All Topics / Overseas Deals / Hypothetical Question

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  • Profile photo of TokyoJoeTokyoJoe
    Join Date: 2005
    Post Count: 60

    If you were lucky enough to have around $100,000 cash to invest in property and you had the resources to use this as a deposit to obtain further finance, what do you think your strategy would be?
    ie. commercial/residential mix. city/country mix.
    Your aim would be to maximise wealth creation, rather than trying to generate residual income.

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    Profile photo of Don NicolussiDon Nicolussi
    Join Date: 2005
    Post Count: 1,086


    This is a hard one as it really depends on where you are starting from and what you are trying to achieve.

    There is no agrument that some level of gearing will allow you to increase your wealth faster all other things being equal.

    What sort of property??? Will just say that each form of investment requires different skills from the investors side of things as well as the available capital to make things happen.

    You really need to know where you strenghts and weaknesses are and how much time you can devote to making sure that the investments perform to their full potential.

    Research, planning and management are probably the key initial considerations to look at.


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    Profile photo of Nigel KibelNigel Kibel
    Join Date: 2005
    Post Count: 1,425

    In my view if you are looking at capital growth in New Zealand then I like Christchurch. I think inner city suburbs like St Albans are great. You can still buy a great house for $250,000-$300,000 and get a return of between 5-6% and in some cases even higher. For these types of property you should recieve the same sort of growth that you would expect to see in many cities in Australia. I agree with Don and Liz. You must do your research. If you are looking for a stronger market there are parts of the USA that are great. Here you can still recieve strong growth and returns

    Nigel Kibel

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    Profile photo of MiniMogulMiniMogul
    Join Date: 2002
    Post Count: 1,414

    Great question!
    I would get preapproval and see how much you can borrow. i would then buy some property, something you can add value to. (do up, subdivide, re-tenant, unit title a block, add a minor dwelling, etc etc etc) and then re-value the property.

    If this is a negatively geared property, you can still make money, but you won’t be able to carry on indefinitely unless you sell, because your serviceability will run out. To keep going and cntinue to hold, you need cashflow.
    You will at some point need to buy or create cashflow positive property. Often some sort of adding value can give you that result.
    good luck

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