I feel exactly the same way. I moved interstate/overseas several times but always moved home because I missed my immediate family so much everytime. I was willing to give up bigger and better opportunities elsewhere just to be with my family.
From $0 to $5.6 Million in 4 years
- Thread starter redwing
- Start date
I feel exactly the same way. I moved interstate/overseas several times but always moved home because I missed my immediate family so much everytime. I was willing to give up bigger and better opportunities elsewhere just to be with my family.
Jaycee, you'd best look away now mate.
Righto, enough backslapping, I want to know whats going on here.
I bought YIP today. As Dazz said, there's not much else to do here than debate and analyse.
Quyen has current property value of ....$5,620,000.
Purchase cost of...............................$4,543,000.
A few pages back Quyen said he owes, $4,000,000.
Rents equal $3,545 per week, or,............$184,000. per year.
I don't even know what resi interest rates are now. I suppose they are heaps less than business and commercial and farm? Are they 6.5%..??
4 million at 6.5% is $260,000 per year.
Surely extra costs and repairs to 11 properties must bring this figure to over 300k?
So we have rents of $184,000.
costing..................$300,000.
No doubt there is some tax savings there.
Is it costing more than 100k per year to hold? What have I missed here?
Can someone work out the tax savings, I'm not right up with that stuff.
See ya's.
ps. OK, there is 2 properties bought off the plan that aren't yet paying any rent. So that will make the figures look better when the rent starts coming in. Forgot that bit.
Righto, enough backslapping, I want to know whats going on here.
I bought YIP today. As Dazz said, there's not much else to do here than debate and analyse.
Quyen has current property value of ....$5,620,000.
Purchase cost of...............................$4,543,000.
A few pages back Quyen said he owes, $4,000,000.
Rents equal $3,545 per week, or,............$184,000. per year.
I don't even know what resi interest rates are now. I suppose they are heaps less than business and commercial and farm? Are they 6.5%..??
4 million at 6.5% is $260,000 per year.
Surely extra costs and repairs to 11 properties must bring this figure to over 300k?
So we have rents of $184,000.
costing..................$300,000.
No doubt there is some tax savings there.
Is it costing more than 100k per year to hold? What have I missed here?
Can someone work out the tax savings, I'm not right up with that stuff.
See ya's.
ps. OK, there is 2 properties bought off the plan that aren't yet paying any rent. So that will make the figures look better when the rent starts coming in. Forgot that bit.
Not sure TC 
Add-Backs would be interesting, such as depreciation, tax rebates etc, YIP does not have the full story (mag's never do)
Last purchase was at MAY 2009, it may even be an older story and the overall picture may be different
Purchases are at 80% and Quyen has talked about OTP also
When you add a Wife and two (2) kids into the mix it's a great result...love the mindset as posted above
I'm equally as impressed with a number of other investors on the forum also though.... Keith, Brenda, Karina, Dazz, Rixter, Rob, Nathan...the stories assist motivate me
Top Threads here
Add-Backs would be interesting, such as depreciation, tax rebates etc, YIP does not have the full story (mag's never do)
Last purchase was at MAY 2009, it may even be an older story and the overall picture may be different
Purchases are at 80% and Quyen has talked about OTP also
When you add a Wife and two (2) kids into the mix it's a great result...love the mindset as posted above
I'm equally as impressed with a number of other investors on the forum also though.... Keith, Brenda, Karina, Dazz, Rixter, Rob, Nathan...the stories assist motivate me
Top Threads here
More property talk.....
Howdy guys,
Just want to add to TopCropper's comment about Interest Rates. As a borrower, no one should be paying the standard variable rate. You should always get and request for a 0.7% discount as a minimum.
For us, because we have a strong relationship with our lender, we have negotiated for 1.0% discount of the standard variable rate.
Food for thought is that any kind of bank associated fees could be waived if you ask for it and with good justification.
And yes that story was written in January this year and all rents have increased pretty much.
