long time and have seen at…[Read more]

Pin,

I typed up a long winded reply yesterday and something funny happened to my computor so I lost it.
The first example you gave is not “negative gearing” but rather “positive gearing”

Positive gearing = costs exceed income before tax but not after tax.

So yes you CAN make money from positive gearing but not negative gearing.( excluding…[Read more]

Negative gearing cant save you money.

Positive gearing can.

I’d like to see an example where negative gearing can save you money.

The only money to be made from negative gearing is capital gain.

MJK

” Isn’t it called the bigger fool system ?”

MJK

It is truly amazing how many people dont want to move to a higer tax bracket because they THINK they will be worse off. I’ve given up trying to help peolple understand if they have this idea firmly implanted.

MJK

Sue,

I know what you mean. My point is that if you get non cost tax deductions ( ie div 40 & 43 )and are on a high tax bracket, going negative is not so scary. I do worry about these people investing in the bush for cashflow though. If I were them I’d be locking rates in for 5 + years.
Gone are the days of buying +ve cashflow in blue chip areas,…[Read more]

Sue,

The point is if you are buying for positive cash flow in rural areas, often you are buying low quality, low capital gain property with no depreciation benifit. Most people that accept neg gearing as a strategy are after long term capital gain and tax benifits to cushen the neg cash flow.
A negative geared country property is not a pretty…[Read more]