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From: Mike .


Help which step to take first
From: leanne
Date: 24 Feb 2001
Time: 09:03:02

Hi I have become an avid read of this forum, many thanks for all the advice. My husband and I are putting all the steps into progress towards our 1st IP.

I found a financial advisor and we are refinancing our loans and should be home free owning everything in 3 years. Our home is worth 140,000 in the Geelong area. He says there is plenty of equity there to buy an IP. How long should we wait before looking to buy?

I have read lots of books and I'm LEARNING HEAPS. I'm a bit worried about whether to buy in Melbourne or in my own area which won't cost as much, but what about c/growth?

How do I research the melbourne market to find out which areas or better? Are we better to start off small? Also after buying the IP are there lots of on going costs how much extra should I borrow to cover this? We earn about $50,000 between the pair of us and have 4 kids and also pay maintenance so we can't afford to stuff this up. But I do see it as being possible and the only real way to actually make some dosh for us in the long run.

It's all a bit scary but I'm going to give it a go, any helpful advice would be really appreciated.

Thanks heaps, Leanne.
 
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Michelle R

Reply: 1
From: Mike .


Re: Help which step to take first
From: Michelle R
Date: 24 Feb 2001
Time: 22:34:35

Hi Leanne, I'm considered a newbie so I'm not really qualified to give advice. Thought I'd share some points I've learnt from my research that could be of help.

Yes, start small, baby steps. Be very careful not over extend yourself. Buying a house in the lower end of the market should help. Many do suggest buying in your own area. For beginners I tend to agree.

I personally borrow the lot, stamp duty and legals. Real estate agent will tell you the amount for stamp duty. I'm not at all familiar with Melbourne prices. Ask Rolf (on this forum) he has the inside info. I do know there are areas in Melbourne with very poor growth, same as anywhere. A relative owns a couple of units that just made their first rise in about 8 yrs! Personally I wouldn't wait too long.

I first read Jan Somer's book about 6 yrs ago. Sure wish I hadn't listened to all the negativity I copped and jumped in back then. I'm forever seeing the places I passed up on now being worth heaps more. It's actually a little painful to think I let my own doubts and others cloud my enthusiasm.

There have been so many signs along the way. Beach side property! If it seems cheap, buy it. Aussies love the beach. John Burley says to buy the average house in a good street. Two bathrooms, garage, fence. Stick with this forum there is a wealth of knowledge here. Good hunting.

Cheers, Michelle
 
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Leanne

Reply: 1.1
From: Mike .


re Which step to take first.
From: Leanne.
Date: 26 Feb 2001
Time: 10:22:18

Just a quick note to thank you for your input Michelle. We are weaving through the works of it and I'm confident that we shall come out the end of it much the wiser and wealthier. I am reading a lot and the forum is fantastic. I will ask Rolf for some info, thanks heaps.

Regards Leanne.
 
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Owen

Reply: 1.1.1
From: Mike .


Re: Help which step to take first
From: Owen
Date: 27 Feb 2001
Time: 11:18:12

Hi Leanne,

My personal opinion would be to keep educating yourself over the next few years while you remove all your debt before embarking on any action.

I say this because of your description of your situation. With a few years left on your mortgage, relatively low combined income, 4 kids and maintenance to pay you have quite a few responsibilities. If you really concentrate on getting rid of that home loan (and any other debt) you won't belive the freedom it will give you. You have obviously been concentrating on this already and have refinanced so that is a great start. Once the home loan is gone all that money that is free to be used for investing without compromising your lifestyle or your families security.

Add this to your solid understanding of real estate investing and written plan and strategy and you are away. Good cashflow, good education, no personal debt and the ability to sleep at night. You shouldn't have any problems getting rich that way.
 
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