All Topics / General Property / what would u do with 600k cash??

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  • Profile photo of mattty73mattty73
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    @mattty73
    Join Date: 2003
    Post Count: 6

    what would u do with 6ook in cash????????
    i have a job which brings in 60k ..atm i owe 190k on my home.. i want to pay out straight away and in addition do the following…

    here are a few thoughts in my head atm….

    1… go and look for investment properties say 10, paying 20% dep with good yielding returns.. but with the bubble about to burst and interest rates..mmmmm i dont know

    2… look for comm property, buy outright and use that to spring board into more comm property looking for min 10% return on investment using the rental to accelerate the repayments

    3…buy about 2-3 houses outright and then use thier value to borrow against to buy a comm property using their cash flow to pay off debt.

    4… any other ideas out there would be helpful..

    come on all u sucessful guru’s… im sure some of u out there have some steller ideas….
    i dare u to help me fix my little situation..
    have a great day

    Profile photo of RussHRussH
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    @russh
    Join Date: 2004
    Post Count: 342

    When you are ready to start spending please give me a call.
    Russ.

    So many +CF properties in Western Australia.Let me help you. And we can achieve a win win situation.Russ.0438 659 411

    Profile photo of tonyy21692tonyy21692
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    @tonyy21692
    Join Date: 2003
    Post Count: 128

    Matty73

    You need to take a position on investment property now. ie are you in or out, now.

    We took the postion we are in. And in the last 3 months have bought;

    11 x +ve cf residential ip’s ($572K total all in country NSW pop.> 10K)

    and a +ve cf commercial building ($432K)

    These are all buy & holds and we are looking for more.

    Set your goals, make a plan and take the action.

    Good luck

    Tony

    Profile photo of Still in SchoolStill in School
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    @still-in-school
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    Hi Mattty73,

    best you start off first learning to control a small amount of money, once you have mastered that, then go for the big fish…

    …just would hate to see you or anyone lose a large amount of money…

    Cheers,
    sis

    People 4get that by saving just $3 a day & investing it sensibly
    over a working life, you’ll end up with around $1 million

    Profile photo of milkmanjrmilkmanjr
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    @milkmanjr
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    Definetly a good idea to be able to control 1 IP before looking to control 10.
    Also you seem to know when the bubble, as such, is going to burst? Any hints?

    J

    Profile photo of Still in SchoolStill in School
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    @still-in-school
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    Post Count: 1,844

    Hi Milkmanjr,

    Also you seem to know when the bubble, as such, is going to burst? Any hints?

    not sure if you were talking to me, but there are plenty of signs before a property market crash is about to occur, unlike the share market were it can happen almost instantelousy, there will be lots of media coverage in the weeks leading up…

    …dont be to worried, there will be plenty of killing time, before there is a property crash, and you will still have plenty of time to offload your properties, reduce risk exposure and mitigate problems…

    …if anything is going to happen, most likely you will hear it here first, before the general public gets to find out…

    Cheers,
    sis

    People 4get that by saving just $3 a day & investing it sensibly
    over a working life, you’ll end up with around $1 million

    Profile photo of jparriejparrie
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    @jparrie
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    The market is not going to implode, why would it? Interest rates are low and will stay low, inflation is under control and will remain so, etc etc.

    However, with rental yields so low and sentiment not being what it was, wouldn’t it be a good idea to spend the next couple of years just waiting and watching? Clearly, there will be no huge capital gains to be had from now on.

    If I had $600k I would invest it at 7.5% – instant access, 8.75% – fixed 12 months,(City Pacific mortgage trust) and sit back and relax.No tenant worries, no repairs, no crippling strata fees, just $3750 per month, every month. Shame that the Aus government is so unfriendly when it comes to savings. And tax rates in general for that matter.

    JP

    Profile photo of Still in SchoolStill in School
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    @still-in-school
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    Hi Jparrie,

    sounds like a good idea, but i see one huge flaw… presumming you did invest that money on an instant consistent return of $3750 a month…

    or $45,000 a year ($3750 * 12)… how much tax would you end up paying…

    it would be much better off invested into an assets that provides good debt, but at the same time is either appreciating in value or providing cashflow… but good debt must be there at the same time, to limit the amount of tax, that you could be liable for…

    Cheers,
    sis

    People 4get that by saving just $3 a day & investing it sensibly
    over a working life, you’ll end up with around $1 million

    Profile photo of ezy.home.loans23320ezy.home.loans23320
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    @ezy.home.loans23320
    Join Date: 2003
    Post Count: 144

    Hi , would you like me to count it for you?
    I have a friend in the realestate game and he said Casino NSW can’t get enough renters people are screaming for houses and units to rent.
    Kyogal is on the train line 3hrs from brisbane.
    prices are reasonable there as well.
    Prices in Lismore are getting higher but there is a new shopping mall train line , air port, and 20 minutes from the Beaches.
    [fart][whistle][weird][worried] regards I,m ezy

    Profile photo of qwertyqwerty
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    I like jparrie’s idea.

