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Thanks for the quick reply mate!
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:)” title=”>:)” class=”bbcode_smiley” />spam
like the man said, thats $12 I could use for something else or even better $12 I could put into my future investments
many thanks Richard
ok thanks for all your advice… house is defn our choice but at this stage we had the deposit for an apartment and not so much a house. Plus having an apartment in the city would be a dream come true but then again we have to remind ourselves that this is for investment and not for us to live in.
many thanks once again. back to the basics to do more research i suppose
keep your thoughts coming if you anymore helpful hints and opinions on the subject.
T
Thought I'd answer your questions one by one so that i can pick your thoughts again…
What about the investment aspect of it? Before you start to look at ways to finance it, make sure it is a good investment. Yes in the heart of Melb; very close to everything and everywhere
If it is in the CBD, are you aware of the probable level of neg cashflow from it? Are you aware that 20% of the rent will be swallowed up in holding costs? Can you service the shortfall? I dont quite understand this taken that we are amateurs but its a free hold strata title; we can sell this off at any time. Also there is a guaranteed 5.5% nett in our hands.. for 5 yrs and upto 25 yrs if need be.
What size is it; anything under 50 sq/m will be very hard to get finance for, or will need a very large deposit – 40% or more in most cases. we are looking at studio apartment, 21sqm, but looking at putting this on our existing equity in 2 yrs time when this building would be completed.
Are there Council plans for more similar developments in the area in the next few years, which may cause an over-supply (happened in Melb earlier this decade). This will make it hard to get a tenant, or you may have to drop the rent significantly to get one (as happened in Melb). Poss, Melb is ever expanding and most prob yes but this is quest.. could you answer what the weather would be like in 2 weeks time? Investment is a gamble in itself, is it not? Aslso, rent guarantee…
What are the comparable values of similar sold properties in the immediate area? Be careful that YOUR cap gain is not already built into the purchase price (as is often the case).
Have they offered a rental guarantee? This is usually built into the purchase price, and is often above market rates, so when it runs out, your rent return drops. Yes 5+ upto 25 years
What are the rental yields like in the area for similar properties, what are the vacancy rates for similar properties in the area? Rent guarantee again
How many apartments will be in the complex, what are the body corp costs going to be, what are the costs for such things as lifts, rates. These could be expensive if it is multi-level. About 30-40 floors, body corp close to $1500.
Is there a dedicated car park for each apartment? not for studio apartment. in the city is there a need for carparK?
Why do you think the development company has suggested a Bank guarantee for the deposit? It's to entice newbies to make the purchase without using any money – all sounds attractive as you use very little money of your own, so it's easy to buy. Only suggested as i asked them about "dead money" as in my deposit
Off -the-plan apartments are very dangerous "investments" – especially in a climate of uncertainty like there is now, where interest rates are going up and buyer sentiment is dropping off. You may find that at settlement there has been no cap growth, even worse – the value may have gone backwards, and you'll be stuck with a property you can't get finance for. or it could be the other way around…
Sorry if I'm telling you to suck eggs, but it sounds as if you are new to this, and I don't want you to make a very big mistake. thats ok.. feedback is always good;
Take a step back, and do a LOT more research on the area first. Be sure of everything. what other research do i need to do apart from all that you have mentioned?
There is no hurry; there will be another deal of the century tomorrow. YES but at this price or at tmws price??!!
<br /:)” title=”>:)” class=”bbcode_smiley” />yes maybe so but we are thinking even MORE…
Yeah even though I have not done any courses, I cringe when ppl advertise workshops/3 day seminars/ weekend seminars and ask for $2K for the course. How could anyone justify that? I mean we are talking about 1000's of dollars here. I for one cannot justify that no matter what angle I look at it.
Just my 2c
Hi Jules,
Thanks for this info. I have duly noted them down on my things to ask pad. If you have other points from others and if you think of more, please continue to post them
hey Terry,
I send you an email mate, if you could reply to that that would be super!
Ian Landy wrote:Trance wrote:CoomeraWell that's a good start. Coomera ( gold coast ) is definitely a great area to invest from what I've heard. I am just south of the qld border and property is growing strongly here. Did you buy a new dwelling or an older place?
Ian
hey Ian
Where abouts in SE QLD mate?
Coomera
Ian Landy wrote:Hey Trance,Where exactly did you buy your 1st property?
QLD
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