[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

November 2, 2007 - 11:16 am

Hi (again) Neil, 

you have been very broad-minded in  your reaction to the various responses…mine included. (Good on you). I didn't really think it likely that you'd seriously consider down-sizing your home: it was just a consideration possibly worth running by you.

All the best

Wilrose 

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

October 25, 2007 - 10:32 am

Wow Neil……you leave me stunned by the amount of personal mortgage you carry on your home: While I appreciate that it will be going up in value, you are working fairly hard I'd say just to pay the tax man, and the bank. What's the long range plan? Will the house ever be paid off? If not, then do you plan to sell and scale down upon retirement putting the equity in a freehold unit or apartment type residence? Would it be possible to readjust your domestic affairs to include a much less expensive home, (with a much smaller mortgage) and then commit the balance of the funds currently funding your personal mortgage, into IP mortgages? My view is that you'd have a larger investment footprint due to the fact that your IP costs (such as exceed your revenue) are mostly tax deductible. You could step out further from there as you feel appropriate.

I'd be interested in other forumite's views here also.

Wilrose

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

September 16, 2007 - 11:32 am

Hi Sharif,

I would be intrigued to confirm that you could buy anything at these prices that would interest FEA to lease at the rates mentioned, without substantial adjustments for the offsets required via management plans for gullies and watercourses etc.  In addition, Tassie is quite expensive by mainland standards today, so any land at $2000 per acre is highly likely to be entirely unsuitable in so far as the plantation company's needs are: eg too rocky, low rainfall location, too much waste/offset areas etc. The land they now hold freehold from the past few years of activity (many thanks to the gullible city taxpayers (who've funded all this)  who only hold the title to the "crop" (which has a very dubious future value) is of a quality that it would fetch $5 to $6k per acre today. Point being: $2k per acre land is very inferior stuff, and probably not suited to them in any meaningful way. Be very Careful!!

Wilrose

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

September 1, 2007 - 10:16 am

Not too sure about this tool…….my score was about 8000, and this equated to us running out of money in 2029. If our asetts were sold down, the interest earn't from the net equity invested at bank rates would considerably exceed the $80k nominated as living allowance requirements. (We don't find the need to spend anything like $80k now nor do we expect to for some time yet if ever, but we thought we should allow for the possibility for the sake of the exercise.) Of course we would not be likely to sell the asetts anytime soon as the net operating revenues (which continue to grow annually) currently exceed the $80k by 5  or 6 times. Even if the net equity were realised and just applied to annual living, since it would be ex capital funds no income tax would result so I should have used perhaps $60k, and by my calcs,(notwithstanding inflation) we could maintain that lifestyle for 35 years, not 22.
To be sure I was quite surprised to see such low scores from so many forumites so far. The wealthy ones must be holding back. To those who are battling to get ahead in the 9 to 5 jobs in the towns and cities: consider dairy farming! It is truly a wonderful career, providing enormous scope to test your mental and physical prowess, raise a family, travel the world and enjoy a host of recreational activities partially tax deducted, become involved in smaller communities for a most rewarding sense of belonging…really anything goes with Dairying. If you like computing, maths, genetics & genealogy,  physical exercise, animals, (cows and calves are magnificent animals) agronomy, (growing plants….pastures and crops are plants), working with modern machinery and sophisticated equipment, like a healthy lifestyle, like to be able to attend the kids sports days at school etc, but especially like wealth accumulation…………..then find out something about it and give it some thought. Despite the media reports, those with a bit of go in this industry can start with nothing but a dream, and without family help (which admittedly most do get…..but which we certainly did not) can essentially achieve being the Boss in as little as three years, and be financially free in 20 to 25 years. (And I should emphasise the cost of living comparatively well on a farm is probably much less than half what it is in the cities……I reckon it's better in my pocket than someone else's.) To those of you who cannot imagine such a radical change or who doubt this thread, all the best anyway.

Wilrose

(can't get that jolly emoticom out of my text!)

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

May 1, 2007 - 1:08 pm

Wayne…you write, "interesting comments"…………in what way?

Wilrose

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

March 29, 2007 - 12:19 pm

Hi all,

can anyone advise where to check on your own history of posts? I would like to find mine to see if there's been any replies but are a bit lost at this present point in time.

