23 properties in 5 years

Congratulations Karina, excellent work. I am wondering what your current LVG % position is and are you looking to increase or decrease your LVR in the current market ? Perhaps someone else can answer if this has previously been answered. Thanks in advance
 
Hi Stingray,

I know Karina's LVR but no way am I going to post that on an open forum. That's her private business and only she should divulge it to others at her discretion. I'd advise against it.

Why all the focus on other individual's LVRs at present. You PM'd me asking my LVR recently too. I'm not worried by any PMs but you know I didn't supply it in response.

Just wondering why the focus on LVR? Is it to help your strategy somehow, or just idle interest...

Not trying to be negative, just trying to understand motive?

Cheers,
Michael
 
Michael,
I would have thought that most PI's would openly share eachother's LVR %. We are all here to help each other out and to learn about other people's thoughts. I don't see why you are making such a big deal of it. I believe LVG % positions are very important in the current market, although others may not agree and I respect them for that.
 
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Great post Karina. Very inspoirational and a great example for all to follow re; mindset, commitment and belief.

What's on the plate for the next few years?
 
As the others have said, fantastic thread Karina...

Quick question if that's ok...

Out of interest... how do you find the stress level of owning this many IPs?

How often would you say you are having to deal with issues concerning you portfolio (ie once a week/month etc)?

Is it something that you've got used to over time?

Thanks again so much for sharing your journey. It's rare opportunity to be able to hear from someone who's had the determination to get to where you are...

Rory :)
 
Ar Jay

You dont stress about problems with the portfolio ... trust me you pay some else to look after this.

We employ a full time person to do everything on ours and get a weekly consolidated report about everything from rent received to maintenance issues.

If you do everything yourself and YES i have done that you go mad.
 
In answer to some of the questions

How often do I get stressed. That's a great question. It varies, everyday issues tend not to stress me too much, by that I mean vacancy , tenants moving out, repairs , late payers. I guess its becuase I have a plan in place to deal with them. By having available funds to draw down on this reduces the stress when these issues arise, as long as the funds are there to cover expenses I tend to sleep ok at night. Also landlords insurance covers the malicous damage, non payment issues to some extent. Insurance companies don't cover everything and you are up for excess etc.

Interest rate rises were stressful as I could see expenses increasing dramatically but luckily now that is happening in reverse with the rate cuts.

Also the global financial markets have been something concerning as I don't really know what is ahead but I am trying to keep my cool and just ride out this uncertain period and concentrate on improving cashflow.

whats planned for the next few years?
basically I want to focus on improving cashflow and getting the portfolio to a stage where it generates income for me to live off (cashflow positive) I just need to give it time. In order to achieve that though I need to stop buying and allow rents to overtake my expenses. I am also becoming more interested in the share market as prices have fallen dramatically and I think its a good time to buy a few shares for the long term (again concentrating on cashflow positive shares only) I am done with negative gearing for now.

Once the cashflow improves I'll look at adding to the portfolio but I think its unlikely I will buy in the next 12 months. Not due to the market but more my personal situation.
 
In answer to some of the questions

How often do I get stressed. That's a great question. It varies, everyday issues tend not to stress me too much, by that I mean vacancy , tenants moving out, repairs , late payers. I guess its becuase I have a plan in place to deal with them. By having available funds to draw down on this reduces the stress when these issues arise, as long as the funds are there to cover expenses I tend to sleep ok at night. Also landlords insurance covers the malicous damage, non payment issues to some extent. Insurance companies don't cover everything and you are up for excess etc.

Interest rate rises were stressful as I could see expenses increasing dramatically but luckily now that is happening in reverse with the rate cuts.

Also the global financial markets have been something concerning as I don't really know what is ahead but I am trying to keep my cool and just ride out this uncertain period and concentrate on improving cashflow.

Thanks Karina.

Can I also ask...
As rates increased how did you "survive"? Did you have a LOC in place?
Will you be fixing as rates come down?

One last one if that's ok...
Have your views on +CF versus -CF changed at all over the years?
Would you still take the same path if you were starting again from scratch?

Again, many thanks.
Rory :)
 
Well done...I especially like the fact that a lot of negatives were thrown at you about your initial purchases, yet you stayed positive and you've won...good stuff...:):):)
 
wasn't too sure whether I should start another thread, so i hope i haven't hijacked this thread.

we've heard the good work and efforts of Karina, and it has been an inspiration for many including me.

there has been a lot of discussion on how to replicate that now, many have said it is more difficult now, some say impossible, which I am sure there is some degree of truth to it....

so I was wondering if someone could critique my approach..

so in todays doom and gloom, interest rates on the way down, my pure personal opinion, I can see property prices dropping a little further and then rebounding back up eventually.

In VIC, I have seen the blue chip areas drop in some areas like 20-40% , especially the $1m prices, the say $500k ones, have dropped not as much,
Ive also noticed in the not so blue chip areas, prices have dropped slightly, I also see a lot of negative sentiment in just about every person or industry whether it be investment, shares, jobs, cars , credit cards etc.

