house & land package
- Thread starter charlie
- Start date
Dear Charlie,
To be able to give you a better reply it's important to get some further information.
Is your first residential property for an IP (investment property) or is it your PPOR (principal place of residence)? This can affect the feedback.
What are the factors that are getting you to look at Cornubia?
-Does it have a large potential tenant base?
-Does it have public transport to easily get tenants to where they want to go?
-Does it have developed public services and easy access to shopping centres and employment areas?
Some factors to think about.
Having said that it did have a 56% increase in the average house price between the March and June 2002 quarters.
Cheers,
Sunstone.
To be able to give you a better reply it's important to get some further information.
Is your first residential property for an IP (investment property) or is it your PPOR (principal place of residence)? This can affect the feedback.
What are the factors that are getting you to look at Cornubia?
-Does it have a large potential tenant base?
-Does it have public transport to easily get tenants to where they want to go?
-Does it have developed public services and easy access to shopping centres and employment areas?
Some factors to think about.
Having said that it did have a 56% increase in the average house price between the March and June 2002 quarters.
Cheers,
Sunstone.
Yes, XBenX, I do rather agree with TheBacon - a bit more detail might be useful.
I for one would like to know a lot more about House & Land packages - good and bad - can anybody out there pls contribute their words of wisdom?
SG
I for one would like to know a lot more about House & Land packages - good and bad - can anybody out there pls contribute their words of wisdom?
SG
It just annoys me how ppl join and post open questions like this
I dont mind answering qn's it just annoys me how ppl dont contribute and then ask the world
What I was getting at was there are SO many variables that the qn is near on impossible to answer
Especially when it seems ppl join up ask a qn and want an answers when all this stuff can be found using
or
Google
Maybe Im just being a bit harsh and not giving newbies a chance.
I dont mind answering qn's it just annoys me how ppl dont contribute and then ask the world
What I was getting at was there are SO many variables that the qn is near on impossible to answer
Especially when it seems ppl join up ask a qn and want an answers when all this stuff can be found using
or
Maybe Im just being a bit harsh and not giving newbies a chance.
I think you're being a bit unreasonable XBenX. This is a discussion forum for the benefit of all. Searching or Googling isn't always the answer. Personal knowledge and experience is often much more vaulable.
I would like to think that we all contribute in one way or another - it's just that some people may be able to contribute more than others.
I don't consider myself either a newbie or a babe-in-arms but I would like to know more about H&L packages as I have never had anything to do with them before and I might be interested if there's a good deal around.
I don't think asking for the advice and/or experience of others, mainly concerning pitfalls, is out of order.
You sound like you have knowledge in this area. Can I therefore ask you:
1) What exactly is a H&L package? How would you define it from a legal / contractual point of view?
2) What experience and knowledge do you have on H&L packages?
3) What the pitfalls to watch out for?
4) What are the benefits?
5) What are potential profits?
6) What problems are likely to arise when seeking finance?
7) What are the variables you say make it so difficult to answer?
8) Can you categorise these variables for us?
9) Are H&L packages really as complicated as you suggest?
10) How can we simplify any red tape involved?
Your contribution would be much appreciated.
SG
I would like to think that we all contribute in one way or another - it's just that some people may be able to contribute more than others.
I don't consider myself either a newbie or a babe-in-arms but I would like to know more about H&L packages as I have never had anything to do with them before and I might be interested if there's a good deal around.
I don't think asking for the advice and/or experience of others, mainly concerning pitfalls, is out of order.
You sound like you have knowledge in this area. Can I therefore ask you:
1) What exactly is a H&L package? How would you define it from a legal / contractual point of view?
2) What experience and knowledge do you have on H&L packages?
3) What the pitfalls to watch out for?
4) What are the benefits?
5) What are potential profits?
6) What problems are likely to arise when seeking finance?
7) What are the variables you say make it so difficult to answer?
8) Can you categorise these variables for us?
9) Are H&L packages really as complicated as you suggest?
10) How can we simplify any red tape involved?
Your contribution would be much appreciated.
SG
B
brains
Guest
Hey Silverghost,
You forgot to include your postal details so Ben can send his tax invoice.........
You forgot to include your postal details so Ben can send his tax invoice.........
Hey calm down xBenX, we all had to learn to walk.
Being a newbie I feel a bit ashamed at throwing Qn at the forum and they appear open ended. But hey after I get to being an "experienced" PI I will be able to contribute gladly to the forum too. I deeply appreciate the time you astute and experienced guys/gals spend answering the "dumb Qns", so give us a big hug xbenx and things will be better.
Philby
Originally posted by XBenX
It just annoys me how ppl join and post open questions like this
I dont mind answering qn's it just annoys me how ppl dont contribute and then ask the world
Maybe Im just being a bit harsh and not giving newbies a chance.
