Investment property (18)
kizzy27: I am thinking about buying my first investment property, dwhat are the downfalls , is now a good time/ Im not after instant return but ide like it to cover its own intrest and maintanence, what do I need to be wary off?
any input appriciated
any input appriciated
If you are looking outside of a capital city, prices are lower and generally stay lower and only rise very slowly. It will need to be a long-term investment. Unless it is a popular area, 5 years may only see it break even after legals, agents fees, selling fees, taxes and rates are taken out. And Capital Gains Tax when you finally sell it.
The ones my family and I have invested in required work and it was the improvements that made the difference in price. Sometimes you can be lucky and get something just as the market is rising. Market is slow at the moment and you could probably get something at a reasonable price.
If you are thinking about Qld, I know many people that have lost lots of money buying units around the Gold Coast. You need to be very careful with those ones.
You need to look at what rentals are generally available in the area and what they are going for, is there a short supply (which means you have a good chance of continuous tenancies - lots of vacancies may mean you receive no income for long periods), what maintenance would be expected during the time you own it and will it exceed your returns.
A good rule of thumb for how much to borrow is that the nett rental return is at least 10% more than your repayments. Don't forget that real estate agents want their cut as well and this could be 7-10% of the rent.
The big thing to be wary of is that you are a woman. Expect real estate salesmen to play on that and spark it up a lot more than it really is worth and gloss over the faults. Before signing anything, check out similar properties in the area (and usually discount the advertised value at least 10%), how long has that property been on the market (some around Warragul have been on the boards for nearly a year), get a pest report and get a reputable builder to go over it - they cost but well worth it in the long run.
kizzy27: I am thinking about buying my first investment property, dwhat are the downfalls , is now a good time/ Im not after instant return but ide like it to cover its own intrest and maintanence, what do I need to be wary off?
any input appriciated
any input appriciated
If you are going to rent the property be very very careful.The more you spend on it the better type of person you will get.
If it is close to the beach you can make a lot of money renting to holiday makers.
Funny thing is a lot of landlords/ladies are now renting with pets allowed, its a win win situation as most who want to bring there pets with them on holiday are good people ...when we rented in Victor Habour SA
we payed a surcharge of $5 dollers a day each dog.
It was a nice place but it cost $160 a day plus two dogs.Oh and about 5min to beach.
Just a thought.
kizzy27: I am thinking about buying my first investment property, dwhat are the downfalls , is now a good time/ Im not after instant return but ide like it to cover its own intrest and maintanence, what do I need to be wary off?
any input appriciated
any input appriciated
As an accountant and a sometimes dabbler with financial services, my best advise is to tell you to get “Qualified Informed Advise” …
There are many areas here you need to cover and even the type of loan you may use … i.e. Principal Only ?? … Rates … Loan termination penalties, many, many, many hidden catch outs .. and that’s just in arranging the finance ..
Then things like where is the property, capital growth, rental market, fixed costs, like what types of insurance cover and most of all the eXtent of the coverage, taxation liabilities etc … it just goes on and on and on and on
Get Professional Advise …. Do yourself this one favor …
Cheers and good luck to you … great way to secure a viable financial future if you can do it …
Oh how wonderful my my RSL lottery tickets turned up today, i might win a lovely four story house house right on the beach on the Gold Coast, oh i'm so pleased my tickets have now turned, whippy, i suppose i should look an what the ticket says i will get, the good news is the Body Corporate and Rates are paid for 12 months, (non transferable) oh dear, $16,290 oh whippy the annual rates and body corp, whippy
You might like to check this out Kizzy
Commonwealth Bank Market Indicator You put the suburb or town in and it generates what the Commonwealth B think is happening in that area
The commentary below offers a snapshot of your chosen city and the Market indicator shows what the current demand and supply for houses and units is in your city.
This City is in:
Extreme Buyer's Market
The balance of loan funding to properties advertised for sale shows significantly more stock on the market than demonstrated demand. Competition amongst buyers for housing stock is likely to be low. Buyers should have a great deal of leverage in this market and be able to negotiate aggressively on the purchase price.
