Browse Forums Real Estate 1 Dec 03, 2010 5:55 pm I posted this on Somersoft as well, as that is the extent of my disgust! lol The partially renovated apartment in our building sold 2 weeks ago after being on the market for 3 months. Sold for $337,500. They paid $309,000 for it in 2007, a year before we bought our place. We bought our's (ground floor, unrenovated) for $337,000 in May 2008. So...basically, if their RENOVATED, TOP FLOOR (views) can only get now, 2.5 years after we bought our place, the SAME money we paid for our's...well, it just SUCKS! How the hell did I become a senior member!? I know nothing! The Gold Coast Property Market is Very Sad Indeed 2Dec 03, 2010 6:47 pm Unfortunately Grace that is the property game. Sometimes you win sometimes you lose. We have been lucky with our investments but then we have never seen property as a short term option. Every property we have owned has been for a minimum of seven years and those we have unsold one tripled and the other quadrupled in that time. Some things are worth waiting for. Re: The Gold Coast Property Market is Very Sad Indeed 3Dec 04, 2010 10:26 pm I just don't get how anyone can afford to have more than one property and one loan. I really don't. I know I've really got no idea, but the way I see it is... You own 2 properties, and you EARN from them... - The rental income from the one you don't live in (example - $330 p/w) You SPEND on them... - Mortgage on the place you live (example - $450 p/w) - Mortgage on the place you rent out (example - $400 p/w) - Body corporate fees on both (example - $100 p/w in total) - Council rates for both (example - $80 p/w in total) Plus obviously maintenance and unexpected things, etc. So your total EXPENDITURE is $1,030.00. Compared to your rental income of $330?? WHAT THE HELL IS THAT!? How can anyone do that? Tell me what I'm missing here, cause it's clearly a LOT! lol (The above is based on a real scenario. We pay currently $415 a week on our loan for our place. The rent we could get is around $330-$340 a week. We pay $55 a week body corporate and $40 a week council rates. A place we loved and wanted to buy would've had loan repayments of around $450 a week, a body corporate of $35 and rates of $30 a week...so roughly what I said above) And the way I see it, the more investment properties you have, the worse it gets! Cause then you'd be spending more and more on loans, more and more on body corporates and rates, and only getting a fraction back in the rental income! People mention tax offsets and stuff, but I don't see how that can counteract (to the point of making a PROFIT) the above thing I said...$330 income vs $1,030 expenditure per week. You know??? And it's also not just that the people who somehow make this work own MORE of their property (have paid off more or something), cause I know many people buy a place, live in it for 2 years and then move out, buy a new place and rent the old one out. BUT HOW!??!?! How the hell did I become a senior member!? I know nothing! Re: The Gold Coast Property Market is Very Sad Indeed 4Dec 04, 2010 10:50 pm Im getting a little lost following all your points Grace - but we owned a home for about 14 years and then bought an investment property using the equity in residential home. We then owned both for about another 6 years before selling both, partly to fund new build and partly for other reasons.(Not financial ones) The unit was semi-detached - ie one common wall with adjoining property - but both house and unit were Torrrens title properties, there were no corporate body fees - the rent pretty well covered the mortgage payments and payments on first house were relatively low by then - this always happens if you buy a house, payments stay the same but inflation means in real terms they go down, plus we had paid extra payments for all but the first couple of years. Yes, we were a bit out of pocket when you factor in council rates, maitenance etc but we made sure we could afford this when we took it on, and they are tax deductible. When we sold the unit , it had well over doubled in value and the tenants had paid most of mortgage for us - of course we paid capital gains tax, but were well in front overall. Yes, DH and I both had steady permanant employment throughout this time but by no means on large incomes. I guess we were buying in country area so capital outlay wasnt as great but principle is the same. Not sure if this is answering your question but hope it has been relevant. The Gold Coast Property Market is Very Sad Indeed 5Dec 04, 2010 11:00 pm We have three rental properties as well as our owner occ property. Yes we have mortgages / rates / insurances / land taxes but over a long term they will pay themselves off with the rental plus some extra input from us. They will also (fingers crossed) increase in value over a LONG period of time. We ensure we have good tenants who pay good rental. We also ensure that we can afford any expenses should the property be empty for any length of