Being a newbie I feel a bit ashamed at throwing Qn at the forum and they appear open ended. But hey after I get to being an "experienced" PI I will be able to contribute gladly to the forum too. I deeply appreciate the time you astute and experienced guys/gals spend answering the "dumb Qns", so give us a big hug xbenx and things will be better.
Philby
Hrmm that made me think that I am definately wrong !!!
I was questioning that I may of been to harsh but your post Philby seals it, I was !
Let me first say number of posts/newbie or not doesnt have anything to do with what you know about property investing !
I dont claim to be an expert in anything that relates to property, but I offer my opinion from what Ive read... most of the time.
There is no dumb qn and ppl should feel free to post anything they wish - id just ask that ppl do a bit or research first !
But this aint my forum, so carry on
I just dont want our true experts to get fustrated from all the same questions asked again and again
Is that just babble ? did any of it make sense ?
Unfortunately, people posting the same questions over and over will be the bane of nearly any forum. Unless the forum software itself gets smart enough to "suggest" that that topic has already been covered , and show similar topics.
Even then, newbies (myself included), may not know the correct terminology, or the favored terminology etc to use when doing the search, making life even harder. This doesn't necessarily apply to this question, but it does happen.
Even then, newbies (myself included), may not know the correct terminology, or the favored terminology etc to use when doing the search, making life even harder. This doesn't necessarily apply to this question, but it does happen.
Well XBenX, if you do not know about the area and don't like the "dumb qn" why do you post a reply? There are no dumb questions remember.
house & land
ok.
I have over the last few years bought 2 house & land packs and am now currently building a property.
I did the numbers on all my purchases and worked out what i was after as a property and should i buy a PAckage or a 2nd hand place or build.
Deal 2 . After doing the numbers on this as a PPOR It only worked out a couple of thousand more expensive to buy existing package than build it. Taking into account rent during construction, interest payments during construction and many hassles during building. And i got to move in straight away. Was unlandscaped at purchase so over time as we did it in the weekends we increased it's equity.
Deal 1 . Package 1 signed up on early during construction ( lock up i think) and manged to choose colours etc... This is a IP.
Depreciation on this as an Ip is good. had to wait 6months for it to be finished ( downside)
Deal 3. Could not find a property 2nd hand that fitted my criteria so decided to give building ago. Numerous hassles so far and the slab is yet to go down.
All I can say is do your homework on values of property in the area you want. If you found a motivated seller of an existing place it could work out you end up with more equity than buying package deal.
ok.
I have over the last few years bought 2 house & land packs and am now currently building a property.
I did the numbers on all my purchases and worked out what i was after as a property and should i buy a PAckage or a 2nd hand place or build.
Deal 2 . After doing the numbers on this as a PPOR It only worked out a couple of thousand more expensive to buy existing package than build it. Taking into account rent during construction, interest payments during construction and many hassles during building. And i got to move in straight away. Was unlandscaped at purchase so over time as we did it in the weekends we increased it's equity.
Deal 1 . Package 1 signed up on early during construction ( lock up i think) and manged to choose colours etc... This is a IP.
Depreciation on this as an Ip is good. had to wait 6months for it to be finished ( downside)
Deal 3. Could not find a property 2nd hand that fitted my criteria so decided to give building ago. Numerous hassles so far and the slab is yet to go down.
All I can say is do your homework on values of property in the area you want. If you found a motivated seller of an existing place it could work out you end up with more equity than buying package deal.
Originally posted by natmarie73
Well XBenX, if you do not know about the area and don't like the "dumb qn" why do you post a reply? There are no dumb questions remember.
Maybe because I changed my POV ? Sorry, I thought I made that obvious...
The reason I posted the first reply has been covered above....
Dear guys,
We can all get emotional on some things. The good thing at the end of the day is that the forum is a resource to help people in the property area.
Help is a two way street and no-one is an expert on everything. I prefer to take negatives and make a positive from it.
Back to the original question:
Charlie,
Okay PPOR. Generally the same criteria for choosing an investment property is different to an investment property. What may make financial sense for an investment will not necessarily be the dream place that you would desire to live in.
PPOR buyers will generally pay a higher price for property (if they can't see the additional revenue streams such as granny flats or subdivision potential) than an investor as they become more emotionally attached to the property and become less able to walk away. The key point in negotiations is to ALWAYS be able to walk away in order to get the price you want. If you can't walk away...... You will pay the higher price.
PPOR Questions.
Do you have to have a PPOR?
From a financial point of view you will find that purchasing an investment property and then renting a property yourself in the area that you want to live in makes better sense. Yes this does not take into account the security that some people gain from feeling that they "own" where they live and yes there are restrictions on what you can do with the property that you live in. However you get the benefits of the interest being deductible, the repairs, rates, general running costs all being able to be claimed. With the PPOR that you own this is NOT the case. Elsewhere in the forum archives you can see debates on this issue.
