Yesterday I read 0 to 130 in one sitting inbetween entertaining the kids and doing the housework. I have decided that +ve cash flow investing is the way for me. Whilst the book was riviting and hugely informing, I feel I lack information about the types of property to invest in over here in Perth. I scanned the West Australian This morning and found it impossible to find a property that came close to the 11 second solution return of 10.4%.[crying] Are there any investors from Perth out there who could give me a head start – Pleeease!
Many thanks from a hopeful (and extremely knackered) Mum of twoAJ Carter-O’Sullivan
Hi Wormit,
Peter has replied to this question in the other forum board.
I’ll add a few comments to his (read them too) – you have just read a book that has motivated you to invest in cashflow positive property – that is the easy part.
There is so much more you need to do – see how much you can borrow, explore the need for a trust etc, getting yourself out and about and know to REA, developing your own expertise in identifying a good buy or not (just because a REA agents says yes – doesn’t mean it is), finding conveyancers you can work with and and and and – you get the idea.
In some respects you are now at the ‘reality check’ stage and are just starting to come to realise there is hard work involved – it is not just a matter of opening up the West and getting the deals from there – the better deals have already gone.
I recommend you read some of the posts here (as you are doing) and start making notes – getting tips etc and then reread the book to distil the fine details required to make your joourney a success.
Hope this helps.
Derek
[email protected]Read my comments? Think I can help you? PM or email me.
Thanks for the advice Derek.
Have spent most of this morning on the site and have found property areas of interest. However, none have yet matched the 11 second solution.Could you or anyone else out there offer some advice on what kind of leway I should give to this solution. Is 8% any good if the area is in growth and rental market is strong? Or is it a personal risk issue? Welcome any feedback.
Ps. Happy EasterAJ Carter-O’Sullivan
Hi Wormit,
I have a different investment belief to most people on this board as I am a growth focussed investor who prefers to invest in areas closer to the city which have a long term growth history and which meet my criteria.
As to whether or not 8% is manageable, or good, for you only you can determine the answer to that question. Without knowing the area you are looking at (you don’t have to tell me either) I recommend you check the long term growth, rental demand & employment opportunities in the area, infrastructure plans, the short and long term outlook for the area, distance from large population centres etc.
I, for one, am concerned that many investors have become too focussed on the 11 sec rule without ensuring the other fundamentals also stand the test.
For example I was speaking to someone in a small town, with declining population, not far from where I live that sees locals selling up to eastern states investors chasing cashflow.
Local REA are having a field day and the demand for low priced properties is creating a ‘false market’ that gives these ‘johnny come latelys’ the belief that even these towns have growth – my question what happens in a normal property cycle and with a declining population.
Hope this helps
Derek
[email protected]Read my comments? Think I can help you? PM or email me.
Its very unlikely your gonna find positive cash flow properties in Perth…
There going to have to be country properties…And they are out there…
Ive seen afew properties in WA… costing 100k with weekly rental of $300pw.. easily meets the 11sec rule..but after a little investigation into the town… was far too risky for me, in the long term…
As with any investment… theres a relationship with Risk and Return…
Just keep on getting more and more information about areas, towns etc… Shouldnt take you too long before you find a prop that meets all your criteria…
Agree with the above, i’d be looking for CG as well as positive cash flow with your IP’s.
Remember most loans are for a term of 25 years, so look long term with your investment.
Don’t purchase in some remote area on the edge of the desert with 10 residents, 2 dogs and a goat, just because it meets the 11 second rule.
Agree with Derek thet some locals in regional areas are ‘laughing all the way to the bank’ with some Eastern States Investors buying up thier Homes, not saying there’s no good buy’s just do your Due dilligence..[biggrin]
REDWING
“Money is a currency, like electricity and it requires momentum to make it Effective”
Hello wormit, I find myself in similar situation, and asking the SAME questions.
I agree with most comments and prefer to look at long term and quality property, that I feel will give me the $ at the end of the day.
I hear the same story over here from Real estate agents that there are “LOTS OF EASTERN STATE BUYERS”, buying in Collie, areas that are dead and dead cheap etc. Anyway, just do the research. Happy hunting, good luck to all
Collie… Note coal doesn’t last forever….Very cold place in the winter….
Success is 1% inspiration and 99% perspiration.
Coal doesnt last forever.Neither do humans.There are more things in Collie than coal.Try bauxite for example.Do some research and learn about companies who are expanding putting out 500 new jobs and the need for 200 rentals then come back and tell me Collie is dead.What a joke.
Russ.So many +CF properties in Western Australia.Let me help you. And we can achieve a win win situation.Russ.0438 659 411
RussH
from experience have found that most people would prefer to travel from Bunbury rather than live in Collie. DONT KNOW WHY????Agree with the fact many workers travel from Bunbury or Australind..
Kemerton was the town of 200 rentals required, haven’t looked at the issue though, have you ?
Redwing
“Money is a currency, like electricity and it requires momentum to make it Effective”
Originally posted by redwing:Agree with the fact many workers travel from Bunbury or Australind..
Kemerton was the town of 200 rentals required, haven’t looked at the issue though, have you ?
Goody, goody
As an Eastern Stater, I thought I would get in on this thread.
I thought the same about Collie last year and stayed well away. It looks dodgy with half of the town sold within 12 months.
I have actually just invested in Australind and I did the homework prior. I agree with Redwing that the area is taking off as a satelite suburb of Bunbury.