    At this time in the property cycle I would sit it out for a while. You’ve got to find a way of inducing your capital gains because the market probably wont give it to you in the immediate future.

    IMHO because of the large cash reserve you have I would look at developing something in the not too distant future.

    Profile photo of SiboSibo
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    @sibo
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    I would invest the money in a smaller number of higher class properties. that way you can get used to managing them, and then later springboard into more.
    Regards,
    Si

    Profile photo of beerboybeerboy
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    @beerboy
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    if i had 600g
    i would target future capital growth areas that
    will attract baby boomers by the sea.
    leave a little in the kitty for emergencies.
    create an asset,commercial,business,accomodation.
    just ideas.

    Profile photo of Tasman PropertyTasman Property
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    @tasman-property
    Join Date: 2003
    Post Count: 126

    put some in the bank, earning good interest, then offset the tax on the interest by conservatively gearing into property and/or shares as well (unless you like to take higher risk, are experienced and want everyting to happen faster).

    Say $100K in the bank

    and

    $500K + $500K borrowed = $1m property portfolio.

    Depending on your time available, you might like to manage deals yourself, or you may like to have someone manage them for you (my preference).

    Alternatively with that kind of cash you could become a financier or JV money partner for a professional investor, and get a higher return (say 10-15% flat rate) with higher risk, or a share in the profits of the deal.

    Personally, I would move to NZ and buy +CF deals full time, and hopefully never need to work again. Wait, that’s what I am doing [biggrin]

    (I believe that later this year there will be no +CF deals left in NZ. If you’d like Steve’s MAP protege living in NZ to leverage your time and find the deals to build your portfolio quickly, just ask me!)

    Profile photo of AceyduceyAceyducey
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    @aceyducey
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    mattty73,

    Give it to me.

    Seriously, put a % into property, a % into shares & a % into lifestyle.

    How you weight the % is up to you!

    Cheers,

    Aceyducey

    Profile photo of SuperTedSuperTed
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    @superted
    Join Date: 2003
    Post Count: 205

    I would buy $550K of NAB shares. Highest yeilding bank share atm (and fully franked).

    The other $50k leave as cash and go on a back packing holiday for 12+ months using this cash.

    When you get back cash the shares in (paying the cg tax) and add it to your 2 dividend payouts collected.

    Probably find after 12 months that you had a free holiday (adventure), are more well rounded and the property market is in a better situation for you to enter.[biggrin]

    Profile photo of Chris-SydChris-Syd
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    @chris-syd
    Join Date: 2003
    Post Count: 75

    Pay off your home loan as that is not tax deductable.

    Leaves 400K. Buy 1 IP outright in high growth area for say 300K. Then with 240K (80% LVR) in Equity and the 100K cash buy 2-3 more IPs.
    This will give you an excellent start with 3-4 IPs and possible of +ve cashflow on the IPs if you do it correctly.


    Chris

    All post are IMHO.

    Profile photo of jparriejparrie
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    @jparrie
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    Post Count: 17
    Originally posted by Still in School:

    Hi Jparrie,

    sounds like a good idea, but i see one huge flaw… presumming you did invest that money on an instant consistent return of $3750 a month…

    or $45,000 a year ($3750 * 12)… how much tax would you end up paying…

    it would be much better off invested into an assets that provides good debt, but at the same time is either appreciating in value or providing cashflow… but good debt must be there at the same time, to limit the amount of tax, that you could be liable for…

    Cheers,
    sis

    People 4get that by saving just $3 a day & investing it sensibly
    over a working life, you’ll end up with around $1 million

    …until the taxman beats you with his ever bigger stick!

    Profile photo of AceyduceyAceyducey
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    @aceyducey
    Join Date: 2003
    Post Count: 651

    Who cares about the tax – you earn more, you pay more tax.

    The idea is to build wealth, not create tax deductions!

    Cheers,

    Aceyducey

    Profile photo of mattty73mattty73
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    @mattty73
    Join Date: 2003
    Post Count: 6

    mmmmmmmmmmmm…. well i think 100k on the stock market 200k to pay for house…. and then look for comm retail property within 2 hrs from briz..300k
    now the challenge to find a good deal
    [comp]

    Profile photo of kay henrykay henry
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    @kay-henry
    Join Date: 2003
    Post Count: 2,737

    Acey said:

    “Who cares about the tax – you earn more, you pay more tax.

    “The idea is to build wealth, not create tax deductions!”

    Acey- it depends on how much you earn. Some of us want that big tax check back at the end of the year. For me, it’s very important to have deductions.

    kay henry

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