Wilrose

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

March 23, 2007 - 1:29 pm

To further this discussion, I would be interested in forumites comments etc on a scenario we are working through:

Commercial property advertised for sale by normal method…..price excessive at $1.65m. Realistic Price range probably $1.0 to $1.2m. Elderly Vendor is persuaded to switch to rival agency after only four weeks (even though interest being shown by a number of parties). New agent sweet talked Vendor with promise of much better outcome…….via the auction method. The cunning Sod books auction date in 4 weeks. I wonder how many potential purchasers are knocked out because of there being insufficient time to get all one’s ducks in a row as regards (for example) valuations and refinancing of other properties to tap into equity in order to flush out deposit funds in preparation for the deal.

Agent fairly loose in presenting rental details accurately…..and arrogant when discrepancies brought to his attention. Couldn’t care a toss.

Agent’s suggested solution to resolve logistics issues that we face as to timing……..put an offer in writing, if the auction comes up short, our offer could be brought into play. My instincts tell me this would just be a weapon to be used by the Agent at the point of the highest bid falling short of our offer….not to benefit us, but to get the bidder over the line for a clean deal.

Am I too cynical?

Are there any clever suggestions as to other strategies that might be considered here?

warm regards

Wilrose[thumbsupanim]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

March 4, 2007 - 10:17 am

Hi Wayne,

By the amount of traffic on this subject, it clearly causes a considerable level of discussion and deliberation both off and on line. No, I do not lease vehicles. Business opportunities allow for a significant percentage of the depreciation, interest, (including opportunity costs), running expenses etc to be factored into the mix when evaluating our options. I agree that the “showroom floor purchase” option is expensive (as indeed is the lease option because all of these expenses are fully factored into the lease), primarily because the “on-road” and GST component are an integral part of the immediate losses to incur. If you’re not self employed and in a higher tax bracket, or do not have a serious use for a vehicle of a particluar configuration or price, then I would shy well away from any expense you can, save for the minimum you can settle for, taking into account family needs (not wants). Do not be pressured from any quarter to buy above your medium term needs, but also do not be so mean as to expose yourself excessively to the rapacious excesses of the auto repair, maintenance and service industry. Once again, my thinking is to buy as per my first post. The vehicle’s history will be fully documented, (allowing you to check in confidence), and the style of the drivers will have been (most likely) careful. You will buy at wholesale, with the greatest chunk of depreciation having been wiped from it’s value, and at all times not be having to put up with the BS of the car sales people. I am reminded at this point of an excellent experience we had with a near new car that was ex Hertz rental. If you do this don’t buy a little one as they will have probably sufferred from hard driving.

Sorry to have taken up so much space…hope this helps. Whatever you do, avoid buying anything for the tax reasons….that should always be secondary consideration at most.

warm regards

Wilrose[thumbsupanim]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

February 28, 2007 - 1:21 pm

The views expressed thus far seem to cover the spectrum, except to add that perhaps some new cars are really a very good option in certain circumstances: eg, In the range of $17500 to $28000 (which will cover 1.6 litre Hyundai to 4 litre Falcon/Commodore, all ex gst) , should you have self employment status and significant taxation bracket, you can benefit from the tax angle, while also driving in a highly reliable, fully warranted, (including full roadside assist), up-to-the-minute safety specced vehicle, complete with new everything including tyres and rego…..all adding up to very low operating costs save for the depreciation aspect. Often the costs of owing a much older car are severly underestimated (including the safety issues in relation to airbags, ABS etc.) My experience is that a used vehicle ex govt auctions at about 40km, three years old, ex health department is the soundest strategy. The first driver is usually a person of mature attitude (read “careful operator” ), servicing will usually have been done religiously as required, the “on-road” costs and the GST have to a large extent been forfeited by the first owner and the purchase will be keenly priced to wholesale market values. What could be better? At the end of the day, do you want a vehicle to be reliable, safe, economical and able to blend in……….leading to a good long period of trouble free ownership, thereby saving alot of time (money) messing about with repairs, more frequent hassles with changeovers, late and missed appointments, embarrassing breakdowns etc, etc.

Each one must do their own assessment for their own respective situation…one size certainly wont fit all.

warm regards

wilrose[thumbsupanim]

If you are doing heaps of kids sports stuff or carting about reno tools/materials, then certainly a “knockabout” is the go.

