$300k cash in bank - what would you do?

[Michalsz]

if you have a property and loan - just leave in it offset

and then wait for opportunities to come up, evaluate options. running to buy something just coz the money is there without some strategy or analysis is risky

just because you can buy a porsche doesn't mean you have to.

Yes of course, this goes without saying. Although each situation is unique and each investment move, not only delivers the next investment into the portfolio, it also progresses the broader strategy one step forward.

Actually, I would love to upgrade to the newer version of my X5, but like you say, it just doesn't make sense to do it now. The old one is just too good to trade it in. hence no business case for a new one ;-)

I believe same principle applies to acquiring investments. You only make a move that makes sense in your specific situation, your portfolio and your timing and strategy. Otherwise, why do it?

 

[Aaron Sice]

Haha how can you go to a beach to sleep with $500 pw?!?! Well you probably can - but that's about it, sleep.

because witha clear and unencumbered title, most banks will doa 50/50 loan on another comm property.

so add the $500pw you're gettig now, plus the potential of a further $500 a week against (somethign bigger but mortgaged) and that's $52k a year without blinking and a $900k portfolio.

terrible.

 

[luckyone]

I like the shares idea. No stress about tenants. Just sit back and wait for the dividends to come in.

 

[Aaron_C]

I like the shares idea. No stress about tenants. Just sit back and wait for the dividends to come in.

Yet you stress about the daily price fluctuations flashing across the screen.

 

[Sunfish]

My property settled on Friday so I have (useful amount of) cash in the bank and don't really know what to do with it. How do 90 day bank bills work?

This is no time to be long and strong in shares chasing income.

 

[Aaron_C]

You need a broker like Macquarie to invest in 90 day bank bills on your behalf.

 

[luckyone]

Yet you stress about the daily price fluctuations flashing across the screen.

Sorry Aaron, when do i do that?

 

[Sunfish]

Thanks Aaron. Just rang them: It wont work for me.

 

[Deltaberry]

because witha clear and unencumbered title, most banks will doa 50/50 loan on another comm property.

so add the $500pw you're gettig now, plus the potential of a further $500 a week against (somethign bigger but mortgaged) and that's $52k a year without blinking and a $900k portfolio.

terrible.

So he's just spent $300k to get an unencumbered title.

Where's the other $300k for the second $600k house?

Oh and between all this, where is he living? On the street?

 

[wobbycarly]

I'd buy this outright and collect the $ 500 pw and channel that elsewhere.

Then spread my towel out on the beach and go back to sleep.

http://www.realcommercial.com.au/property-offices-vic-melbourne-5816715

Haha how can you go to a beach to sleep with $500 pw?!?! Well you probably can - but that's about it, sleep.
*snip*

because witha clear and unencumbered title, most banks will doa 50/50 loan on another comm property.

so add the $500pw you're gettig now, plus the potential of a further $500 a week against (somethign bigger but mortgaged) and that's $52k a year without blinking and a $900k portfolio.

terrible.

So he's just spent $300k to get an unencumbered title.

Where's the other $300k for the second $600k house?

Oh and between all this, where is he living? On the street?

Keep up with it!! Aaron's responding to the prospect of buying a $300k commercial prop. Where does it say in this - hypothetical, remember - scenario that there is no PPOR already in the mix?

 

[Michalsz]

Keep up with it!! Aaron's responding to the prospect of buying a $300k commercial prop. Where does it say in this - hypothetical, remember - scenario that there is no PPOR already in the mix?

Thanks, you've just nailed it. Lots of assumptions flying around here. But in the interest of the discussion it's all good.

 

[evand]

ummmm...what capital gain wave?

Well maybe not. A slight variation on this could be 2-3 properties at 20% + cost. Then you ride the capital gain wave for 3-5 years. Might be a good way to go.

 

[jaycee]

ummmm...what capital gain wave?

way to shatter my dreams man.......

 

[Deltaberry]

Keep up with it!! Aaron's responding to the prospect of buying a $300k commercial prop. Where does it say in this - hypothetical, remember - scenario that there is no PPOR already in the mix?

Ok I'll let you slip through the cracks in relation to the second question.

So where's the $300k to buy the second IP (my first question)?

 

[PropertyDave]

Ok I'll let you slip through the cracks in relation to the second question.

So where's the $300k to buy the second IP (my first question)?

at the end of the rainbow

 

[jaycee]

Ok I'll let you slip through the cracks in relation to the second question.

So where's the $300k to buy the second IP (my first question)?

Didn'tAaron clearly say that the other $300k would come from a bank in the form of a loan from the bank to the purchaser (?)

 

[Deltaberry]

Aaron said:

1. Buy $300k property. This property will have unencumbered title, so that means it is fully paid off. This property generates $500 rent per week.

2. Buy a second, $600k property with $300k equity and $300k loan.

My question was, where does the second lot of $300k equity (in bold) come from? Didn't you already spend it buying the first property?

Which goes back to my original question, how does one lie on the beach all day and chill with $300k?

Regards,
Person Who Scrutinises Numbers All Day for Household Names

 

[jaycee]

Aaron said:

1. Buy $300k property. This property will have unencumbered title, so that means it is fully paid off. This property generates $500 rent per week.

2. Buy a second, $600k property with $300k equity and $300k loan.

My question was, where does the second lot of $300k equity (in bold) come from? Didn't you already spend it buying the first property?

Which goes back to my original question, how does one lie on the beach all day and chill with $300k?

Regards,
Person Who Scrutinises Numbers All Day for Household Names

1. I guess you'd have to buy above average yield tobuy a $300k proerty which rents at $500/week, which I have never done, but apparently others have done.

2. If you own one outright, then the bank will lend you $300k for another and the loans for both will be at 50% LVR plus purchasing costs. Dare say one might have to cross collatoralise to do so

Your original question about the suggestion of lying on the beach was not suggested by Aaron, it was suggested by Dazz, who I doubt was suggesting it as advice for someone who only had the $300k they came across magically in this scenario...

(I think )

 

[Dazz]

....man, there's a lot of sand blowing in my face down here at the beach....man.

All of this hot wind swirling around....it's affecting my sleep patterns.

 

[cu@thetop]

....man, there's a lot of sand blowing in my face down here at the beach....man.

All of this hot wind swirling around....it's affecting my sleep patterns.

Get your boogie board and go for a surf.