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March 25, 2004 - 7:04 am

Put it all on black 22

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March 15, 2004 - 12:22 pm

haha – new curtains meaning a rent rise of $100 p/w

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March 15, 2004 - 12:07 pm

I was just passing though and thought I might give you a couple of things to think about.

3) The point of having 4 houses instead of one big one as you used as an example is that it minimizes your chances of losing. Say for example you had a vacancy rate of 5% for your sort of houses. With one house your chance of having NO income is 5%. But with 4 small houses, assuming same total cashflow overall, you have .05*.05*.05*.05 (0.000625%) chance of having NO income. Also another thing to think about is you’d expect maintenance on 50k properties to be a lot smaller than that on a 200k property, so at least you’re not hit with a big bill all at once [:0].

4) I know some people do end up in trouble with interest rate rises, but one thing to consider at least is that rents will rise with interest rates, due to supply/demand – ie. rates rise, so less people buy properties, so therefore they rent instead, meaning an increase in the rental demand, so rental prices go up.

Also I think I remember in Steve’s book, that in his calculations he always budgeted for a little expence called “maintenance and repairs”.
Anyway, buying houses for the $15-20/wk cashflow isn’t the strategy i’m going to use. I’m going to take the approach of creating value in houses, and then buying a big cashflow asset (not necessary property)

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March 12, 2004 - 5:31 am

Well you guys are looking the wrong way – Gold Coast and Brissie are the way to go

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March 5, 2004 - 8:22 am

Yeah that’s what he suggested in the book – you would probably not be able to get as many houses if u were after a share of the comission. But you’d get more money for each house, so it’s a sort of a trade-off.

It’s all just food for thought though.

“I’ve made every mistake in business, but i’ve only made them once”
– Dick Smith

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March 5, 2004 - 8:10 am

I’d highly recommend the book Building Wealth by Russ Whitney – i’m currently reading it atm and it’s got some really cool ideas in it. I just hope they work here in Aus as they did for him in the US.

I wouldn’t get disheartened by the downpayments on properties or how you need morgage insurance if your loan is too big – there’s no harm in making offers on properties now and asking for vendor’s fianance. You’ve got nothing to lose and only experience and maybe some sweet deals to gain []

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February 26, 2004 - 1:49 am

Sorry Pisces – don’t like what you said about needing a deposit (look at the nothing down posts in this forum), and when you used the word “job” – you just need some sorta income.

Anyway PenguinJr, you’re going to have a hard time just scouring the internet like all the other hopefuls looking for positive cashflow properties. That doesn’t sound like a good situation because you’re doing all the work – how about having the properties come to you? – ie. advertise to real estate offices, friends, in the newspaper, etc. that you’re an investor looking to buy properties of some description and you’ll consider any offers.

By the way, I hope you’re not restricting yourself to under 200k because you think that you don’t have the money for a deposit for a more expensive property. If you were to be creative with ideas like vendor fianancing, going into a deal with another investor, etc., you could open your options to a bigger market of properties for sale as you could afford more expensive properties.

Anyways, good luck.

Nothing is impossible, just implausible

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December 18, 2003 - 10:12 am

Sorry, a bit off the topic but

“Being highly geared can be uncomfortable. It’s probably better to be <70 LVR to save the worry.”

– Wouldn’t it be better to be more leveraged because then you could use the extra money to buy more properties and reduce your risk that way? You’d also get the benefit of having another appreciating asset

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December 18, 2003 - 10:02 am

Yeah, a friend of mine recently bought a property for his business with the clause “subject to his own due dilligence”

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December 15, 2003 - 2:46 pm

Hey I’m also a uni student and facing the same dillema of no cash nor decent income to start[]

If you know who Dolf De Roos is, well he aparently got the money to start investing via a student loan, since he’s never had a job. But from what i’ve read of student loans from the major institutions, they don’t loan for investment purposes. So beats me how people in our situation could get started.

I’m all for the networking idea of us uni students – maybe we could get together and see about pooling together to get an investment property? If you’re interested in the idea my email is [email protected]

Mark

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November 9, 2003 - 12:49 pm

I don’t see anything wrong with auctions either. If you’re a shrewd investor and not swayed by the hysteria of auctions, they can’t be bad for you. If anything, auctions would show how much people would be willing to pay for the house – bad if it does get sold, but if it doesn’t – wouldn’t that mean that your offer a short while after the auction would be more readily accepted?

My point is I think auctions should be treated as merely sources of information on the demand and supply of properties.