I continue to hear that the property boom is about to bust… I’m looking at buying an IP (cost 120k rent about 220k) but in the back of my mind, I keep hear STOP the bubble is about to BUST!
Hi bluebear,
What’s your plan? The climate of property investing has changed already, I can feel it in the air [
], but it depends on where you are looking to invest in, methinks.
What do you WANT to do? That will determine if you buy or don’t buy.Cheers
Sooshie []There are no problems, only solutions
Dont spend your time trying to ‘predict’ what is going to happen, spend it being ‘prepared’ for whatever happens.
Regards,
Brett []“Even if you’re on the right track you’ll get run over if you just sit there.”
hello,
i keep hearing people i talk to talk aobut cycles in property. i have heard that perth is on a 6-8 cycle.
does anyone agree/disagree with this? and why?
Hi
Who really cares what part of the property cycle we’re in.?
Isn’t it really about making sure that the numbers makes sense (ie we make money) and that we manage our risks for any change in the market?
Why worry or hypothesise about what MAY happen, just deal with the here and now. That’s what I think
Cheers
David U
I continue to hear that the property boom is about to bust… I’m looking at buying an IP (cost 120k rent about 220k) but in the back of my mind, I keep hear STOP the bubble is about to BUST!Hi Bluebear
Just get going mate – make sure the numbers are right. You will definitely make money, if not in 2 years maybe in 4 years but the wealth will be there…Make sure you have some spare cash in case your property doesn’t get tenant for a few weeks or for urgent repairs.
B.T.W – may I ask where are you planning to buy this property. A return on $220 p.w on $120 K seems really good..Hope you will be able to share the info with the forum members.
Regards
GaryA good deal is a good deal no matter where the property cycle is!
If the numbers stack up and you know what you are doing then go ahead. The good thing with property (unlike shares) is that people need a property to live in.
APIM
*************
Australian Property SoftwareAPIM: http://www.apim.com.au
APDM: http://www.apim.com.au/apdm.htm
*************
go to a few auctions and then tell me its about to bust, i dont thinks so! although i heard last night from an insider that RAMs, Wizard etc can no longer obtain mortgage insurance for cbd southbank and docklands, thus they are no longer lending money in these areas. Stick with spillover suburbs to the east and west where theres no oversupply.
Hi I am new and I agree, it doesn’t really matter what cycle the market is in as long as you do your research. But what do people think of the theory of birth rates when it comes to making economic predictions about the property market?
Don’t think of it as one property market. there are many different markets eg country/city, luxury property/cheap stuff, Sydney/Melbourne etc. Even within cities there are different suburbs that behave differently.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi,
Just a quick reply to Gary Sehgal’s question if your looking for these sort of returns (or better) start looking in major regional cities, or regions around capital cities.
I’m not going to just name a few cause there are literally hundreds out there. Get on realestate.com and look at prices compared to rents of similar properties(hint look in the lower end of the market), returns of 10% and higher are common.
I’m buying two at the moment returning 12.6% and 14.4% gross respectively, and they are already showing good capital growth about 5% in 6 weeks!
It’s all about supply and demand, buy in a market where supply is low rather than a glut (eg: CBD units) and I feel you can’t lose.Regards,
Scott S“Aim for the stars and you’ll shoot the top of the telegraph pole. Aim for the top of the telegraph pole and you’ll shoot yourself in the foot!”
-anonHi Scott,
Are you sure of the capital growth potential of these properties you are purchasing? I would imagine these properties have very low capital growth.
I think most people have concluded that it’s either cap growth or cashflow in this market. I can understand people on this forum’s priority with postive cashflow. But it’s the leverage of other people’s money and cap growth where the big returns are.
Correct me if I’m wrong. I scratch my head everytime I read of someone who bought a regional property for their buy and hold, returning positive cashflow. It would be fair enough for a wrap, but $3-4 return a year with little prospect of cap gain doesn’t really sound appealing to me.
Regards,
JG
JG
It is possible to achieve both positive cashflow and capital growth from regional areas… I know I have.
Cheers
David U
David,
Do you know regional areas could be flat or even negative cap growth. I’m not sure how you got your cap growth, but I’m hearing alot about investors buying in regional areas hence pushing up the price of these properties. I don’t really consider this real increase in value, just increase in hype.
JG
Buying a “property with a twist”, as the Renovation Kings would say, is the way to go no matter where you are buying.
If you can find a property that’s perhaps a bit run down, in need of a coat of paint, then you may be able to get it for a lower price. Not only that but a reno could, if done correctly, can increase the overall value which intern can increase the rental capacity.
Property investing can be done in any economic climate. After all, we all need a roof over our head and good people live everywhere, not just in the CBD.Hi JG
I’m talking about regional towns, rather than country towns that you miss if you blink ie populations in excess of 30k. The growth has partially been driven by investors, but more so by corporate and infrastructure investment.
In my particular case, the growth has been driven by firstly purchasing correctly and secondly making minor cosmetic improvements on the properties; ie adding value
Cheers
David U
In case if bubble will explode the property prices will drop. How about the rent and interest? If it is not going to change, then virtually nothing will change for the investor: same rent, same interest, same repayments and same cash every week in the pocket (or out of pocket if the property is negatively geared)
I strongly recommend every one reads the weekend FIN.
A fascinating article about how much investment property dollars are misplaced into 600,000 square boxes at the top end of the market, eg docklands and other high rises, asking for 600 rent per week.
Guess which market will be the first to drop?
The bottom end of the market has a huge demand.
There is a very large part of our population that will never be able to afford to buy, its a real social dilema and it is that end of the market we should be focusing on as well.
In other words, low cost, comfortable, affordable and to us cashflow positive housing.
], but it depends on where you are looking to invest in, methinks.
]
The topic ‘BUST’ is closed to new replies.
