All Topics / Help Needed! / rock and hard place

Viewing 9 posts - 1 through 9 (of 9 total)
  • Profile photo of john wjohn w
    Member
    @john-w
    Join Date: 2009
    Post Count: 2

    G,day,everyone
    I have just bought a house and land package as an investment on the Gold Coast,which will be negative geared to the tune of approx,$75.00 per week,then I walked into a book shop and saw a book called "0 to 130 properties in 3.5 years".
                     
                  After reading the book I thought,what have I done,I,ve just screwed myself and maxed myself out to the hilt.
    I would like to get involved in wealth creation projects,but because I bought this property does it mean I,m in a situation that i can,t do anything until the  housing market picks up. Any ideas
                                                                                                    Thanks  

    Profile photo of Scott No MatesScott No Mates
    Participant
    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856

    Consider why you have 'invested' – was it for a quick buck? No, PI is a long-term strategy. If necessary, consider doing some inexpensive work to the house (ie no more than $5-10k, less if possible) to improve the appearance and increase your return.

    You won't learn what not to do until you've done it.

    Profile photo of ducksterduckster
    Participant
    @duckster
    Join Date: 2004
    Post Count: 1,674

    Pay as much as you possibly can off the loan or into an offset account and you will get the investment to the point of cash flow neutral position eventually.

    Profile photo of kum yin laukum yin lau
    Member
    @kum-yin-lau
    Join Date: 2006
    Post Count: 342

    Hi, Duckster is right. $75 p.w. is not difficult to pay down. Increase payments to $400 per month and it gets progressively easier.

    KY

    Profile photo of john wjohn w
    Member
    @john-w
    Join Date: 2009
    Post Count: 2

    KY,Duckster and Scott, I thank you for taking the time to answer my question.

    Profile photo of newbi2newbi2
    Member
    @newbi2
    Join Date: 2008
    Post Count: 227

    Dont forget to put in context, the time the book was written. Whilst the information is an excellent resource, the market is different now to what it was then. Dont beat yourself up on your purchase. Look at it now and manage it to make it do the best it can.

    Profile photo of god_of_moneygod_of_money
    Participant
    @god_of_money
    Join Date: 2008
    Post Count: 970

    Most of the properties mentioned in the book are in the 'rural' or small town.
    And most of the teories are a bit outdated.

    Profile photo of Stuart GStuart G
    Participant
    @stuart-g
    Join Date: 2008
    Post Count: 4

    Congrats JW on taking action that is something that the majority of the population never does and puts you ahead of the pack. Whilst Steve's books reflect a cash flow positive approach to investing, you really need to go to whoop whoop to achive good positive cash flow, which is obtained at the sacrifice of capital growth.  Most high cash flow posiitve properties are located in or near mining towns and whilst these were excellent investments during the boom times, they reuire extra ue diligence at the moment with the down turn.  Property is generally a get rich slow scheme and there is always a trade off between cash flow and capital growth. A balanced portfolio in my opinion should include a combination of both growth and income. 

    Profile photo of holdandrefinanceholdandrefinance
    Member
    @holdandrefinance
    Join Date: 2004
    Post Count: 38

    its not all doom and gloom.i started out negatively geared but at least i did something !!! i havent lost any money which i would have if i were in super and remember the real money is in capital growth.hang in there and a few years from now you will wonder what all the fuss was about.i only wish i had a place on the gold coast not a bad place to retire

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