- Jenny1Member@jenny1Join Date: 2004Post Count: 269
I have bought a property in July last year $339,000 rent is $320pw(seemed like a good idea at the time) but I now know that it was the wrong property to buy as it is – geared. I have 3 other properties that are cashflow + and are doing ok.
Considering the climate for selling(yes I know you should look investing for the long term) and the cap gains (50% under 12 months) what advise would forum give me…Yes I have learnt from this, but that is what it is all about.
Thanks in advance
Jenny1landt64Participant@landt64Join Date: 2004Post Count: 166
for what’s it worth, I would hold on tight to this property. 50% captial gains in 12 months is astounding. You’ll see that a lot of seasoned investors on this site have a mix of negative, positive and neutral geared properties, so maybe you’re not doing too badly.
LandtDerekMember@derekJoin Date: 2004Post Count: 3,544Julian2Member@julian2Join Date: 2003Post Count: 82
I recommend you pick up a copy of Steve’s latest book and read it from cover to cover.
No-one can say whether you are likely to continue with your capital gains or not – that is up to Mr Market.
Mr Market might decide that your property is going to keep on going up or he might decide you’re in for a 20% dip.
At the end of the day it’s up to you. Do you take the profit and put it to work, or do you leave the investment alone and hope it keeps going up.
As the property isn’t putting cash in your pocket, and as 50%pa gains aren’t sustainable I would be tempted to take the money and run. But then again I don’t know the property.
Julian2Jenny1Member@jenny1Join Date: 2004Post Count: 269
I think it is all a bit mind boggling sometimes, yes I make my money work. I have used equity in my properties and currently have offers out on 2 new ones at the moment.
It is all very exciting as I love the process the negotiating, as I am on the net everyday there is so much choice but not knowing whether I have a dud property tying up my funds…I know need to be patient.
Thank you for all of the comments posted.
Jenny1AceyduceyParticipant@aceyduceyJoin Date: 2003Post Count: 651
What’s your issue with the property?
The negative gearing only?
If so I suggest you keep it. Your CG more than makes up for it.
If you are having issues with tenanting it, there are constant maintenance issues or you have reason to believe that the value of the property will slide and stagnate for a long period of time such as it being in a regional area with 20 year cycles, then you have reasons to consider getting rid of it as a ‘dog’.
In theory, there is no difference between theory and practice. But, in practice, there is.
– Jan L.A. van de Snepscheut