Your strategy should be based on who your connections are, who your related too, what your good at, this is what makes a good strategy. Not by looking at someone else how they buy all these positive geared properties and so on, they may no realtors from all around, you don’t know.
I have the most ideal strategy for me, and it’s easy to guess when my family owns a building supply.
Your strategy should also change, like the others said, depending area and people in the community, be careful when doing renos because Ive seen a few investors pay a little to much for such simple works.
Have a plan, and remember cement isn’t cheaper buy how many bags you buy, but per ton. A lot of people get confused with this. And if possible buy direct from suppliers, and make a relationship with them.
Maybe you’ll have 3 IP’s and you might find it cheaper buy ‘crunching the numbers’ to buy bulk and use the same product throughout all 3. Little things make a huge difference and also try and save products you don’t use, good off cuts, because you’ll be shocked how much you can lose at the end if your throwing things away like bags cement, bags of sand, quarter ton of sand, 1m x 1m piece of blue board. After calculating how much product you may lay to waste could be vast over 3 years.
I think a few of you out there would sit back and calculate how much product was thrown out, you mite find the number to be enough for minor cosmetics to a bath room.
My 5cents.
It’s not about being anal about it’s bout looking at your losses. I know it’s irrevellant but why do you think dominos has the rings when there making pizzas? If they didn’t? Calculate a handful of cheese lost across all there stores.
scotty8911 wrote:Hello everyone, thanks again to all your advice and suggestions. I have another question. I have been considering taking on the strategy of reno's. Mainly due to the fact that I am in the trade industry myself, and have a few close friends who are too. Is it wise to think that I can buy a investment property that is in need of renovation, carry out the work within a set time frame and budget, then I can rent this out and charge a premium rent? (looking to obtain CF+ from the property) SO, I guess my question is, can you buy a property, renovate, then expect a positive cashflow? Thanks in advance for your input.Yes it can be a good strategy. It does tend to be in fashion now so be careful of properties that need a reno but people overpay thinking they can make big money when in reality they could have bought a much better house with the work already done for a little more.
With all my purchases they must be under market value. With reno's I must be able to do it in under a month and get at least $4 (in extra equity) for every $1 I spend. We do a lot of the work ourselves. I only buy if I could do the reno and sell straight away with $20K min profit (clear- after tax). Not that I sell but I like numbers and those figures make me happy. It makes it easy to eliminate lots of properties. Of course area is the first decision.
It also like it to be CF neutral (before tax benefits). So likely CF+. Doing a good (but not expensive) reno gives you the increased yield you need to make it work. Newly reno'ed properties give you the yield plus the pick of the tenants.
In the end it's a numbers game. I don't care if it's a house, unit, townhouse. I "just" want equity, CG + yield.
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