Key to us being able to service our debt is because we have almost paid off the debt on our PPOR ($10k owing). So with two income, couple with tax and depreciation allowances (via fantastic accountant), we have plenty of room to service our debt. And once our curtain business gets in full swing and generates a decent turnover, this will also assist us with cash flow to continue what we're doing.
As someone mentioned earlier, Australia is one lucky country indeed. Opportunities are boundless, it's just a matter of whether one wants to grasp them or not.
Take it easy guys.
Quyen
Howdy guys,
Just want to add to TopCropper's comment about Interest Rates. As a borrower, no one should be paying the standard variable rate. You should always get and request for a 0.7% discount as a minimum.
For us, because we have a strong relationship with our lender, we have negotiated for 1.0% discount of the standard variable rate.
Food for thought is that any kind of bank associated fees could be waived if you ask for it and with good justification.
And yes that story was written in January this year and all rents have increased pretty much.
Key to us being able to service our debt is because we have almost paid off the debt on our PPOR ($10k owing). So with two income, couple with tax and depreciation allowances (via fantastic accountant), we have plenty of room to service our debt. And once our curtain business gets in full swing and generates a decent turnover, this will also assist us with cash flow to continue what we're doing.
As someone mentioned earlier, Australia is one lucky country indeed. Opportunities are boundless, it's just a matter of whether one wants to grasp them or not.
Take it easy guys.
Quyen
Congrats Quyen! I was one of the first to receive my copy about a week ago, t'was a good read.
I sent you an email regarding your buyers agency biz and really look forward to hearing from you soon.
So all in all at current variable pro pack discounted rates about $100k shortfall give or take, good to know you're not even capitalising interest at this point which you could quite easily do when times start to get tough as rates rise.
I for one, have never seen the 'risk' some others see in large amounts of debt. Some don't seem to understand that investors with larger portfolios have the ability to capitalise interest, using a small amount of their profit to keep holding for the long term. Investing isn't 'risky' if you have cash-flow to weather any storm.
Congrats again Quyen.
I sent you an email regarding your buyers agency biz and really look forward to hearing from you soon.
So all in all at current variable pro pack discounted rates about $100k shortfall give or take, good to know you're not even capitalising interest at this point which you could quite easily do when times start to get tough as rates rise.
I for one, have never seen the 'risk' some others see in large amounts of debt. Some don't seem to understand that investors with larger portfolios have the ability to capitalise interest, using a small amount of their profit to keep holding for the long term. Investing isn't 'risky' if you have cash-flow to weather any storm.
Congrats again Quyen.
True, but then Quyen doesn't seem to have a lot of it....
To pick up from TC,
Gross Rents...........................184K
Less :
Statutory Outgoings....maybe....30 K
Variable Outgoings......maybe.....20 K
equals
Nett Rents.............................134 K
Less
Interest.................................260 K
equals
Cashflow shortfall of.................125 K p.a. or ( $ 2,400 per week)
less
Tax Deduction at say 40%.........50 K p.a.
So Quyen has to reach into his pocket at the rate of 75 K p.a. or ( $ 1,400 p.w.)
75K isn't alot, at only 1.3% of his portfolio gross value every year......but it is alot if he doesn't have it. I'd say he'll probably make good money over the portfolio as the years tick by, as there is every chance he will receive higher growth rates than this.....like every other investor is hoping for.
With the Banks attitude nowadays, Quyen might be taking a breather for a few years until his in-cashflows catch up a bit with his out-cashflows. Either that, or start to sell off a bunch to pay his CGT and debts off quite a bit, and then start all over again.
True Dazz and thanks for taking the time out to do those numbers.
Quyen certainly has quite a large shortfall but I think he's done well for accumulating 5.63mil over a four year period and, realistically, he need not even purchase another property if he does not wish to and as all the accumulating (hard yards) have been done, he now only has to wait.
