I am looking at a recently rennovated unit, which if my offer is accepted will be slightly -ve CF to begin with, at a 15% or so premium to the market rent rate. (I’m hoping to attract a quality tenant with the renovations that have just been completed – new quality carpets and paint, kitchen surfaces & appliances etc).
I hope that rental rates will rise over the next year or so, and push this IP into a small CF+ situation. I’d need a raise of around 5% to break even, does anybody think this is likely?
I’m also looking to buy a place from the public trustee at auction (a deceased estate). This place needs a major cosmetic overhaul, but is structurally sound and is on a large block, close to all amenities and plenty of large industrial employers.
Does anyone have experience negotiating a long settlement plus access rights with the public trustee? I’ll be looking to do this so as to avoid paying interest while I complete the rennovation work.
So, I guess even though I bought Steve’s book just a few weeks ago and was raring to go with CF +ve properties immediately, my forays have shown me that you do indeed need to head out into the rural areas to find them. For me, with a young family and demanding career, my spare time might best be spent doing rennovation work in the evenings which my wife and kids can at least participate in, rather than me traipsing around the country chasing CF+.
So, my strategy thus far seems to be a “Buy, Rennovate and Hold” blend, hoping to achieve +ve CF in the next year or so!
The problem for me is going to be building momentum, since I’m using equity in my PPOR to fund the IPs. That equity will only allow me to buy 3 or 4 IPs, which is hardly going to see me repeat Steve’s 0-130 in 3.5 years!
Which leads me to another point, possibly off track in this thread: Do people think Steve’s success can be replicated in today’s market? Steve started near the beginning of this last boom and made extensive use of ethical wraps to kick the volume up on the +VE CF. I live in SA, where wrapping is illegal, so this won’t be an option. Are there any other SA members here who have tried “lease to buy options” to kickstart things?
Cheers, and sorry for the long post!
NathanOriginally posted by nchattaway:
I hope that rental rates will rise over the next year or so, and push this IP into a small CF+ situation. I’d need a raise of around 5% to break even, does anybody think this is likely?Hi Nathan
I can NOT see the rents gaing 5% In the next 12 months
I think we will be lucky to get 2%I don’t know if anyone has said this already, as there are too many replies for me to read at the moment. If you can find pos. cash flow i.p.’s all the better, buy as many as you can, but if you can’t, don’t be put off. Negative gearing is a wonderful thing, as it is better to pay interest and end up with something, than to pay tax and end up with nothing.
if you are buying at auction from a public trustee, they want their money. You cannot usually stall, they have time frames
They will have a list of terms and their contract at the site, advise you read the fine print. You can ask to be put ona mailing list I think too.
Elves
” a blind man may see what a sighted man may not”
Originally posted by nchattaway:Does anyone have experience negotiating a long settlement plus access rights with the public trustee? I’ll be looking to do this so as to avoid paying interest while I complete the rennovation work.
Nathan
In my limited (only 1) experience with the public trustee, they are not negotiable on anything. The unfortunate real estate agent cannot do anything except the usual. I do not see a positive outcome with you trying for a long settlement and early access. They are just trying to recoup the money ASAP for dissemination to the various creditors and/or family.
Sorry for beinga bit negative and maybe I just picked a PT agent that was having a bad day!
‘Eat rich food, barbeque a yuppie’ [greedy]
Rugby, no the hands are tied.
Public trustee is there for one reason and one reason only. Sell.
I went to one auction in QLD last year, in this instance the property was in a poor area. The bank would not have considered lending ratios as normal, because of the mix of tenants in the units. It was not a home.
You can get some good buys, the one I went to went over price.
Elves
” a blind man may see what a sighted man may not”
We have purchased houses & vacant blocks of land. Obviously there is no income from the land but the houses more than cover repayments and expenses.
Originally posted by kay henry:[/iCel, you can go to the monopoly.com site. They have all different versions for different countries. Might be Australia’s time to make up our own
)kay henry
Why not get to work with sticker paper and a colour printer to produce an Aussie stick-on kit for your existing set?
You’d also need to change the title deeds and a couple of the Chance and Community Chest Cards. Eg ‘Advance to Pall Mall’ would have to be ‘Advance to Oakleigh’ to match the properties.
‘Super Tax’ is amazingly prescient, but should be 15%, not 10%.
For Melburnians, the board is not dissimilar to the City Loop. Thus the stations, clockwise from Go should be Flinders St, Spencer St, Melb Central and Parliament.
The power and water utilities are fine, but there should also be phone companies and ISPs. One of the Chance cards should be a Citylink toll. There should also be extra cards for cap gains tax, fraudulently claimind deductions and interest rate hikes. A Negatively gearing card could mean that instead of picking up $200 as you pass go, you pay $200 for the next three turns or go to jail (your choice). And just for fun, a Henry George Card (pay 10% of value of your land holdings) would be fun.
But to balance this off there needs to be some mechanism of capital appreciation. Maybe a card doubling the list prices of properties for next 3 turns.
General Repairs to properties is good, but ‘Pay Each Player $15’ should be for the purpose of Tenancy Tribunal Attenance rather than the beauty contest.
The idea of buying 2-3 blocks before building doesn’t make sense. But making the ‘blocks’ strata titles and requiring posession of all titles to control the body corporate does to allow building does. Hotels should probably be apartment blocks.
Peter
I won’t ask you how long you have been working on that little bit of genius.
Why don’t you take your idea to a gaming company and you could even get it made into a PS2, Xbox or PC game. Imagine playing Monopoly interactively with people around the country or Globe.
Me thinks you should get down to the patent office quick smart!
‘Eat rich food, barbeque a yuppie’ [greedy]
You can play Monopoly online now, and there are several Australian versions of Monopoly already out including AFL & Melbourne versions
It is possible to go on UK pub crawls around the Monopoly board & I’ve heard of one seriously rich Monopoly fanatic who bought property in most of the streets represented on the original Monopoly board.
I like the PDA version of Monopoly (on Psion)
Cheers,
Aceyducey
Apart from this website and my own investments, I don’t spend a lot of time on the computer.
I was unaware that it was available in an electronic form.
Might be a bit of fun.
‘Eat rich food, barbeque a yuppie’ [greedy]
Rug said:
“Apart from this website … I don’t spend a lot of time on the computer.”
hehe Rugs, and how much is a “lot of time?” You do a pretty long shift on here! [fez]
kay henry
Hahaha! Not as much time as you would think.
I actually leave it set up and connected for hours at a time well at least until it goes into [sleepyanim] mode!
‘Eat rich food, barbeque a yuppie’ [greedy]
and follow the links to monoply online… [cowboy2]
Cheers,
sisIf you had a new Sydney version, the stations would be Central, Town Hall, Wynyard and Circular Quay (they’re the busiest four in the CBD).
But this would need to change every couple of laps of the board as they would move out of timetable order. (Apologies for any inconvenience caused). The Town Hall “square” on the board would need to be very thin and if more than one piece lands on the board, all pieces would need to be at risk of teetering over the edge.
+gearers as follows:
Purchased
Duplex $275000 rent $420 week
Townhouse $89000 rent $175
House $119000 rent $185
Unit $75000 rent $150
Unit $77500 rent $140
Unit $77000 rent $150
Plus two blocks of land – one producing fruit crop.All Regional Qld. Have just had a revaluation with a CG of approx. $100k over 12 months.
However we look forward to our tax return – have spent additional funds in air conditioning, painting etc.
)
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