A Nice Surprise

From: Jakk Bass - The SLUM LORD


G'Day All,

This week I accompanied my property manager on the six monthly inspection of 4 flats that I own.
Everything seemed pretty much in order until we went into Flat 3.

The place was totally repainted including all woodwork and to a standard that is better than my own home, there was new carpets throughout and although I am no carpet expert, this is the sort of carpet that I walk straight past when I am in the market for carpet as the price is too exhorborant for me.

The tenant was just smiling and didn't say a thing and my property manager was rubbing her eyes at disbelief.
We left the flat without saying anything and outside I asked her if she knew who had done this.
She told me she'd find out.
That night she rang me after speaking to the tenant and it turns out that he'd won $18,000 on tattslotto a few weeks earlier and decided since he liked living at his flat he would do the place up.

Now my problem is.....How do I get the tenant out so that I can move in?

regards
lucky Jakk
 
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Reply: 1
From: Gail H


Hi

Wow, that's amazing. But I worry for that tenant, because the tenant has no protection for that investment of money. My dad once did what your tenant did when he was renting, and the landlord promptly put up the rent, despite the fact that my dad had added a heap to the capital value of the place. My dad moved out the next year and lost all that money. I told him he was a nut for doing it, but he trusted that everything would be ok.

So, you treat that tenant nice, ok? Why don't you send a letter of thanks, or offer a weeks free rent next year?

Anyway, its a nice story.

Gail
 
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W

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Reply: 1.1
From: F. F.


Hi Jakk,

Without knowing specifics - is it possible for you to use the tenant's gift to get a reval and realise additional equity for your own use towards another property?

Derek
 
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Reply: 1.1.1
From: Duncan M




Given that it was a Unit that was reno'ed it will be hard for Jakk to get a
valuation of anything more than the what the last sale was in the block, one
of the problems with Units, its extremely hard to increase their value.

Duncan.



-----Original Message-----
From: propertyforum Listmanager
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Sent: None
Subject: A Nice Surprise


From: "Derek Jones" <ddjones@omninet.net.au>

Hi Jakk,

Without knowing specifics - is it possible for you to use the tenant's gift
to get a reval and realise additional equity for your own use towards
another property?

Derek



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Reply: 1.1.2
From: Michele B


Just shows how far from mainstream thinking we forumites really are. Newbies think they know very little, but I bet anyone who logs on here would have made better use of an $18K windfall.
 
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Reply: 1.1.1.1
From: Nigel W


On 5/30/02 8:40:01 AM, Duncan M wrote:
>one of the problems with Units,
>its extremely hard to increase
>their value.
>
>Duncan.
>

Sorry Duncan. Must disagree with you there. I've managed to do it quite successfully with renovations.

I agree that you perhaps won't get quite as much cap gain uplift from a unit, but in the interim the rental yield is usually better and that means you can be positively geared. As Jan notes in her books, you must look at TOTAL return, ie both growth and income.

I'm interested in why you hold the contrary view.

Cheers
N.
 
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Reply: 1.1.1.1.1
From: Duncan M


Hi Nigel,

Glad to hear you've managed to increase values of units. I've just found
over the last 3-4 yrs that every time a valuation has been done on any of
our units, it invariably comes back in at the last sale price of a unit in
the complex or a similar nearby complex. New carpet, paint, new robes etc
tends to do didly squat to the valuation and making substantial external
improvements runs afoul of the Body Corporate.

I agree, minor rental improvments can be had with small renovations.

We've resolved not to buy any more individual units, just blocks as a
renovation on an entire complex can certainly add substantial value.


Regards,

Duncan.




-----Original Message-----
From: propertyforum Listmanager
[mailto:listmanager@bne003w.webcentral.com.au]
Sent: None
Subject: RE: A Nice Surprise


From: "Nigel W" <nigel.ward@msj.com.au>

On 5/30/02 8:40:01 AM, Duncan M wrote:
>one of the problems with Units,
>its extremely hard to increase
>their value.
>
>Duncan.
>

Sorry Duncan. Must disagree with you there. I've managed to do it quite
successfully with renovations.

I agree that you perhaps won't get quite as much cap gain uplift from a
unit, but in the interim the rental yield is usually better and that means
you can be positively geared. As Jan notes in her books, you must look at
TOTAL return, ie both growth and income.

I'm interested in why you hold the contrary view.

Cheers
N.



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Reply: 1.1.2.1
From: Gail H


I agree Michele: which is why I feel a little sad for the tenant. Perhaps someone should send tenant one of Jan's books?!

Gail
 
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Reply: 1.1.1.1.1.1
From: Owen .


I'm with Nigel on this one but I also think it has to do with the location of the unit in the block.

If everyones apartment look at the neighbours buildings then you have little chance of standing above the rest regardless of what you do to it.

However, if you buy the one apartment that has city views, then you have huge leverage with the valuer. The comparables are then other apartments in other blocks that have the same view. And you prove it to the valuer with reams of paperwork supporting this fact.

Home Price Guides are invaluable for buying and also revaluing. Prices in the block set your buying price (priced from the bottom up), prices in others with similar position set your new value (priced from the top down). Yours should then be what you want.

As the TV show says, "It's all about Location, Location", even in apartment blocks.

Owen

"Gambling promises the poor what property performs for the rich – something for nothing"
 
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A

Anonymous

Guest
Reply: 1.1.2.1.1
From: Anonymous


get the receipts off the tenant for tax purposes, and send the tenant a cheque for at least your tax savings.
 
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Reply: 2
From: Property Investor


Hi Jakk,

Two things:

1. If you want to move in - put the rent up just like they did to Gail's dad.
2. Thank the tenant by buying him a couple of tatts tickets. (he may win again).

Hehehe.

Mannie.
 
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Reply: 2.1
From: Jeremy Laws


Great story. Why not give the guy something like $5k in cash. He's bound to think you are wonderful, you will have a tennant probably for life and you have access to 5x that in new borrowings. I would definitely be thinking along those lines. Be nice back, it pays you tenfold....
 
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