I also believe in the "buy in gloom, sell in boom" type approach, was it Warren Buffet's quote?, I also believe that say in 3-10 years time, if you THEORETICALLY had got involved in shares, property right now, you would be saying "im really glad I did that"

so personal opinions aside, I was wondering if people could critique my approach and a few suggestions hopefully.

ok, so ive got myself about $250k cash, maybe about $250k in shares (it might be worth a fair bit less, but I haven't looked recently, but I have no intentions of selling these.

got no PPOR, got no loans/comitments of any sort, rent I pay is very minimal due to a personal arrangement, don't have any credit card problems (ie paid off every month), got no expensive/illegal hobbies, and unfortunately got a very small income job

so ive decided/want to really buy as many properties as I can in a short period of time as this is what I want to do, within reason, maybe 2 next year, maybe 5 next year depending on what comes along and being realistic

so i have the choice of buying entry level properties in the bluechip areas which have dropped a bit recently, at about 5-5.3% yield or I can buy entry level properties in not so bluechip areas for say about 6% yield.

now my questions that I am faced with is, i believe that I have this GREAT opportunity staring at me, but obviously with a low income, then serviceability is an issue. I understand that with rates going down down, the properties can be neutrally geared in the next 12 months or so (maybe),

so my question is, with low serviceability, should I go the higher yielding areas of 6%+ or stick with the bluechips that are yielding say 5% because they have been hit the hardest, however, its safer but the CGs might not be great as the 6%+ non bluechip areas......
and also, with this $200k or so in cash, technically with 5% deposit I could access $4mill in property (extreme case I know).

What can other somersofters recommend as a strategy for me. Thanks for letting me get it off my chest!
 
Hi PM.

This is not advice, just an opinion, and I'm sure you'll get many conflicting ones.

If you decide to use your $250K to invest in property, IF IT WERE ME, I would use that money to use as deposits on enough IP's so that rental repayments are making the investments cashflow positive or neutral at least.

This may only mean 2-3 properties (maybe stretch that to 4 if you also rely on servicing some of the debt with your salary), depending on where you buy and what yield you will achieve.

My reasoning being that we are in uncertain times at the moment and I don't think anyone really knows what lies around the corner. In saying that, I still think that if you are buying for the long term, that you will have growth. The other reason I say don't go overboard is that you mention you are on a small income. With multiple properties comes the chance of multiple expenses, all at the same time.

Yes, I am conservative in my approach, but by doing something like the above, it will give you time to 'get used to property' whilst continuing to learn (and hopefully getting some growth as well).

In X amount of years, these IP's will hopefully be well and truly CF+, will hopefully have had some good growth and hopefully rents will have increased. I say hopefully, because like I said before, you never know what's around the corner.

All going to plan, you can use some of the equity ( from the 'hopeful' growth;)) and buy further IP's.

Anyway, just my view at this point in time.

Regards
Marty
 
what to do..

as your income (read; servicing ability) is low, your borrowing capacity is not as great as someone with a high income with the same amount of cash.

my suggestion would be to look at higher yielding property until you have some properties under your belt. if the cash is coming in to pay for your investments, it gives you a buffer while you are looking.

the higher yielding/higher growth props would be for further down the track, after you have consolidated.

there are definitely cash flow props around now where the rent will cover all costs and leave you with cash at the end....
 
Just finished reading through the thread and it's been about a year since the last update, so I was wondering Karina, how is it going?

How many properties are you up to?

Have you gone into semi-retirement?

Did you also invest in stocks?

What's your current investment approach and philosophy as well as goals?

I left my plaudits to the end but nonetheless, it's energising reading!
 
Hey Karina

What a wonderful read ..though I've kind of heard your story firsthand, to go through all of it again was inspiring.

I do hope you can tell us how you're enjoying your 'semi retirement'.

Kudos to you !

Amelia
 
Read and learn from the people on this forum

I think it is also very important to note that Karina knows when to stop and wait.
Over the past year, those cashed up would have been lucky enough to grab some bargains out there, and herald this particular downturn as the "start"of their empire.

I sat on the sidelines and watched.
I also have no urgent intention of buying anything in the coming months, and will sit and wait to see what the interest rates are doing. My share portfolio halved in the beginning of the year, but is steadily increasing again.I could have panicked and sold when all the doom hit, but sometimes it is just better to ride with the wave.
I am just so glad that I haven't spent my whole life dumping extra money into Super!
I think the important thing is to look at your own circumstance, grab the opportunity when it presents yourself, and don't get too greedy.

I have 14 Ip's, and a $2m PPR and retirement is 3 years away.No need to upset the rhythm when you get to that point.The advise on this forum has been invaluable.
 
It ain't an overnight happening thing everyone!

I have said it all before redwing.
Just haven't been on here for a while.
I am concentrating on art now, a whole new world!

http://www.somersoft.com/forums/showthread.php?t=43415&highlight=mackay&page=2

And since I joined this forum, i have also helped my son into 6 units, 3 houses worth $550000 each, and a half share in an other great property,( took him 3 years) my daughter and her partner have also obtained 2 houses,( took them 2 years) and all her friends have followed suit. They are all on their way.When you succeed, share it around and never get greedy!
But the main thing is to get started young, help them to get started young, and then keep feeding the information to just keep them ( and yourself) going, and listen, read and learn.
 
I have said it all before redwing.
Just haven't been on here for a while.
I am concentrating on art now, a whole new world!

http://www.somersoft.com/forums/showthread.php?t=43415&highlight=mackay&page=2

And since I joined this forum, i have also helped my son into 6 units, 3 houses worth $550000 each, and a half share in an other great property,( took him 3 years) my daughter and her partner have also obtained 2 houses,( took them 2 years) and all her friends have followed suit. They are all on their way.When you succeed, share it around and never get greedy!
But the main thing is to get started young, help them to get started young, and then keep feeding the information to just keep them ( and yourself) going, and listen, read and learn.

Congratulations Bianca!

Good work on your archivements and those of your children.

Regards,

Nathan.
 
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