How close are you to your goals?

[morg]

Why not have both the properties and the "higher yielding assets" you describe?

I know it comes with the territory, but getting calls from a PM telling me that "the light in the bathroom doesn't work, what do you want me to do about it ?" really doesn't appeal to me.
I find it annoying, but a necessary part of the game.
Sure I could change PMs again, and the new one will behave for awhile, but sooner or later the agency will start to churn and burn their staff and you end up receiving these kinds of calls.
It's just the nature of the industry, from my experience, so I just accept it as an annoyance until I cash my chips in.
Problem is, when it gets to this point, you really have to keep an eye on what's going on, as it is afterall your property, not theirs, and you are the only person who gives a toss about it.
This is not my idea of a hands off, passive income.
I haven't, as yet, ventured into the commercial arena, as the risks associated with a vacancy concern me. I do, however, like the idea of a long term 5 + 5 lease with the tennant paying all outgoings. Something I do intend to explore further down the track.
A nice blue chip share portfolio, sending me divvy cheques every now and then, quite appeals aswell.

 

[D.T.]

In that case perhaps increase the PM's delegation limit? If you set it to (say) $1000 they won't contact you for trivial stuff

A good portfolio requires both IMHO.

 

[morg]

It would be nice if it was that easy, Dave.
They've got $300/month which they don't spend as it is.
Frankly, I wouldn't trust any of them with $1000.
Thing with delegating responsibility is that they need to accept it aswell.
It could be easy, but then everyone would be doing it.
I'll just continue swapping PMs every now and then to keep them on there toes.
Maybe I've been unlucky, but I have quite a list of agencies I won't use across a scattering of suburbs.
I've also noticed a new business model creeping in that has 1 or 2 people calling themselves "property managers" who in turn have a bunch of assistants to do all the grunt work. One assistant will do the inspections, another will organise maintenance, another to pay bills etc.
The result is that I'm now talking to someone who has never been to my property, yet feels qualified to advise me on what the market rent is for it.
As for organising any work to be done, it all becomes like chinese whispers, with so many different helpers.
Again, I accept it as part of the gig for the time being, but I certainly won't be relying on these "professionals" to manage my retirement funds, only the vehicle.
Sorry for the rant and a bit off topic, but after a number of years of the same ol' same ol', one gets a bit tired of it.
Property has been a fantastic wealth creation vehicle for me, but when the time comes, I'll be shifting out of it and into something completely hands off that requires very minimal input from myself.
Hope this helps to explain my thinking.

 

[Intrinsic_Value]

Guys i would highlight one point here.

Yes with residential property, you do generally have a pretty poor income return, but it comes with the territory.

Low risk, low return (and ungeared residential property IS VERY LOW RISK, again this is a sweeping statement, there will be a exceptions to the rules so dont create a current affairs episode identifying the few exceptions to the rule)

Some people say go commercial, some say shares,
but each of these asset classes will also present headaches to those that dont understand the risks.

There is no free lunch in this world, at least not over longer investment periods.

 

[Aaron Sice]

Hi Aaron, can you give me some tips on "cash generation strategies"? Three and a half years into my investment accumulation phase (just bought my 3rd ip) and I am finding it hard to continue much more from a cashflow point of view and need to start investing and immediate high yield returns strategies for a while.

I agree negative gearing is not something I want to pursue any longer...any tips would be appreciated. Pm me if you wish.

Regards

Hi Daniel,

Happy to share as much as I can for the world to read. I'm not allowed under NDA to discuss too much, but i can tell you the very basics up to the point of specifics.

I've been looking to the hills for investing - vacant land is disproportionately cheaper here and I can get 3x1 transportables built at stupid low prices. They're not the most attractive designs, but they're functional with a big verandah and can be upgraded to CatD cyclone rating for only about 10% more.

This generates immediate equity for the bank to lend on and allows me to take advantage of putting the houses to market at 20% under market rent.

Why? Well, there's a few financial incentives for doing so that I can't specify (NDA), but even at these rates, we generate 9.5% to 15% yields.

Repeat across my identified 20 towns and, well, we're starting to get quite excited.

Cheers,
A.

 

[willair]

Been a good post this one,everybody has different idea's and timeframes i think you get to a level in investing that you know within yourself enough is enough,I did over ten years but it took a few hours for it all to sink in once your accountant tells you it's better to stop work now and pay less tax then go back to work and pay more ,,but i need about above 22k to keep everything going in council rates-water-insurance-maintenance,and that's only property so you have to have a good balance,share div's and property rents is all we live off,as you find once you have a small passive income,you can make more money when you stop working because you see things different,nothing like watching the sun come up each morning knowingthat the whole day is yours..willair..