Commonwealth Bank Market Indicator You put the suburb or town in and it generates what the Commonwealth B think is happening in that area
The commentary below offers a snapshot of your chosen city and the Market indicator shows what the current demand and supply for houses and units is in your city.
This City is in:
Extreme Buyer's Market
The balance of loan funding to properties advertised for sale shows significantly more stock on the market than demonstrated demand. Competition amongst buyers for housing stock is likely to be low. Buyers should have a great deal of leverage in this market and be able to negotiate aggressively on the purchase price.
robplum: You might like to check this out Kizzy
Commonwealth Bank Market Indicator You put the suburb or town in and it generates what the Commonwealth B think is happening in that area
The commentary below offers a snapshot of your chosen city and the Market indicator shows what the current demand and supply for houses and units is in your city.
This City is in:
Extreme Buyer's Market
The balance of loan funding to properties advertised for sale shows significantly more stock on the market than demonstrated demand. Competition amongst buyers for housing stock is likely to be low. Buyers should have a great deal of leverage in this market and be able to negotiate aggressively on the purchase price.
Commonwealth Bank Market Indicator You put the suburb or town in and it generates what the Commonwealth B think is happening in that area
The commentary below offers a snapshot of your chosen city and the Market indicator shows what the current demand and supply for houses and units is in your city.
This City is in:
Extreme Buyer's Market
The balance of loan funding to properties advertised for sale shows significantly more stock on the market than demonstrated demand. Competition amongst buyers for housing stock is likely to be low. Buyers should have a great deal of leverage in this market and be able to negotiate aggressively on the purchase price.
Very much so. With so much new housing going on the market over the last few years, we are going to see the trend of the late 90s happening again. Many people are jumping into the homeowner market with the First Home Owners Grant, delayed settlement, reduced payments for the 1st year or so, "repayments the same as renting" (forget the other expenses), increasing unemployment.
The uncertainty of the financial market means that you have to be very careful. Even a change of Govt now would not stave off the uncertainty of the market. Any half decent financial adviser will take you through this. It might cost you a bit for their advice but it will be worth it in the long run. And if you have the readys, you are in a pretty good position.
I have been looking at the same myself over the last 2 years. I had an opportunity recently to buy a block of 4 units at $140,000 each renting for about 8% return. When I inspected them, I needed to go outside to have a smoke to clear my lungs because of the mildew.
I was very tempted to offer them about half the price so I could bulldoze them. Then thought about the tenants who obviously couldn't afford anything more and this would be turfing them out with little prospect of finding anything in the area. Yeah, I have a guilt trip about being a slumlord so passed up the chance of making a couple of quick bucks.
kizzy27: I am thinking about buying my first investment property, dwhat are the downfalls , is now a good time/ Im not after instant return but ide like it to cover its own intrest and maintanence, what do I need to be wary off?
any input appriciated
There are no disadvantages there are only cautions. A) make sure you can afford the payments when there is no rent coming in B) make sure you don’t pay for the property more than it can generate in rent. any input appriciated
So much to think about Im ging to see a finacial planner work out what to do Ide like to try an d get an interest only loan move in an fix it up while renting mine then switch back and rent it out covering the loan ...
Thanks for all the imput , im trying to open robs link but no luck loading it ill have a look after work .....
Thanks for all the imput , im trying to open robs link but no luck loading it ill have a look after work .....
Oh, that was a report for Narooma
just use this link Kizzy
and click on whatever you want it to report on, its just a guide
just use this link Kizzy
and click on whatever you want it to report on, its just a guide
Hi. My experience tells me beware the deal that sounds too good....it will not be that!
Stay clear of brand new apartments and units sold by third party property marketers-(normally inflated prices and dont value up). I stick to locating the land first... then sourcing reputable builders (say 2/3) and have general quotes done for your style of house you want. Remember, yes its just an investment vehicle, however it will be yours - not your tenants. So build something YOU would love to live in yourself. (All within budget of course). Hope it helps a little bit. Michael.
