Hi

You sound like my wife and I were like about 5 years ago. We now have two kids under 5. This is what we did.

1. We too had a 2 bed unit (Parkdale). We sold that and put the money/equity in our PPOR (house Aspendale) – principal place of residence. To reduce non tax deductible debt.

2. We then went to bank and borrowed 100% for a similar…[Read more]

Houses Only

<<<The extent of the bust and the timing are the only things up for debate really.>>>>

What do you expect interest rates to be during this bust. Thats my largest exposure as with most people.

Do you expect rates to fall to stop the slide? In comparison to rates now, do you expect them to fall or be higher?

I am of the belief that…[Read more]

Kay

I dont think you understand the concept of investing in property for growth.

Property values in Queenstown do not grow at a rate worth investing. In my opinion save for a while till you can afford a quality property.

Say you buy 5 proerties in Queenstown for $50k. and end up with $2k postive cash flow on each. In 10 years as there is…[Read more]

Hi

I totally agree with mortgage hunter. I would focus on a house or a few houses in growth areas.

Land is what appreciates. I look forward to tax time to get my tax refund. I have some properties that were negative geared and one that currently is. The tax refund is like an enforced savings and I look forward to doing my tax.

With an…[Read more]

Hi

Everywhere in Australia has doubled in the past few years. Even Orbost has doubled. But that does not mean its going to double again soon.

So why even consider a place like that. Steve made his money at the right time and decided to now write a book of his experiences. Now many people have read the book and think they can emulate this.…[Read more]

Hi

Well said Michael and endorsed by Property Guru.

This should be the intention. I should have bought houses with subdividable backyards. That way after 5 years with the equity in each property you could put a unit in.

There are many other ways as well. Do a complete renovation of a unit and use the extra rent and equity to buy the next.…[Read more]

Hi

I agree totally with what you say Rowan. As Jan Somers advocates and I agree – its not about timing the market, its about investing when you can afford too. Thats why when I purchase a property its interest only fixed for 5 yrs. I even purchased one about 4 yrs ago – fixed for 10 years through NAB. Its already doubled but at least i knew…[Read more]

Hi Chan

Yes. Over time you will have a combination of all three types of properties (negative geared, neutral and positive geared). The properties that started out as negative geared become positive geared and support the new negative geared properties.

My main point is that you have to start somewhere. I believe you are better of in the LONG…[Read more]

Hi

I have a 2 bed and study property in Frankston (bayside Melb) and I cant get $160 per week. Sure it needs some work though.

I would check the rent appraisal if I was you. Sounds dodgy to me – but i have never been as far nth as townsville.

Cheers

Andrew

Hi Richmond

For what its worth Houses are better. But from a servicability perspective I did limit myself to units. If I had my time again I would have bought houses a few surburbs further down the bay.

Cheers

Andrew

Hi lymeng

Yes you can. I like Mentone and Frankston. Both on the Bay. Mentone is about 24 kms from city and Frankston is 45kms. Melburnians are only now apreciating the beach.

I grew up in Mentone and its is near beach, train station and some great schools. Mentone Boys and Girls Grammar (Shane Warne), St Bedes (Brad Hodge), Kilbreda and…[Read more]

Hi

I am not talking inner city. I am talking suburbs. I like near beach, schools and public transport.

In Mentone (surburb of Melb) you can still buy a 2 bed unit for $250k. It will be worth $300 to $350k in 10 years if history repeats itself. I am being conservative.

You cannot loose there.

I am sure there are other similar surburbs in…[Read more]

Hi

I read an article in the Herald Sun (Melb) and it expects that the average wage will increase this year by $2k (i think 3-4%).

I love it when i read these articles. This means as people get higher wages they can afford to pay more rent. I also love it when the price of goods say bread rolls goes up. That means it costs us more to live and…[Read more]

Hi

Why invest in an area that has properties that have returned growth of $2k on a 10 year property worth $70k.

I dont understand. Lets say you buy 3 properties. Thats $210k. Come back in 10 yrs and it worth the bloody same. No time value of money no growth.

Buy a $210k unit now in Melbourne. Yes you can. Come back in 10 years its worth…[Read more]

Hi

The way I see it. Historically the yield on property is usually 1-2% below the current interest rate.

In the past in areas like Frankston and Dandenong you always got a yield 1 to 2% higher than the current interest rate.

Thats not the case now, so be aware of that. Those that got into property 10-15 yrs ago will be circling those that…[Read more]

Hi Still in School

I started 5-7 yrs ago, so I have been able to ride the property wave. I started with the one property that was $90k. Now similar ones are $250k.

I dont have the $1m magic mark yet, but its not too far away.

All I am saying is that you are better off in the long term starting with the one property at $250k, consolidating over…[Read more]

Hi Peter / All

I totally agree. You need both (growth and yield). I just dont like reading posts about people focusing only on cash flow positive rural properties. These properties have taken a hell of a long time to appreciate. Just because they have in the past two years does not mean they will in the future.

Who wants the hassle of 3-4…[Read more]

Hi

My plan is not to get $1m of property now. I am talking about over a period time (say 5-7 yrs) while you are still working the normal job.

As the first property becomes cash flow positive you purchase another negative geared property and as that increases in value you buy another etc, etc.

You have to start with the first one at say $250k,…[Read more]

Hi Melbear

You sound like you are about 5 years ahead of me. I see myself working another 5 years then I would like to think most of the properties are looking after themselves, then I can focus on more positive geared ones and work more like part time. I have a young family with two young kids, so I still need a steady income/job.

But to get…[Read more]

Hi

My understanding is that you can also serve a notice to vacate a property.

If your reason is to renovate and sell there should not be any problems.

People do this all the time.

Cheers

Andrew