Hi! I'm new here, my situation

[sash]

Congratulations Investor2009...you have taken action at a very early age. I for one did not do that till my early 30s....

Out of curiosity can you tell us where your properties are?

I have 11 properties (sold 2 in the last 18 months).....but have about the same amount of debt as you but am CF+ by over $900pw.

Ethernit & Nathan are another young guys who have grown their portfolios quickly.

Well I'll take that as a compliment

I have fixed 50% of my loans, one at 7% and one at 6.8%

I'm variable with the rest.

35% growth, maybe I got 'lucky' I don't see it that way though.
Please don't insult me.. I may just be 'wiser' than you. It does not matter how many years I've been investing. I've spent many years learning and most of my spare time.

I'm going to start capitalising interest soon, as I have some grand plans for for my private residence.

My deals were quite hard to get through, but I never say die. I'm tough. Where theres a will, theres a way.

Low interest rates have been my saviour so far in terms of loans.

Anyhow. Thanks for the replies but the doom n gloom brigade are ******* me off now and I know better than to hand around clowns

 

[JIT]

I have fixed 50% of my loans, one at 7% and one at 6.8%

That's good, similar to what I've done.

I'm going to start capitalising interest soon, as I have some grand plans for for my private residence.

Sounds good.

Do you capitalise the negative gearing shortfall too using a LOC?

My deals were quite hard to get through

Did you do 90-97% LVR deals, and on full doc?

Where abouts are your properties, inner city, outer subs etc.?

Low interest rates have been my saviour so far in terms of loans.

Do you mean the low rates have saved your serviceability or have helped you get more loans?

Sorry for all the questions, but it's interesting to learn how others have built up their portfolios so quickly.

I've done similar to you, but with more gross holdings and debt, and on a much higher income over 4-5 years... and it wasn't easy, particularly in the last 2 years trying to get funding, so I'm interested in how you reached this scale on the kind of income you describe.

Thanks,

 

[VYBerlinaV8]

Watching this thread with great interest. When the details come out this will be very interesting indeed.

 

[fokas]

Watching this thread with great interest. When the details come out this will be very interesting indeed.

IF the OP hasn't been scared away.

 

[crc_error]

it is possible to buy 4 IP's in a short period of time..

I did it back in 2000 - 2003. purchased 3 IP's, $800k debt..

What I did was buy, renovate, redraw, buy next renovate and redraw again..

I borrowed 90% each time..

however towards the 3rd IP, I was earning like $70k PA contracting in IT which helped get the loans through..

we used multipal mortguage insurers for each IP.

So although I congratulate the OP for his effort, I think he might be in for a suprise once rates rise..

I was outa pocked $35kPA in 2005 when rates went up, and was forced to sell.

using growth to fund expenses is unlikely to work, unless you have income to support the loans, and I would suspect the OP would be at his servicability now. The only way I see these loans going through would be with low-doc or no-doc loans, and obviously this will come at a cost.

I still havent had my question answered on what type of IP's the OP holds..

I would say they are probably furnished apartments, and he also would have done some renos.

I would question the type of growth potential in apartments.. as my two apartments in St Kilda and south yarra had poor growth, and these are considered premium suburbs in melbourne.. but its not to say some luck could run your way

 

[crc_error]

I have 11 properties (sold 2 in the last 18 months).....but have about the same amount of debt as you but am CF+ by over $900pw.

where are your IP's and how did you get them, and over what period?

 

[JIT]

it is possible to buy 4 IP's in a short period of time..

I did it back in 2000 - 2003. purchased 3 IP's, $800k debt..

Yes, the OP does remind me of you crc, even in his/her tone!

I would say they are probably furnished apartments, and he also would have done some renos.

Yes, that's quite possible.

 

[crc_error]

Yes, the OP does remind me of you crc, even in his/her tone!



.

lol, I hope thats a good thing

 

[sash]

Spread around the nation....Sydney, Melbourne, Adelaide, and Brisbane.

I have been banging away for about 10 years. I just kept buying....bought a coupled for 90-112K, one for 130K, couple for 163-190k, and a two between 235-252k.

My debt levels are comparatively low...it was under 25%....have gone to 33as a result of recent acquisitions.

As I have said in a couple of theads I am conservative and have fixed rates whilst low, kept large cash supluses in offsets, sold properties to lock in profits or sell them due to them underperforming.

It has really worked well for me. Wish I could say the same for me on shares....but that is changing particularly over the last few months.

where are your IP's and how did you get them, and over what period?

 

[crc_error]

thats great sash! did you do any renos?

I take it your buying apartments?

 

[sash]

Just three major renos...all done for between 7k and 11K.

Mostly houses now (8) now only have 3 apartments.

In case you are worried about land tax....I pay a princely some of just under $800 per year.

thats great sash! did you do any renos?