Stay clear of brand new apartments and units sold by third party property marketers-(normally inflated prices and dont value up). I stick to locating the land first... then sourcing reputable builders (say 2/3) and have general quotes done for your style of house you want. Remember, yes its just an investment vehicle, however it will be yours - not your tenants. So build something YOU would love to live in yourself. (All within budget of course). Hope it helps a little bit. Michael.
kizzy27: I am thinking about buying my first investment property, dwhat are the downfalls , is now a good time/ Im not after instant return but ide like it to cover its own intrest and maintanence, what do I need to be wary off?
any input appriciated
Yallourn North was the best investment in the property buyers mag. $135,000 gets you a 3 bedroom brick home with a $250 week rental.any input appriciated
can't beat that plus the growth is good too.
If your buying anywhere, 20% off the selling price is the norm. when placing an offer as it's a buyers market, the worst that could happen is the home owner comes back and meets you halfway with 10% off, whatever happens, you're in the drivers seat the way the market has been dropping as the property bubble starts to burst.
I've been lucky with my renters.
daggyone: Yallourn North was the best investment in the property buyers mag. $135,000 gets you a 3 bedroom brick home with a $250 week rental.
can't beat that plus the growth is good too.
If your buying anywhere, 20% off the selling price is the norm. when placing an offer as it's a buyers market, the worst that could happen is the home owner comes back and meets you halfway with 10% off, whatever happens, you're in the drivers seat the way the market has been dropping as the property bubble starts to burst.
I've been lucky with my renters.
can't beat that plus the growth is good too.
If your buying anywhere, 20% off the selling price is the norm. when placing an offer as it's a buyers market, the worst that could happen is the home owner comes back and meets you halfway with 10% off, whatever happens, you're in the drivers seat the way the market has been dropping as the property bubble starts to burst.
I've been lucky with my renters.
Yallourn North??? Why so cheap? Probably because it will be massive unemployment area once the mines and the power station shut down when the carbon tax finally hits. They have brown coal which is easy to mine but oh so dirty. And this power station is first on the hitlist to close.
Once the de-sal plant is finally built, Wonthaggi and surrounds will have plenty of empty houses going cheap, and noone around to rent them.
Look around the local real estate agents, if the rental list is long, it might be hard to get a tenant. A short list usually means there is always someone looking.
Buying a place and living in it while you do it up is a sound proposition. When I was working right in Sydney, I bought a terrace house in close and did it up. Sold it 18 months later for double what I paid for it. Yes, a lot of work involved, basically gutted the place. Although I have seen people spend way too much renovating resulting in minimal return.
Look for something that you can do the work on rather than relying on tradies. Patching cracks and small holes are simple, painting is easy, fresh carpet always helps (doesn't have to be the most expensive), and often a new stove is very good to smarten up a kitchen.
And gardens do make a big difference. When you walk in the yard, no matter how much you still have to do inside, at least you can smile until you open the door.
robplum: Oh how wonderful my my RSL lottery tickets turned up today, i might win a lovely four story house house right on the beach on the Gold Coast, oh i'm so pleased my tickets have now turned, whippy, i suppose i should look an what the ticket says i will get, the good news is the Body Corporate and Rates are paid for 12 months, (non transferable) oh dear, $16,290 oh whippy the annual rates and body corp, whippy
I preffer those Boystown, Lifesavers, RSL type home auctions to Tattslotto as the odds are a lot better that way.wash2u: Yallourn North??? Why so cheap? Probably because it will be massive unemployment area once the mines and the power station shut down when the carbon tax finally hits. They have brown coal which is easy to mine but oh so dirty. And this power station is first on the hitlist to close.
Once the de-sal plant is finally built, Wonthaggi and surrounds will have plenty of empty houses going cheap, and noone around to rent them.
Look around the local real estate agents, if the rental list is long, it might be hard to get a tenant. A short list usually means there is always someone looking.