time. I suppose it just comes down to your income and priorities. Our number 1 priority especially as self employed people is to ensure that we have a dependable and longterm investment strategy that in the future may also assist our children. They ain't making any more land LOL so we are buying what we can afford now. Some things are worth waiting for. Re: The Gold Coast Property Market is Very Sad Indeed 6Dec 05, 2010 1:06 am It's called negative gearing. You can tax deduct expenses. One normally only borrows approximately 10x the annual rental return with remainder as capital input from yourself. If you have no idea of this put your investment money in something else. Re: The Gold Coast Property Market is Very Sad Indeed 7Dec 05, 2010 12:43 pm Grace using your example is why thousands of people only buy one investment property. And also why most sell it within a few years and lose money. If you want to go beyond one property you need to have a clearly defined plan. By buying hugely negatively geared properties you are restricted by the amount of money you earn. My plan is to replace my income. Not to become a slave to it. When you take out a loan you pay interest only. Also all costs are tax deductible. Plus you claim depreciation which puts more money back in your pocket. I'm not into negatively geared property and aim to get them at least CF neutral as quick as possible. You do that by buying under market value and renovating which gives you instant equity AND better rent. My last one costs me nothing out of my pocket and I increased $50K after a 5 week reno. I only buy if I can get my money back straight away (by renovating and revaluing). That way I can use that money again to buy the next one. Re: The Gold Coast Property Market is Very Sad Indeed 8Dec 05, 2010 1:15 pm grace_slick I just don't get how anyone can afford to have more than one property and one loan. I really don't. I'd hazard a guess and say a good income and sound investment strategy has A LOT to do with it. Re: The Gold Coast Property Market is Very Sad Indeed 9Dec 05, 2010 3:47 pm Eve Dweller It's called negative gearing. You can tax deduct expenses. One normally only borrows approximately 10x the annual rental return with remainder as capital input from yourself. If you have no idea of this put your investment money in something else. Oh, I'm not buying an investment property any time soon. Was just wondering, as IDEALLY we'd keep our place we're in until the prices go up, but we want to live elsewhere. But we can't afford to own 2 properties. Wow, there's no way we could borrow only 10x the annual rental return...that'd only be about $170,000. We'd need twice that to afford a place to live in whilst keeping our current place as the rental. How the hell did I become a senior member!? I know nothing! Re: The Gold Coast Property Market is Very Sad Indeed 10Dec 05, 2010 3:50 pm Yeah, our incomes are no good. I earn basically per week what my loan repayments would be if I owned 2 properties and had loans for both. That's it. My entire income gone just on that, and that IS interest only!! No principle paid off at all. And travelbug, I'm with you. That is the only way I would be happy having investment properties. I'd buy cheap ones that you could do a fair amount of not too expensive work too that make a big difference, and then sell 'em. How the hell did I become a senior member!? I know nothing! Re: The Gold Coast Property Market is Very Sad Indeed 11Dec 06, 2010 5:30 pm grace_slick Yeah, our incomes are no good. I earn basically per week what my loan repayments would be if I owned 2 properties and had loans for both. That's it. My entire income gone just on that, and that IS interest only!! No principle paid off at all. And travelbug, I'm with you. That is the only way I would be happy having investment properties. I'd buy cheap ones that you could do a fair amount of not too expensive work too that make a big difference, and then sell 'em. Nah don't sell, that's short term thinking. I want to retire soon and live off my properties. The $20K you make in the short term will be nothing compared to the money you make keeping it for the long term. Just pull out the extra equity and buy another one. Repeat, repeat, repeat. Re: The Gold Coast Property Market is Very Sad Indeed 12Dec 07, 2010 8:18 pm Equity. I don't care much for that word right now. We have NO equity...2.5 years and we have nothing to show for it. *sigh* How the hell did I become a senior member!? I know nothing! Re: The Gold Coast Property Market is Very Sad Indeed 13Dec 09, 2010 10:50 am Eve Dweller It's called negative gearing. You can tax deduct expenses. One normally only borrows approximately 10x the annual rental return with remainder as capital input from yourself. If you have no idea of this put your investment money in something else. Well said, Negative gearing means you are making a loss which means you are out of pocket. Then hoping for capital growth to cover these losses is where you get yourself into trouble. Real estate investment is pretty tough in the bigger cites/towns the only real money now is in development/subdivison unless your in the trade. Re: The Gold Coast Property Market is Very Sad Indeed 14Dec 09, 2010 5:21 pm BeatrixKiddo Real estate investment is pretty tough in the bigger cites/towns the only real money now is in development/subdivison unless your in the trade. Not from where I'm sitting. Increased my equity by $200K in the last 2 years. 