Episode 13

When property will work – and when it won’t! Quick tips for property investment

Welcome to Finance and Fury

  • Quick tips to help with making successful investments in property
  • When property will work – and when it won’t!
  • It is two-fold – How well the property works, and then what your own personal situation is like as well

Situations that will work – essentially, doing well in property compared to not doing well

Property

  1. Paying fair value or undervalue for the property – The first step is making sure that you don’t lose from the get go
    • Don’t overpay – New builds can have the FHOG built in
    • Or at least pay the fair value in an area that will grow
    • Remember for a place where land values will go up – The property price will technically go down (remember to watch out for maintenance costs)
  2. Potential zoning and subdivision – future capabilities of the property
    • What is the ability to increase prices?
    • Zoning – growth of land value from high density zoning
    • What are the limits on your ability to change the property?
  3. What is the ability to increase yields?
    • Sub division – 2 incomes for one
    • Duel occupancy

Your situation

  1. Stable cash flows – Don’t get caught out
    • The ability to have long term ownership and maintain payments is important
  2. Can hold for the long term
    • Future plans are important – Property is great for growth – But you have to wait
  3. Limit your outgoing – $50 or $100 p/w – Don’t get in a hole
    • The worst case is to be in a position you are paying more than you earn long term

Situation that won’t work!

The property

  1. The hidden costs – the things that kill the profitability of property
    • Sinking Funds/Body corporates – Seen $6,000 on a place renting for $28,600
  2. Leveraging too high
    1. Price declines can lead to banks increasing your repayments – LVR too high
    2. Interest rate rises – too much debt against value = Bad yields
      • Repayments may be unaffordable if too much debt and rent declines

Your situation

  1. Family/income situation changing
    • Maternity leave or starting a family – Additional costs plus lower incomes
    • Needing to buy a new home for yourself – bank may not lend if existing investment debt
  2. Property is a wealth trap
    • Worst property in best street is a good buy – but not if it is going to cost $300,000 to make it habitable
    • Title searches – Flood zones, major highways (Moving to Brisbane, places in Kenmore)
  3. Negatively geared – with no income to offset or low marginal tax rates
    • MTR of 21% means that 79% is being lost
  4. Loan or ownership structure incorrect
    • Joint owned but one person has no assessable income – bad for deductibility

Thanks for listening!

Furious Fridays: Elon Musk, Tesla and how CEOs affect share price

Furious Fridays Elon Musk, Tesla and how CEOs affect share price Today we’re talking about the markets, how CEOs affect share price and how public perceptions can make or break. We look at Elon Musk. Musk is a business magnate, investor and engineer. He is the...

How to decide if you want to change careers?

Hi Guys, and Welcome to Finance and Fury. Today we continue to talk about investing in yourself. Think about investing in anything, you’re doing something with the aim of gaining something out of it. This is why we went through the purpose and vision statement in the...

History repeats itself – GFC’s, and how the banks and government regulation have impacted financial crashes in the past

Furious Friday History repeats itself - GFC's, and how the banks and government regulation have impacted financial crashes in the past This week we continue with where we left off last week’s episode - is it the Banks, or Government Regulation and interference, that...

How to not get screwed over when buying property

Episode 28 How to not get screwed over in property, the warning signs of scams and how to do your property research Warning signs of scams Off the plan/cold calling companies Buying off-the-plan, or purchasing a property that has yet to be built – The time between the...

(Intro Series) Trusting yourself and learning the basics

Intro - Episode 4 Trusting yourself and learning the basics To start off, do you think that having a map to financial independence would be the ideal solution? Compared to a puzzle it actually would be far better than trying to piece together something, if you could...

When property will work – and when it won’t! Quick tips for property investment

Episode 13 When property will work – and when it won’t! Quick tips for property investment Welcome to Finance and Fury Quick tips to help with making successful investments in property When property will work – and when it won’t! It is two-fold – How well the property...

Commercial v Residential Property; the pros and cons if you’re considering investing

Episode 23 Commercial v Residential Property; the pros and cons if you're considering investing Welcome to Finance and Fury In today’s episode we’re talking about property - Commercial vs Residential. It’s often a question people ask when they’re looking to start...

Furious Friday: The centralisation of power and control of the economy

Furious Fridays The centralisation of power and control of the economy Last Friday we looked at the stock market crashes of 1907 and 2008 Difference between them was the crash of 1907 had no intervention by any central bank in the USA – because no central bank...

Take control of your money – nobody else is going to do it for you

Episode 30 Take control of your money - nobody else is going to do it for you Welcome to Finance & Fury! On today’s episode we take look at the best ways to secure your financial future I’m going to share the rules I follow – And how to not be a victim It isn’t...

Why has Telstra tanked? Is it a good time to buy, or sell?

Say What Wednesdays Why has Telstra tanked? Is it a good time to buy, or sell? Why has Telstra tanked? For so long, Telstra has been a Market Darling … a great dividend-paying share, almost like the world’s best term deposit…but what has happened? They are out of...

Pin It on Pinterest

Share This