Thanks to Steve McKnight and his book, my new wealth creation strategy is to purchase as many cashflow positive properties as it takes to earn $100,000pa of passive income. This is approx 65 properties each earining $35/week net positive income.
Ive been trying to come up with some ideas on how to locate some good cashflow positive properties, i came up with the idea of following the big mining companies’ large long-term projects, and basically looking for property around those suburbs. I thought that if i could get tennants that were miners, that would increase the likelyhood of the tennants sticking around alot longer. Also the suburbs that are near minig towns obviously have very cheaper property compared with the cities, so i thought it would be easier to find a positive cashflow property if the purchase price was say under $100K which alot of these are.
Question 1 – can anyone find any flaws in this logic? has anyone had any experience in minig town properties?
Question 2 – Does anyone know of any good realestate websites that have alot of info on rental expectations of the properties, realestate.com.au hardly says anything about how much houses would rent for.Thanks guys
KALTSHello Kalts,
Some mining towns are fine to invest in .Just do yr research thoroughly.
Something i would remind you though is running 65 cheaper cashflow propertys takes alot of maintenance.It will become another job for u.If you are looking to stop work you will need to have enough income from the propertys to pay someone to manage yr portfolio and follow up on property mangers etc(,it all take s time.Especially with 65 props.)Then work out yr figures on how much will be left over for u.Luke Taylor | Hope Property Investing
http://hopepropertyinvesting.com
Email MeProperty Support,Strategist and Buyers Agent
Originally posted by World Changer:Hello Kalts,
Some mining towns are fine to invest in .Just do yr research thoroughly.
Something i would remind you though is running 65 cheaper cashflow propertys takes alot of maintenance.It will become another job for u.If you are looking to stop work you will need to have enough income from the propertys to pay someone to manage yr portfolio and follow up on property mangers etc(,it all take s time.Especially with 65 props.)Then work out yr figures on how much will be left over for u.Thanks for your thoughts World Changer,
To be honest, i hadn’t really thought of it like that, it makes sense, i guess i need to do some more calculations.
While we’re on the subject, do you have any suggestions on how you would alter this strategy (you called these properties “cheaper” cashflow properties, but i havent been able to find properties that would yield much more than this, have you found differently?)Thanks
KALTSHi KALTS,
Have a look at Mt Isa, its a large town that is really moving ahead and still offers quite good cashflow. I have a couple of clients who are developing up there, I’d be happy to put you in touch with them if you are interested in the town, they are a wealth of knowledge.
Regards
AlistairHi Kalts
Mate I currently live in the Isa and have done very well out of using a simpler stragery to you. I have found of late that prices have risen very sharply in mining towns around QLD (not sure about other states). I am always happy to talk about realestate in the QLD mining areas if you want to drop me a line.
Western buyer
hi
correct me if im wrong but this is from my experience. that was my thoughts about 2 years ago, buy as many +ve cash flow properties as possible, but in order to buy a lot of properties (65 as you say in your case) you need 2 things! income and EQUITY!! just because properties as self sufficient (+ve geared/+ cash flow) doesnt mean the bank will allow you to buy as many as you want (maybe 2-3?) you still need to consider LVR and paying LMI. Buying high return properties with give you the servicability but having little equity will reduce the number of people willing to loan you the money. (you may be able to go to non-major bank money lenders, but im not sure what their lending criteria is!) it didnt stop me buying, but you just have to do it steadily! realistically 1-2/year? thats what i think, let me know what you think? good luckOriginally posted by APerry:Hi KALTS,
Have a look at Mt Isa, its a large town that is really moving ahead and still offers quite good cashflow. I have a couple of clients who are developing up there, I’d be happy to put you in touch with them if you are interested in the town, they are a wealth of knowledge.
Regards
AlistairHey APerry,
Id appreciate the introduction, id love to learn more about the area.
Thanks for you help.
KALTSOriginally posted by esnam:hi
correct me if im wrong but this is from my experience. that was my thoughts about 2 years ago, buy as many +ve cash flow properties as possible, but in order to buy a lot of properties (65 as you say in your case) you need 2 things! income and EQUITY!! just because properties as self sufficient (+ve geared/+ cash flow) doesnt mean the bank will allow you to buy as many as you want (maybe 2-3?) you still need to consider LVR and paying LMI. Buying high return properties with give you the servicability but having little equity will reduce the number of people willing to loan you the money. (you may be able to go to non-major bank money lenders, but im not sure what their lending criteria is!) it didnt stop me buying, but you just have to do it steadily! realistically 1-2/year? thats what i think, let me know what you think? good luckHey esnam,
Thanks for your input.
I had thought about this issue alot, to be honest i hadn’t got around to investigating it fully.
You say that a realistic rate of purchasing is 1-2/year, has that been a strategy that you’ve adopted if you dont mind me asking, if so how is going for you?
So how is it that Steve and others talk about buying so many properties in the space of 12-36 months?
Any thiughts on this?
Thanks
KALTSHi KALTS,
I have pm’s you the contact details.
Regards
Alistair
correct me if im wrong but this is from my experience. that was my thoughts about 2 years ago, buy as many +ve cash flow properties as possible, but in order to buy a lot of properties (65 as you say in your case) you need 2 things! income and EQUITY!! just because properties as self sufficient (+ve geared/+ cash flow) doesnt mean the bank will allow you to buy as many as you want (maybe 2-3?) you still need to consider LVR and paying LMI. Buying high return properties with give you the servicability but having little equity will reduce the number of people willing to loan you the money. (you may be able to go to non-major bank money lenders, but im not sure what their lending criteria is!) it didnt stop me buying, but you just have to do it steadily! realistically 1-2/year? thats what i think, let me know what you think? good luckYou must be logged in to reply to this topic. If you don't have an account, you can register here.
