mcbeathMember@mcbeathJoin Date: 2003Post Count: 1
I have been interested in property for some time but have concentrated on negative gearing strategies. I have two homes at the moment, both expensive and negatively geared. I have $350,000 to spend now and want to buy many homes, all positively geared, but the boom coupled with the interest rates have made me nervous….we have experienced long term vacancy in the past and I am nervous about selecting an area in which to purchase. Any ideas? I have been thinking also about overseas investing but must admit that my knowledge of the overseas property market is not as good as Australia. Any ideas? I am looking at buy and hold strategy and am hoping to secure properties over the next 3-4 year period, and then settle in and pay them all off.
Help please? I would love to get some ideas from people on different areas?
Claudine [:X]Richard TaylorParticipant@qlds007Join Date: 2003Post Count: 12,018
Guess i am a little biased towards the Sunshine State.
We are still in most areas experiencing Capital Growth like never before and with the influx of Southern population vacancy rates are also low.
There is no such thing as a problem.
Just a solution waiting to be foundbannerParticipant@bannerJoin Date: 2003Post Count: 14
I can understand your dilemma. I’ve just sold a negatively geared property and am keen to get back into the market, positively geared or at least heading towards that area. Same as you, I’d like to buy and hold for 5-10 years and have $300,000+ to spend. I’ve done quite a bit of research and am coming to the conclusion that Qld looks good. I live in NSW so will have to do a lot of groundwork before spending money on a plane trip to look at properties with a view to putting a deposit on one. Like you, we have experienced long vacancies with our rental property and are a bit gun shy.
I’ve had a few tips with a friend of mine who is an older fellow and been in the real estate game for many years and he basically said you can’t go wrong if you buy on the eastern seaboard from the top of Qld to the bottom of Victoria.
Pretty vague advice but hope it helps forextraderMember@forextraderJoin Date: 2003Post Count: 23Chris-SydParticipant@chris-sydJoin Date: 2003Post Count: 75
One comment is if you put more money into the deal you can have the property be even more positivly geared.
Instead of buy lots of properties only buy 2-3.
If you try to buy in Sydney the $350k will be a good deposit and you may only buy 1.
As Dolf De Roos says buy with the following and all will be well.
2.Buy near the water
I think anywhere up or down the east coast.
All post are IMHO.noddiesMember@noddiesJoin Date: 2003Post Count: 151
As I understand the situation, given the small amount of information, your situation is as follows.
1/You have 2 negative geared properties and they are in an oversupplied area as evidenced by the problems with vacancy rates.
2/The corresponding yeild is lower than desired , so they are costing a lot to retain.
3/ You are concerned about the risks associated with investing in Austrailian property at the present time.
4/ As such you are wondering if you are better off investing overseas.
5/ You wish to expand your portfolio
6/ You would prefer to include positive cashflow into your strategy.
If you would like to work out a plan with me I would need to know more details about your situation in order to conduct a computer analysis
Due to privacy this is better to be conducted offline, where I can work out and propose the plan for you.
This will be made available at no cost or obligation to you.
If you wish to discuss this further, contact me on the link below.Please note that I am an investment consultant and not a real estate salesperson.FizmanMember@fizmanJoin Date: 2003Post Count: 10
I don’t really give much advice to people because I am still learning the ropes!! However, in this instance I feel I can confidently assist.
Take your $350,000 and put it all the the Wallabies to beat England this Saturday night!
GO THE WALLABIES!Fudge111Broz00Participant@fudge111broz00Join Date: 2003Post Count: 245
Good one Fizman, wallabies i think are at $2, so you can get 100% return in 1 day.
No seriously, if you do as Chris-Syd has said and focus in buying just a few, they will be close to being fully paid off, therefore you will have huge amounts of positive cash flows due to no loan repayment.
This is an option you can take if you would rather save some *Time* as you don’t have such a huge portfolio. You also have a higher pool of options as to which properties you purchase, you are not stuck to the 10% of +cf prop out there.
It depends on your needs and whether you want it to take up time or save you time, but that is probably what i would do, then i would use those positive cash flows to get a deposit for the next house and go from there.
Well, that’s my 2 cents worth
Fudge111enduserMember@enduserJoin Date: 2003Post Count: 74
There are a couple of issues about buying overseas. First the good news is that in the US, UK and a couple of others, the gross returns are around 6.5 to 7.5%, cf Australia at around 3%.
But exchange rate changes can defeat you if they move the wrong way. This is a minefield for Australians, not to mention the complex legals just getting ownership. In Italy, for example, a supposed single title property can have several geographic locations, some of which can be shared with other owners and/or users of various “rights”. Etc.C2Participant@c2Join Date: 2002Post Count: 518
Have you thought about refinancing your current properties and putting some of the 350K into them to make them +cashflow? Would 50K into each one be enough to make them +ve? This would still leave you with 250K to use as deposits on others or to even buy 2-3 outright. There are a lot of people saying they want to buy many homes, but how many do you actually need before you’re happy with the passive income you receive. Also unless you spend a lot of time o/s and know the countries well that you want to invest in be very carefull.
“Is it true the more you owe the more you grow until the bank steps in?”stargazerParticipant@stargazerJoin Date: 2002Post Count: 344
when you say refinance and put 50000 in to make + cashflow. You still need to service the 50000 you are using dont you?
Am i missing something here?
alfC2Participant@c2Join Date: 2002Post Count: 518
I was assuming the 350K was cash and not equity. If it’s equity then my answer doesn’t count.
BTW, did you see my response to one of your other posts (about your lender)?
“Is it true the more you owe the more you grow until the bank steps in?”