I take it your buying apartments?

 

[crc_error]

that is a very good portfolio.. houses are the way to go for CG..

and you bought them all in 10 years? how did you get your deposits, and address the holding shortfall?

 

[sash]

Mostly from excess from my salary and excess from savings.

There was not shortfalls or it was minimal (i.e. $20pw) as I tend to buy for CF or fund properties through excess cashflow.

For example I had over $1000 pw CF+ till this bought 2 properties which were about $50pw CF-. ...thus now I only have $900pw CF+.

The onces I have bought since 2005 have had CG of at least 50%....so I am chuffed. The more recent buys..i.e. this year have also done about 15-25%...though one of these I did a reno.

that is a very good portfolio.. houses are the way to go for CG..

and you bought them all in 10 years? how did you get your deposits, and address the holding shortfall?

 

[jingo]

I would question the type of growth potential in apartments.. as my two apartments in St Kilda and south yarra had poor growth, and these are considered premium suburbs in melbourne..

Hi crc,

Older style flats/apartments are going gangbusters at the moment in Melbourne. Anything with 2 bedrooms and a carspace is hot property. The trick is to ensure that a flat or apartment has at least 30% land component, and is in a low rise (ie no more than 3 levels, including ground floor).
FHB's love them, and renovate them to a high standard.

Regards Jason.

 

[investor2009]

LMAO

Are you kidding?

I'm ready to borrow more, and the Banks are willing to lend.
Being from Tassie I suspect you're accustomed to low level thinking, in terms of $$$'s, because everything is cheap down your way.

My advice. You may need to think a little bigger if you ever aim to get anything out of this game. But its your life, you do what you will

So it seems there are a few sceptics on the whole equity redraw thing, and I see where they're coming from.

This has had me thinking to. I have come to realise that in a worst case scenario I could simply sell a dwelling, buy another one, and live on that for a few years, repeat.

Or, put my money into higher yielding property/ies.

Or, commercial deals?

There are many things to consider, and I love that thought.
I could utilise a mix of strategies.

Things do change over the long term and I'll keep looking at the bigger picture along the way.

My aim is to be living the life I want within 3 years though. And I will achieve that. I don't want to be the old guy who hoards his riches. Life is for living, and I've worked too hard, for too many years to stray from this path. It's my hobby.

I enjoy investing, and I'm prepared to do it tough for a little while longer if it means shaving decades off my working life.

I'm the sort who prefers to accumulate sooner rather than later, because I get to reap the growth from doing so.

But what if rates rise? Ohh boo hoo, capitalise interest.

And to the dude who doesn't believe my growth figures.
I don't know where you've been investing but it might pay to take a look at what you're buying.

Adios.

Totally agree with you Bill.L.

How can someone possibly have 4 properties, get this amount of growth and equity at 25yrs old on a low income, without a tremendous amount of help financially. Geez there are are PM fees, insurance, land tax etc which all add up to about 20% plus of costs then loans, accountant fees, tennants not paying rent (insurance does not cover 100% of this, there is an excess!! if they pay).

Then theres the banks!!! Which bank is going to lend a 25yr old this much money on a low income!!!!

I smell a Rat??

 

[crc_error]

But what if rates rise? Ohh boo hoo, capitalise interest.
.

We will see if the banks accept capitalizing interest as a form of income to secure more credit..

good luck...

 

[JIT]

So it seems there are a few sceptics on the whole equity redraw thing, and I see where they're coming from...

...

But what if rates rise? Ohh boo hoo, capitalise interest.

So your IP's went up in value, you took out a LOC/redraw facility, using it to capitalise some/all of your shortfall, and relying on uncertain future CG and bank lending policy/valuations to get you to financial freedom...

Sounds like a great plan.

Best wishes.

 

[investor2009]

When you apply for finance, do YOU tell them what you will be using the funds for?

I don't.

I have had one of my banks call me on a number of occasions asking if I would like to up my credit on loans.

That tells me something..

Credit crisis, really?

Just saying.

We will see if the banks accept capitalizing interest as a form of income to secure more credit..

good luck...

 

[investor2009]

What would you do, sell up?...
I recommend the book

'wealth for life' its a good read.

Also, if you look at many investment gurus, many will state that equity is the key to wealth.
I agree. Why invest if you're not going to use the money?

I'm leaving now, just thought there may be some interesting things I could learn here but I'm sure I'm way ahead of most here.

ciao. And happy investing, I wish you all the best

So your IP's went up in value, you took out a LOC/redraw facility, using it to capitalise some/all of your shortfall, and relying on uncertain future CG and bank lending policy/valuations to get you to financial freedom...

Sounds like a great plan.

Best wishes.

 

[JIT]

What would you do, sell up?...
I recommend the book

'wealth for life' its a good read.

So I'm right about your strategy then!