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

February 28, 2007 - 12:46 pm

would it not be impressive if I could spell my own on-line name?

warm regards

wilrose[thumbsupanim]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

February 28, 2007 - 12:42 pm

Hi Chaps……just for clarity, is a HDT a Hybrid Discretionary Trust? If so, how does this fit into the scheme of things, and are the benefits available thru any other avenue?

warm regards

wilorse[thumbsupanim]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

February 14, 2007 - 1:27 pm

Hi y’awl,

to HookhamC: what are you driving at with this last post?

regards

wilrose[thumbsupanim]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

February 10, 2007 - 12:44 pm

aha Nobleone…..(interesting nom de plume!!) Fair comment ( up to a point)…………….but isn’t the forum going to function best where whilst you seek help and ideas, you offer it in return to those less (or differently) experienced/educated than yourself? For those who read your post, it is necessary that they clearly understand your issues if they are going to understand the replies and responses. Of course, you are free to do as you see fit.

With greater understanding of your situation, for what it’s worth, it would seem to me that you have far too much debt, way too little equity, and too little income at the present point in time. Just because the bank has provided this facility doesn’t mean that you have to apply it……..you could simply consider it principle paid down on your home. (PPOR). Alternatively, perhaps you could seek ways to enhance your income. Failing that you may just need to allow time to have an effect on your equity, though admittedly this could be slowish in the present market.

with respect and kindest regards,

wilrose[thumbsupanim]

ps……as you may deduce, all is now crystal clear for me re the acronyms…………though possibly some out there may remain uncertain.

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

February 9, 2007 - 2:06 pm

to qlds007 (Richard Taylor)………huh? How does this trust thingy work regarding the ppor?

wilrose[thumbsupanim]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

February 9, 2007 - 1:13 pm

so sorry Cherry Pro……..i did not read your post properly: I see now that you have negative equity. This would swing me back to the earlier advice posted by others in some ways. On the one hand, you could sell and then set about paying off the outstanding debt….say $9k per year in interest, and principal payments as extra….how long this would take you might calculate, and what relief/distress effects would you experience: or carry on with the current strategy…….perhaps 7 years ( at say 6% average growth per annum ) to recover the capital value ( to $470k) plus another 2 years to recover your additional investment in negativegearing interest costs over this period. Not the best situation, but one that you will overcome I’m sure. (will the average growth be 6%? perhaps less?)

all the best (again)

wilrose[thumbsupanim]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

February 9, 2007 - 12:57 pm

Hi Cherry pro

this is a conundrum for many (as you no doubt realise). My view is to stay tuned to the market shifts……if you believe it will be many years before a return to profit occurs, consider the alternative options you may be forsaking by remaining in a zero growth market. Should you find something that promises better returns, I’d reckon that selling may be the go. Remember, you are currently losing $8k per year….that’s not small potatoes if it’s early in your investment career, and each year it’s compounding, leaving further behind (when the real numbers are in) to making a recovery!!

all the best

wilrose[thumbsupanim]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

February 9, 2007 - 12:45 pm

I see no responses thus far Nobleone……perhaps if you were to breakdown the acronyms….Certainly I’m unsure what you’re on about with respect to a few?

wilrose[thumbsupanim]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

January 3, 2007 - 2:31 pm

Hi Folks,

From Ricky Ponting territory…….I can add that management fees for our commercial properties (Retail in regional city…what else) are 5% + GST. I have no idea what letting (retenanting) fees are as I drive from the front seat in this regard to ensure everyone’s best interests are served properly. All other activities are covered by this rate. WA PMs must be greedy sods, but I guess market forces are in equilibrium. I must confess that the posts throughout this forum are a bit discouraging with respect to residential as a means to an end…..what are other folk up to in the commercial field?

wilrose[thumbsup2]

[wilroseMember@wilroseJoin Date: 2006Post Count: 21]

December 30, 2006 - 2:30 pm

Hi Folks,

this is my first post….and largley prompted by response suggesting producing a bogus reference. Tut Tut!

Credibility is critical and should the agent or property owner follow thru with a check then you just might find yourself very quickly despatched to the blacklisted file.

I would endorse the other recommendations such as recruiting the assistance of an older family member or friend to visit the interview with you, (once again neat appearance, conservative would be best), a reference from your Employer and the offer of additional bond and rental in advance would be quite persuasive.

Best luck, honesty is the go..

W [thumbsupanim]