Why would you only be looking to live in the area for 5 years?
Although different strategies are employed by successful investors, you will find that the bread and butter of successful property investment is to hold and seldom (preferably never) sell.
Selling immediately eats up a big chunk of your capital gain with the associated costs. Do you really want to give away your money in an agents commission? If the property you invested in was carefully choosen in the first place why wouldn't it continue to be a good investment? If you want to sell and purchase another investment property do you really want to pay a second lot of stamp duty, conveyancing fees, mortgage discharge fees, building inspections fee and so on?
A property investment should be part of a long-term strategy. Five years is long in a share investing point of view. However in property well, it could be a lifetime.
Valid points. Comments:
-Woodridge uses the same argument about being halfway between the city and the coast.
-Close to freeway. Can be good. Must make sure if it is too close that there is adequate noise prevention.
-Close to shopping centre -How close is close? Remember not all tenants have a car. You will find that land walking distance to a major shopping centre will appreciate faster than if it is not walking distance.
Watch how close it is to the large rubbish tip in Cornubia. Smells can carry by wind. I know of a property that had 20% of it's value chopped off just because of it's proximity to the wind blowing from a sewage treatment plant over two kilometres away.
Find out the rental yields and analyse it from a numbers point of view. Are you happy with the combination of rental yield and expected capital growth?
Some things to think about. Let us know how you go.
Cheers,
Sunstone.
We can all get emotional on some things. The good thing at the end of the day is that the forum is a resource to help people in the property area.
Help is a two way street and no-one is an expert on everything. I prefer to take negatives and make a positive from it.
Back to the original question:
Charlie,
Okay PPOR. Generally the same criteria for choosing an investment property is different to an investment property. What may make financial sense for an investment will not necessarily be the dream place that you would desire to live in.
PPOR buyers will generally pay a higher price for property (if they can't see the additional revenue streams such as granny flats or subdivision potential) than an investor as they become more emotionally attached to the property and become less able to walk away. The key point in negotiations is to ALWAYS be able to walk away in order to get the price you want. If you can't walk away...... You will pay the higher price.
PPOR Questions.
Do you have to have a PPOR?
From a financial point of view you will find that purchasing an investment property and then renting a property yourself in the area that you want to live in makes better sense. Yes this does not take into account the security that some people gain from feeling that they "own" where they live and yes there are restrictions on what you can do with the property that you live in. However you get the benefits of the interest being deductible, the repairs, rates, general running costs all being able to be claimed. With the PPOR that you own this is NOT the case. Elsewhere in the forum archives you can see debates on this issue.
Why would you only be looking to live in the area for 5 years?
Although different strategies are employed by successful investors, you will find that the bread and butter of successful property investment is to hold and seldom (preferably never) sell.
Selling immediately eats up a big chunk of your capital gain with the associated costs. Do you really want to give away your money in an agents commission? If the property you invested in was carefully choosen in the first place why wouldn't it continue to be a good investment? If you want to sell and purchase another investment property do you really want to pay a second lot of stamp duty, conveyancing fees, mortgage discharge fees, building inspections fee and so on?
A property investment should be part of a long-term strategy. Five years is long in a share investing point of view. However in property well, it could be a lifetime.
Valid points. Comments:
-Woodridge uses the same argument about being halfway between the city and the coast.
-Close to freeway. Can be good. Must make sure if it is too close that there is adequate noise prevention.
-Close to shopping centre -How close is close? Remember not all tenants have a car. You will find that land walking distance to a major shopping centre will appreciate faster than if it is not walking distance.
Watch how close it is to the large rubbish tip in Cornubia. Smells can carry by wind. I know of a property that had 20% of it's value chopped off just because of it's proximity to the wind blowing from a sewage treatment plant over two kilometres away.
Find out the rental yields and analyse it from a numbers point of view. Are you happy with the combination of rental yield and expected capital growth?
Some things to think about. Let us know how you go.
Cheers,
Sunstone.
Dear Charlie,
No problems. Yes there is a lot to learn but also don't get over-awed by it all.
At the same time set yourself a goal, do your research and then take action. Many people look and never do anything. This unfortunately is called "Paralysis by Analysis".
This forum is the best property investing resource in Australia but it grows even further by your questions and input. Again let us know how you go.
Cheers,
Sunstone.
No problems. Yes there is a lot to learn but also don't get over-awed by it all.
At the same time set yourself a goal, do your research and then take action. Many people look and never do anything. This unfortunately is called "Paralysis by Analysis".
This forum is the best property investing resource in Australia but it grows even further by your questions and input. Again let us know how you go.
Cheers,
Sunstone.
