Forum Replies Created
Yes you would need separate meters unless you pay the utilities yourself.
Outdoor areas should be separate.
The 2 halves of the house would need to be independantly lockable.
Are there common areas? If so that adds complication (eg bond issues, amenity)
If it is a shared laundry then you will need to provide the washing machine.
It is very unlikely you would need council permission to let a house to two people.
Are there separate meters for electricity, gas and water?
Am I understanding you correctly that your goal is to have an emergency fund of 100k? You are willing to give up $100k/yr growth to achieve this goal?
Unless someone has a gun to your head, selling in that situation I think would be a very very bad idea. With $1m in gross value and Sydney in a slump it is the worst time to sell.
Markets tend to transfer money from the impatient to the patient. Don’t be impatient.
Are you sacrificing capital growth? Absolutely YES
Property as an asset class is poor for income. LPT, CPT and high div shares have an excellent track record to provide what you seek.
Originally posted by fivetalents:Hi,
We are looking at buying around Burwood/Box Hill South at the moment. If you’re into developing you could pick up a old house on a subdiviable block that you could build a house on the back or completely develop later on if you wanted to. Box Hill south has reasonable size blocks and there are lots of examples of what could be done if you drive around the area. Especially the parts of Burwood and Box Hill that border Camberwell, Glen Iris and Surrey Hills as they have all had good growth over the last 12 months.Therese
That’s good advice, I too believe the “wave” that is going on in Richmond -> Hawthorn -> Camberwell -> Surrey Hills is about to hit Burwood and Box Hill South.
If you have 0, 1 or 2 houses then it really is simple. Read a couple of books (Steve McKnight, Jan Somers and Michael Yardney books for example) and away you go. There is a huge amount of information on how to build up a portfolio of 5 or so IPs.
If you have 10 or so and trying to figure out how to expand or retire then I can understand a mentor is needed because it is complex and every portfolio has it’s own characteristics.
The answer to your question is “Yes”. Over time though your wages will increase which will mean your PPOR payments will become less of a burden.
Also consider buying your first house as an IP and renting a place to live in to reduce the cash flow drain.
Originally posted by redspida:Transferring the property now will incur stamp duty. It may be a way for them to get the pension, but at $420 per fortnight is it worth the hassle and expense – Capital Gains Tax as well.
Hi Terryw,
is stamp duty payable even for transfers to family members without any money involved, just change of name on the title?
I thought capital gains tax is not applicable for a prime residency.Stamp is always payable when the name on the title changes. Capital gains tax isn’t payable though if it’s a PPOR.
Most property is pretty rubish for cash flow. However perhaps you need to think beyond selling and switch asset classes.
Why not borrow against your existing properties and buy shares/managed funds. These can then be margined to buy more.
Selling property means giving up the CG forever (as well as incurring a whole lot of extra costs).
Originally posted by geosan:. If you want a really good negative geared property go for it, but be aware of the problems that may catch you out.
………….
I will be pricing it so that it will be attractive to all those negative gearing investors out there!!!
You seem to not understand negative gearing at all. I can tell you that your investment is extremely unattractive to an investor more interested in CG than income (ie, your “negative gearing” investors).
In fact your experience sounds a warning to all those chasing primarily income in property investment.
I can’t think of a single circumstance that I would even consider buying a unit in the Melbourne CBD.
Is scarcity there? No
Is there a good prospect of CG? No
Is there good collateral value? No
Is the income OK? Um, maybeThat rates 1/2 star out of 4 in my book.
There’s no way anyone can give you an eductated answer based on the info you’ve given. My uneducated answer though is never sell real estate. [suave]
Maybe you could let us know though
– why did you buy the house (as a PPOR, as an IP for growth or income ??)
– why you are thinking of selling at the momentFung Shui is very real …. well OK ….. it’s about as real as the Bermuda Triangle, Lochness Monster and the Yeti. OK OK you got me, it has absolutely ZERO truth behind it.
There Ive said it.However, many people are superstitious so for this reason , and only if your target market is Chinese people, you should consider Funh Shui principles.
Good luck
Great to see you’re enthusiasm especially given what you have already had to go through at such a young age.
First I think you are on the right track with regard to real estate being a means to achieve financial freedom.
However….
The most important function of a job is to provide the means to get the initial seed for investments, and then to provide cash flow to support the investments. This is the priority. You do not need your job to be an education for your investments though.
So, although being a REA will help somewhat with education (but nowhere near as much as you think), it is very poor in the primary function of a job re: investment, a nice pay packet!!
So I would recommend making plans to go into a job that pays the most amount of money which might mean a uni education, and then educate yourself in investing in your own time.
Let’s talk Melbourne and Sydney.
It is unthinkable that the next boom would occur by then.
There is a great book written by Keiran Trass (sp?) on property cycles. There are 3 phases, boom, slump, recovery. Each of these three can be beginning, in the middle of, or at the end. If you haven’t read it I recommend you do, the insights on drivers vs. influences are very good.
So, FWIW, I believe Melbourne is at the end of the slump phase and poised to move into the recovery phase by 2007/8. Sydney is in the middle of the slump phase, poised to move into the end of the slump/beginning of recovery by 2007/8.
The recover phase for both cities will likely run for 2-6 years and only then will the boom start.
So the boom is at least 4, more likely 6+ years away. However money can be made in any phase of the cycle, including the recovery phase which is a great time to position yourself for the boom.
Not dodgy, just trying it on.
How did the tree fall over? Unless it was neglect on your part (eg the tennant had warned you it was dead or likely to fall over) I can’t see how you are responsible.
Call or email Michael Yardney at Metropole. He is a very experienced developer and a regular contributor on this board.
Originally posted by BDM:G’day Going For Broke,
Another suggestion, if you haven’t done so already, would be to refinance your IPs with a Fixed Rate Interest Only loan, fixed for 3, 4 or 5 or more years. This will make your repayments lower, and also be “locked in” for however many years you wish it to be.
This is good advice. The easiest and first things to cover are
1) minimise out goings, and switching to IO loans will really help
2) maximise income. Do you have a depreciation schedule? Is the rent at market rate? If you have 2 IPs can you negotiate down the PM fee or move to another agency.Only once you exhaust that would I look at renos to increase rent.
I would then look at setting up a LOC to cover shortfalls and see if that might be suitable.
I would then look at high yielding shares/MFs/LPTs and buy them out of a LOC to generate extra cash.
….
Only as a very last resort, look at selling and be sure to take into account CGT.
I would think car insurance. Best to ask the insurance company though.
There Ive said it.