90% in Sydney. Last purchase (August this year) increased equity of $50K. Re: The Gold Coast Property Market is Very Sad Indeed 15Dec 09, 2010 6:46 pm Same as our area Travelbug - and we are not in a capital city but Newcastle is still growing steadily and upwards. Again as I said before property is not a quick investment in most cases - you should be looking at a slow and steady growth for sustained investment. Some things are worth waiting for. Re: The Gold Coast Property Market is Very Sad Indeed 16Dec 10, 2010 3:57 pm Wow, I wish we'd had ANY increase in the past 2.5 years. This is what I'm annoyed about. I see these places going up, and feel frustrated and like, was I supposed to expect things to NOT go up even 1% in the time other places have gone up by $200k?? How the hell did I become a senior member!? I know nothing! Re: The Gold Coast Property Market is Very Sad Indeed 17Dec 10, 2010 6:44 pm Everything works in cycles. A lot of people that bought in Sydney in 2003 have seen very little growth in 7 years in some areas. I've seen properties sell for less than owners paid 5 years previously. Re: The Gold Coast Property Market is Very Sad Indeed 18Dec 11, 2010 3:48 pm I'm from the Gold Coast and we sold our last house for a reasonable price but not what we could have got a few years ago. We had it built in 1992 and would nowhere near have even got our money back for quite a few years and that will probably be the case with our new place. We have toyed with the idea of an investment property but in the end you have to pay too much on the Gold Coast for what you get in rent. I suppose it's OK if you don't have much of a loan but we are just not in that position. We ended up investing in shares instead - you can just keep building up slowly instead of having to go in with a huge sum at the start - but of course that also has not been too fantastic recently. The value dropped a lot with the GFC but since we haven't sold then we will just wait it out and keep our fingers crossed. Both forms of investment IMO rely on you not having to sell at a "down" time in the market. Re: The Gold Coast Property Market is Very Sad Indeed 19Dec 13, 2010 3:33 pm travelbug BeatrixKiddo Real estate investment is pretty tough in the bigger cites/towns the only real money now is in development/subdivison unless your in the trade. Not from where I'm sitting. Increased my equity by $200K in the last 2 years. 90% in Sydney. Last purchase (August this year) increased equity of $50K. Sure its possible for you, but the average punter just been told just to buy a place (mortgage to the eye balls) and watch it grow is going to be quite unhappy for a bit. Take into account the losses you make, the cash outlay, outgoings and property is not the easy investment it used to be. That's why developing and subdividing has greater returns atm. Re: The Gold Coast Property Market is Very Sad Indeed 20Dec 13, 2010 4:31 pm BeatrixKiddo travelbug BeatrixKiddo Real estate investment is pretty tough in the bigger cites/towns the only real money now is in development/subdivison unless your in the trade. Not from where I'm sitting. Increased my equity by $200K in the last 2 years. 90% in Sydney. Last purchase (August this year) increased equity of $50K. Sure its possible for you, but the average punter just been told just to buy a place (mortgage to the eye balls) and watch it grow is going to be quite unhappy for a bit. Take into account the losses you make, the cash outlay, outgoings and property is not the easy investment it used to be. That's why developing and subdividing has greater returns atm. Developing and subdivising has greater returns, I agree. But my recent purchase costs me nothing to hold (what losses?) and will even net a return after depreciation and with the increased equity via the reno, even if values slip a bit I'm still ahead. It's a matter of education and research. I agree that it's not easy but I wouldn't say it's any harder than it has always been. Hi - thanks for your reply. Yes I think 'Ill go for whitish with very speckly bits rather than pure white something like this. PS was actually 2008 I built the… 2 11631 Anybody know any good and reasonably priced Air conditioning contractors/companies that could install a ducted air conditioning system in the Central Coast NSW for a small… 0 8898 You might be able to apply to divert the sewer at your expense. In NSW you would contact a Water services co-ordinator and they would give you advice as to whether or not… 1 16102 |