I will be over in May to look at my investment and any others that I may find.
I know the area a little and it has grown astronomically in the last 5 years. Collie may end up a bit of a ghost town.
‘Eat rich food, barbeque a yuppie’ [greedy]
Rugbyfan.
I have 2 children living in Collie and a third about to build there.Whilst australind and Bunbury are hot favourites for there coastal location it doesnt necessarily mean that everyone will want to live there.Property has risen from 50k to 70k in the last year or so and it is still rising.The cheapest you will get in Bunno is 120k maybe.It surely doesnt point to a +CF does it.
I bet you didnt pay 50k in Australind.And I also bet it isnt +cf.
Thats what this site is supposed to be all about isnt it?
Yet most of you investors are into -ve
Russ.So many +CF properties in Western Australia.Let me help you. And we can achieve a win win situation.Russ.0438 659 411
Originally posted by RussH:I have 2 children living in Collie and a third about to build there.Whilst australind and Bunbury are hot favourites for there coastal location it doesnt necessarily mean that everyone will want to live there.
You are correct, not everybody wants to live their, but the City of Bunbury is growing much quicker than Collie. It certainly points to a better area to invest for CG.
Property has risen from 50k to 70k in the last year or so and it is still rising.I think you will find that Collie’s prices have been artificially inflated by some Eastern Staters who think they have found the end of the rainbow. I see no reason for the prices to keep moving up and they will probably fall once the buying frenzy finishes.
The cheapest you will get in Bunno is 120k maybe.It surely doesnt point to a +CF does it.
I bet you didnt pay 50k in Australind.And I also bet it isnt +cf.No and yes, Russ.
The house is more than $120K and with depreciation is +ve CF by more than $35 p/w. Whilst it is only +ve through depreciation, it is still +ve and the CG will be so much higher than Collie IMHO.
Thats what this site is supposed to be all about isnt it?
Yet most of you investors are into -veWell, I can’t answer for everyone, but personally I am into making money. I have diversified my investment portfolio so that I have a mix of +ve, -ve and neutrally geared properties and shares. My situation is different to some, I realise, but I see this site as a way to learning about property investing and not just heading blindly down a one way track to the ellusive +ve CF property.
I don’t care what anyone says, good +ve CF properties are very hard to find now (not impossible). It has taken me a long time to find the ones I have currently. +ve CF properties will become even more scarce in the next 12 months IMHO but that won’t stop me investing.
When I was about 18 and started getting interested in the share market, my Dad told me always to diversify my investments. He has become pretty successful with his diverse investment portfolio, so I guess I am just taking his good advice.
I seriously doubt there would be many on here that would argue against diversification if they were in a similar position to me.
Even Steve says there is a point to investing in -ve geared properties. It all depends on what your goals are; what you hope to achieve in the short and long term.
‘Eat rich food, barbeque a yuppie’ [greedy]
A possible. ECU Woodlands campus is relocating to Joondalup. A property in Heathridge just across the freeway would be ideal for rental student accomodation bringing in about $280 per week making the property cash positive. It would have to be furnished tho’. A phonecall to the uni campus student affairs officer would put you onto the good info.
Regards
Petros Umgaga. s
Originally posted by Rugbyfan:Originally posted by redwing:Agree with the fact many workers travel from Bunbury or Australind..
Kemerton was the town of 200 rentals required, haven’t looked at the issue though, have you ?
Goody, goody
As an Eastern Stater, I thought I would get in on this thread.
I thought the same about Collie last year and stayed well away. It looks dodgy with half of the town sold within 12 months.
I have actually just invested in Australind and I did the homework prior. I agree with Redwing that the area is taking off as a satelite suburb of Bunbury.
I will be over in May to look at my investment and any others that I may find.
I know the area a little and it has grown astronomically in the last 5 years. Collie may end up a bit of a ghost town.
‘Eat rich food, barbeque a yuppie’ [greedy]
[aacool]
Hi Wormit, I’m from Perth and pretty new to this forum as well. Look, I actually stumbled across a cash flow property by accident and through stupidity too – I’ll explain. The property’s in Midland, I wanted it because Midland’s a bit of a hot suburb and I was prepared to go into a heavily negative geared deal. The house needed work ($90 p/w tops) on a 1/4 acre etc and it had a large workshop down the back.To cut a long story short, the vendor wanted to rent the property back from me for 130 p/w, I figured he only wanted the workshop (which was right) so I fixed up the house for $3000 and now have both rented at 120 and 130 p/w respectively. Please don’t think I’m boasting, I just wanted to let you know that opportunities are there, perhaps not he traditional ones (country towns etc), but ones that require thinking outside of the square.
I hope this helps.Warm regards
DeanWell done dpeka
Dean…
Well done.. thats thinking outside the box…
A little off the topic, but how do the tenant separate the electricity usage etc ??Midland… Is your block a development block also??
hi Kelvinh,
The electricity account is held in my name and I invoice the two tenants accordingly, the workshop has a secondary electricity and water meter. Yes the block is also a development block 1090m2 R40. I’ve enjoyed quite good capital growth with this one also.Cheers Dean
Congrats Dean..Midland has potential, and the Council there are “busting a Gut’ to get some solid business happening agian and harrasing the Government..
Still some cheap IP’s here..
And LOTS happening up North of WA[biggrin]
REDWING
“Money is a currency, like electricity and it requires momentum to make it Effective”
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