Buying a place and living in it while you do it up is a sound proposition. When I was working right in Sydney, I bought a terrace house in close and did it up. Sold it 18 months later for double what I paid for it. Yes, a lot of work involved, basically gutted the place. Although I have seen people spend way too much renovating resulting in minimal return.
Look for something that you can do the work on rather than relying on tradies. Patching cracks and small holes are simple, painting is easy, fresh carpet always helps (doesn't have to be the most expensive), and often a new stove is very good to smarten up a kitchen.
And gardens do make a big difference. When you walk in the yard, no matter how much you still have to do inside, at least you can smile until you open the door.
Bit like any 2nd hand market - supply and demandOnce the de-sal plant is finally built, Wonthaggi and surrounds will have plenty of empty houses going cheap, and noone around to rent them.
Look around the local real estate agents, if the rental list is long, it might be hard to get a tenant. A short list usually means there is always someone looking.
Buying a place and living in it while you do it up is a sound proposition. When I was working right in Sydney, I bought a terrace house in close and did it up. Sold it 18 months later for double what I paid for it. Yes, a lot of work involved, basically gutted the place. Although I have seen people spend way too much renovating resulting in minimal return.
Look for something that you can do the work on rather than relying on tradies. Patching cracks and small holes are simple, painting is easy, fresh carpet always helps (doesn't have to be the most expensive), and often a new stove is very good to smarten up a kitchen.
And gardens do make a big difference. When you walk in the yard, no matter how much you still have to do inside, at least you can smile until you open the door.
low supply of the in demand items like units for retirees who don't wish to maintain a large 1/4 acre garden anymore.
Easiest way to rectify this is to move a house onto the back of a block and end up with 2 rental properties or sell one and keep the other.
wash2u: Very much so. With so much new housing going on the market over the last few years, we are going to see the trend of the late 90s happening again. Many people are jumping into the homeowner market with the First Home Owners Grant, delayed settlement, reduced payments for the 1st year or so, "repayments the same as renting" (forget the other expenses), increasing unemployment.
The uncertainty of the financial market means that you have to be very careful. Even a change of Govt now would not stave off the uncertainty of the market. Any half decent financial adviser will take you through this. It might cost you a bit for their advice but it will be worth it in the long run. And if you have the readys, you are in a pretty good position.
I have been looking at the same myself over the last 2 years. I had an opportunity recently to buy a block of 4 units at $140,000 each renting for about 8% return. When I inspected them, I needed to go outside to have a smoke to clear my lungs because of the mildew.
I was very tempted to offer them about half the price so I could bulldoze them. Then thought about the tenants who obviously couldn't afford anything more and this would be turfing them out with little prospect of finding anything in the area. Yeah, I have a guilt trip about being a slumlord so passed up the chance of making a couple of quick bucks.
beauty, i,ll be able to put my rates upThe uncertainty of the financial market means that you have to be very careful. Even a change of Govt now would not stave off the uncertainty of the market. Any half decent financial adviser will take you through this. It might cost you a bit for their advice but it will be worth it in the long run. And if you have the readys, you are in a pretty good position.
I have been looking at the same myself over the last 2 years. I had an opportunity recently to buy a block of 4 units at $140,000 each renting for about 8% return. When I inspected them, I needed to go outside to have a smoke to clear my lungs because of the mildew.
I was very tempted to offer them about half the price so I could bulldoze them. Then thought about the tenants who obviously couldn't afford anything more and this would be turfing them out with little prospect of finding anything in the area. Yeah, I have a guilt trip about being a slumlord so passed up the chance of making a couple of quick bucks.
Howzabout a strata commercial unit in a blue chip part of Adelaide, minutes walking distance to CBD...time for me to let it go.
venere08: Howzabout a strata commercial unit in a blue chip part of Adelaide, minutes walking distance to CBD...time for me to let it go.
Whats the deal? Nothing for sale in Puglia Beach?
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any input appriciated