Seeming Quyen has around $1mil equity, or an LVR of around 72%
He should have the ability to tap into that equity, converting to cash.
If you're going to have a portfolio of this magnitude then you must have the ability to fund it, somehow. And like yourself I don't see how it will be possible with job/business income alone once rates trend back up to their previous levels but Quyen knows this and is most likely prepared for it.
I think the GFC was a fantastic opportunity for investors to accumulate much more property that otherwise would normally be possible because rates were so low, and service-ability was so high at the time.
Quyen certainly has quite a large shortfall but I think he's done well for accumulating 5.63mil over a four year period and, realistically, he need not even purchase another property if he does not wish to and as all the accumulating (hard yards) have been done, he now only has to wait.
Seeming Quyen has around $1mil equity, or an LVR of around 72%
He should have the ability to tap into that equity, converting to cash.
If you're going to have a portfolio of this magnitude then you must have the ability to fund it, somehow. And like yourself I don't see how it will be possible with job/business income alone once rates trend back up to their previous levels but Quyen knows this and is most likely prepared for it.
I think the GFC was a fantastic opportunity for investors to accumulate much more property that otherwise would normally be possible because rates were so low, and service-ability was so high at the time.
I haven't read the article.... I will one day.
But with a gross income of $184,000 and a $5.6M property value, that works out to a yield of 3.3%?
Does that make sense?
Hopefully they will improve their yield pretty soon.
But as said before, excellent work.......
Your positive frame of mind and outlook seems to be well primed and positioned to increase this already fantastic result.
Cheers,
F
But with a gross income of $184,000 and a $5.6M property value, that works out to a yield of 3.3%?
Does that make sense?
Hopefully they will improve their yield pretty soon.
But as said before, excellent work.......
Your positive frame of mind and outlook seems to be well primed and positioned to increase this already fantastic result.
Cheers,
F
Congratulations Quyen! I read the YIP article and your posts here. Your story is very inspiring to me because you sound like an normal ordinary person. If you can do it, then it gives me hope that maybe I can too. I also really admire your values - about your family and helping others.
I'm going to go out on a limb here. Please, before anyone tells me off, I am not at all trying to pull down Quyen's acheivement, because it certainly is an acheivement, but I am merely trying to put it in perspective.
There are countless stories of investors that have a similar headline (if we were to write about them all), of either from $0 to $xxx in x years, or from 0 to x properties in x years. Realistically, anyone on a large income and a (close to) paid off PPOR could borrow and purchase a huge amount of properties in a small timeframe. Admittedly most don't, so this immediately puts Quyen in a completely different catagory to the rest.
The headline is meant to turn heads, and turn heads it does. It sounds like the person went from being penniless to a multimillionaire in a few short years, when the truth is far from the fact.
Given the yeild on those properties, Quyen may have difficulty in accessing more funds to further his portfolio unless he gets a bit creative. I don't know if he has fixed his rates, but if not could be vulnerable to interest rate risk given the fact that there seems to be a large amount of neg gearing in the portfolio. Of course, I don't know what income he is on, his starting savings or the value of his PPOR so there could be some wriggle room, maybe even a LOC sitting idle for such emergencies.
More impressive to me is the nuts and bolts of the story of the person on a small income who has built up a portfolio properties and can then retire on this income. Brenda comes to mind. A stay at home mum (if I remember rightly) and a school teacher. One average income and built an empire that the family could retire on. To me, that is impressive!
There are countless stories of investors that have a similar headline (if we were to write about them all), of either from $0 to $xxx in x years, or from 0 to x properties in x years. Realistically, anyone on a large income and a (close to) paid off PPOR could borrow and purchase a huge amount of properties in a small timeframe. Admittedly most don't, so this immediately puts Quyen in a completely different catagory to the rest.
The headline is meant to turn heads, and turn heads it does. It sounds like the person went from being penniless to a multimillionaire in a few short years, when the truth is far from the fact.
