We learn from history that we learn nothing from history.

Josh

Thanks Acey, I wanted to know what some of the main differences between apples and pears were as all I knew where they were…[Read more]

I don’t have too big a problem with the higher LVR as I was looking to go towards neutral gearing or positive cashflow since I believe that Cash is king.

The main thinkg I’m wondering about is that since rates and BC are higher is this in some way offset by lower maintenance costs (ie for gardens and aprtments tend to be…[Read more]

Have a look through E trade. My brother got my ticket there but I think it might have been cheaper and I got a free rich dad poor dad velvet edition book.

Josh

I think I’ll also look at comm prop as the way to go, all the people in the big money go commercial or develop.

Besides they generally have higher cashflow and less operating expenses…. Cash is King!

Josh

I’d check it out though.

Josh

Off the top of my head, the cheap +cf houses used to sell around 50k, now probably around 80 to 90 k rent I gguess is around 100pw. I honestly haven’t had too much of a look at the prices, rent and vacancies too much as I don’t tend to agree with investing in small towns with little potential.

I could probably try and find out the kind…[Read more]

Josh

It is highley reliant on the mines, power station and to a smaller extent teachers. A new mine recently opened so it might be alright. Teachers never stay long. Some live in bowen and just drive an hour to work every day.

The town has one hosp GP and one prive GP although tehy have difficulty…[Read more]

Josh

On a dollar for dollar basis renting beats owning a ppor.

Josh

Josh

JOsh

From what I have read, If you can find a tenent that will pay all outgoings (rates repairs etc), long lease, not currently owened by tenent, you might do OK.

As MJK One of the big risks is the vacancy period, Due to the higher costs large repayments may be required, AS long as you can cover this you would probably be OK.

As Mel…[Read more]

As with anything else higher risk is higher returns. Com prop is more volitile and can go down in value more so than res prop. If you lose a tenet you could be vancant for longer periods.

Josh

If you are worried about losing the money or servicing the loan I would tend to go for less IP’s with lower gearing ratios. As with anything the higher the reward the higher the risk.

Josh

With reagrds to the immigrants, I don’t think this is the main factor driving the prop market. (I read somewhere that most of them rent which may affect the vacancy rates and thus props but I thhink it is minor) At the moment it is the baby boomers who are driving this property market, and anything driven by this group of people will make…[Read more]

1) Yes, usually, You tend to find vacancies are for longer, (not really more but if you get one they can remain vacant for a lot longer.) Prices to fluctuate more and tend to run with the economic cycle.

2) The GST is the main one I…[Read more]

First off I believe both camps have both their pros and cons and I think a portfolio should probably have a combination of both.

However as far as the cashflow goes I generally am all for it. I think that they will generally have lower CG than the city centers over the long term. Like angie! says the cg may be there…[Read more]

Interesting comments on his thought about the fact that the economy is booming mainly on consumer debt and that it is going to end poorly.

I think that this is one of the things that the reserve bank is worried about so rates will probably go up.

Josh

PS thanks for the…[Read more]

Just a question thats kinda off topic, but have you ever thought off keeping the house (renting it out) and using the extra equity from the rehab to put down a deposit for the next one?

I don’t know if the numbers add up and if it will work but it’ll save all the transaction costs and you’ll build a portfolio.

Josh

I’m kinda along the same lines as mel. If you decide to invest of the equity of the reno later, it can be done but you then lose out on time. When compounding time is you’re best friend.

Not to burst your bubble or anything but a ppor is rarely an asset. As you mentioned yourself, If you aren’t going to sell, the only way to access…[Read more]

you would have to talk to an accountant to see if this was possible or not but you might consider buying an ip through a trust. theoretically the ipisn’t owned by you so that shouldn’t affect the rent allowance and also and income can be distributed between you and your wife that allows the best minimisation of the allowance.

I have…[Read more]

Josh

I understnad it has to do with the initial purpose of the loan, regardless of whether the use changes half way through.

I don’t know whether it is reciprocated for an ip becoming a ppor.

Josh

(i have no clue about this area but it was just something i thought of.)

Josh

I’m not sure whether moving from your current ppor to another ppor would make the ppor #1 loan a tax deductible loan even if you did rent it out. I believe that it has to do with the intent of the loan.

Best to check with an accountant but I heard that this was so.

Josh

I mean you’d get a better return on paying of the ppor loan as it isn’t tax deductible you are saving more. ppor loan has to be paid with after tax dollars so at the highest tax bracket you are saving kinda twice the interest rate. ie 14%, hard to beat.

If you find it hard to get pos cash props, pay down your ips to be…[Read more]

I thought having an offset account on an ip loan would be useful to have whilst saving for rates and repairs etc. (If you don’t have a ppor loan otherwise it would be better sitting there)

Josh

I bet he’s never heard of the all ords accumulation index.

Well I think the article proves I’m putting my money in the right place.

Josh

Anyone else heard this??

Josh

The only question is that finding them might not be easy.

Josh

With finding pos cash flow it will depend on how much cash you put in. ie If you bought an ip and paid it all in cash it would be cash flow pos from day one.

With the 11 sec rule the rent is roughly yielding 10%.

If you want to borrow all the money from the word go you basically…[Read more]

quote:you said:

quote:

The only downside with that is we have never saved a cent because we have been of the opinion it is better to get rid of debt. We have redrawn on the mortgage a number of times for renovations, o/s holidays etc as the redraw facility seemed like the best way to access large amounts of cash we needed.

I hope you were…

[Read more]

Generally prop should be a long term proposition but…..

Personally I might think about saving that lump of cash for a deposit on a pos cashflow ip, that way hopefully you may end up being close to…[Read more]

Generally prop should be a long term proposition but…..

Personally I might think about saving that lump of cash for a deposit on a pos cashflow ip, that way hopefully you may end up being close to…[Read more]

Generally prop should be a long term proposition but…..

Personally I might think about saving that lump of cash for a deposit on a pos cashflow ip, that way hopefully you may end up being close to…[Read more]

I dont think rugby has an investment loan yet??? am i right rugbyfan?

Josh

when you take the money out of the ppor #1 and into an ing account for 8 months what benifits does this have?

Why not take it out when you need it for the ppor #2.

If you redraw against ppor #1 for investment that loan is tax deductible but the rest (remaining on the house) isn’t.

I hope…[Read more]

Josh

I know townsville had a large student population but I thought it mas mainly an army town.

Josh

buying a ppor does provide a sense of security, and with your numbers they do look alright, The main thing is once you’ve paid it off whether you’re happy with it or will then decide to upgrade to a bigger house and a bigger morgatge.

If you can resist that (and the put more money doing expensive reno on the house) you’ll probably come…[Read more]

I’ll agree with flexability and reviewing your plan every so often. I think for property this is probably the best option, however for the stockmarket a more rigid plan is needed. Changes should only be made with future buys, preferably with no money in the market as this may cloud your view. Fortunatly with property a slower choice…[Read more]

JOsh

A trading plan is essential for the stockmarket, what about the property market?

Josh

Personally I’m waiting a bit and trying to save a bit more. However now is the best time to learn about property as there are plenty of people out there who are interested in…[Read more]

Josh