Hi all
im preparing for a big year next year and have been doing research
looking at alot of properties.
i have been doing some numbers and the properties all look like cash eaters rather then postive providera
betime you pay stamp duty you are left out of pocketis this a common thing at the moment
rather then borrowing 250k for a home that returns –
why not use money to buy a bussiness
if any one can show me a way to either return a postive or a break even that would he great
i have been reading steves books and i am pumpes up and hungary again but like he points out you need to get that makes.you.moneyJpcashflow | JP Financial Group
http://www.jpfinancialgroup.com.au
Email Me | Phone MeYour first port of call in finance :)
I noticed the same thing when looking for property around Brisbane, however when I attended the property it was a different story, agents and sellers can’t seem to get their head around the “not a great market for sellers”
Properties around the 460 mark are selling for around for around 360-70.
With a LVR of 90% some minor work and self managed I believe these could come close to Neutral, Esp with an IO rate at the moment.
I work in IT and as a result have exposure to quite a range of businesses and their inner workings, there is no way i’d buy a business.
I’ve seen many a client we have go bankrupt and a couple just before Christmas, Sure there can be rewards if all is done right and the business plays to the current market.
My Parents own a business and I swear its taken years off their lives.Jpcashflow wrote:Hi all im preparing for a big year next year and have been doing research looking at alot of properties. i have been doing some numbers and the properties all look like cash eaters rather then postive providera betime you pay stamp duty you are left out of pocket is this a common thing at the moment rather then borrowing 250k for a home that returns – why not use money to buy a bussiness if any one can show me a way to either return a postive or a break even that would he great i have been reading steves books and i am pumpes up and hungary again but like he points out you need to get that makes.you.moneyHi Johann,
I'd say keep looking, keep researching and/or looking in other areas. You may also be able to negotiate a significant price discount in this market with houseprices dropping and many places passing in at auction. If you are able to purchase a place below market rates and add some value via a renovation (paint job, replace carpets or bathroom/kitchen or larger scale extension) then you may be able to artifically raise the rent which will also improve your yields.
Happy hunting.
Hi Johann
We overcome the challenge you've described by buying property and on-selling it with vendor finance (VF). We have been doing this since 2003 and are now in a position where the positive cash flow from these properties now supports our lifestyle and our traditional buy and hold portfolio,
Sure, we do lose the long term capital growth from the properties we on-sell with VF but we are able to lock in a fixed capital gain with these properties and the positive monthly cash flow helps to build our real wealth, i.e. the equity we have in our buy and holds portfolio.
You mentioned that it may be better to go out and buy a business. This is effectively what we've done, i.e. we've built a cash flow business trading property.
I'd suggest you do a bit of research on the subject. A good place to start is a search for 'vendor finance' on this forum.
Cheers, Paul
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
hi paul
ive been reading on this will talk to you soon about thisJpcashflow | JP Financial Group
http://www.jpfinancialgroup.com.au
Email Me | Phone MeYour first port of call in finance :)
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