Given the yeild on those properties, Quyen may have difficulty in accessing more funds to further his portfolio unless he gets a bit creative. I don't know if he has fixed his rates, but if not could be vulnerable to interest rate risk given the fact that there seems to be a large amount of neg gearing in the portfolio. Of course, I don't know what income he is on, his starting savings or the value of his PPOR so there could be some wriggle room, maybe even a LOC sitting idle for such emergencies.
More impressive to me is the nuts and bolts of the story of the person on a small income who has built up a portfolio properties and can then retire on this income. Brenda comes to mind. A stay at home mum (if I remember rightly) and a school teacher. One average income and built an empire that the family could retire on. To me, that is impressive!
Bend over skater, stick that toosh out - you are a naughty naughty girl!
Seriously tho, I guess everyone is different which includes 'perceptions' as well. Two people can have the same information in front of them and read into them differently.
To me its not the fact of how he went about doing it but the fact he did. Which to me set himself ahead of 99% of the pack.
Seriously tho, I guess everyone is different which includes 'perceptions' as well. Two people can have the same information in front of them and read into them differently.
To me its not the fact of how he went about doing it but the fact he did. Which to me set himself ahead of 99% of the pack.
Hi Skater
This isn't a competition. I don't see how someone who worked their butt off to achieve a high income and who may consequently be able to hold a NG'ed portfolio is any less impressive than someone who didn't bother to work on their income but has done better from their property investing. To me they are equally admirable achievements. Even better when combined of course but Quyen isn't competing with anyone and is significantly better off compared to the "do nothing" option.
Well done Quyen on your achievements - you are well on the way and I'm sure you're aware of the risks presented by a negative cashflow wrt your income. Thanks for sharing your story.
LOL! I might enjoy that!Bend over skater, stick that toosh out - you are a naughty naughty girl!
I agree, he has done what most would not, which why I mentioned it here.
Last edited:
Bit Harsh Skater,
That's not like you at all, having a bad day?
I think Rixter is on the ball a couple of smacks to the toosh might be required.Just because you are starting a bit head of someone else does not mean it is not a big achievement, these magazines have to fill so many pages every month, they beg for content so it is unlikely Quyen approached them to tell they how good he is he just told their story which is a good one. Doesn't matter if it is not as "impressive" as others as long as it is impressive.
As Hiequity said it is not a race, we all have didn't starting positions and different finishing lines, anyone who has the courage and conviction to follow through with their gaols and dreams should be applauded and comparisons not really necessary.
Cheers
BT
It certainly isn't a competition, I agree. But not everyone CAN earn a high income, no matter how hard they work at it. I think it is more impressive for someone on an average wage to get in there and do it than someone starting out with all their ducks in a row, so to speak. I was not trying to pull Quyen down for stepping up and doing what most will not do. Kudos to him for doing that.
To the world at large Quyen has done a remarkable thing, but this IS an investing forum. A place where MANY successful investors gather. A place where some have done much, much more than Quyen, as well as those who are working their way up to and beyond his level AND those who are aspiring to just get into the market. Here, what he has done is more or less, par for the course, I would think.
Hehe! Twice the fun?
Again, I have acknowledged that he has done more than most would ever dream of. I just have a huge problem with misleading headlines, where people perceive (not us investors, but the general public, as such) that someone has gone from broke to multimillionaire more or less overnight. Like tenants who percieve that you are rich just because you own a house. For all they know, it could be your only one with next to no equity, but to them you are the "rich landlord".
I am not trying to say that Quyen went out and approached the Mag either. For all I know his banker might have contacted them. I know (from experience) that each time I have to go to the bank, if they have to do a search on my account, I invariably get asked about all the mortgage accounts. When I say, "Yeah, I own a few houses" they look at me with wide eyes and ask how I did it. And this is without them realising that I have stuff elsewhere too.
BT, its my idea - you can hold the camera tho.
Gotta catch me first. I can be pretty quick with the skates on.
Similar threads
