Ready for a long post?
I always appreciate it when other forumites lay out all the details of an IP purchase so at the risk of this sounding like a head trip I thought I’d give it a go.
My brief IP history…
I (and my wife) had two IP’s for the best part of 10 years from 1992 to 2002 and sold them both in early 2002 just before the boom struck down here in Tassie, mostly out of frustration of not seeing an ounce of growth in the whole time. I actually sold one for less than I paid for it. It took me a long time to get over selling them when the boom hit and there values more than doubled, and by now almost tripled. Right or wrong, I still occasionally beat myself up… like, every time I think of it!! (Insert crying icon here)
During 2003 myself, the three other residential salespeople and our spouses bought seven units off the one owner and resold them for a tidy profit. We also bought a house, did a reno and resold that too. All great learning experiences.
During this time I discovered Somersoft and like all of us here, it got me to thinking. I’ve been looing all over the place on the internet, both here and interstate but the more I read and the more I looked I started thinking it was the wrong time, even with some saying the right time to buy is when you can afford too. Everything I thought about just didn’t seem to feel right.
Anyyyyyyyyyyyyy wayyyyyyyyyyyy…. I know, I’m rambling…..
I was looking at land and thought about having three units built but had a problem with cashflow while they were going to be under construction.
During last December the was a thread where our very own Jacque posted some links to private for sale sites so I started looking there(20th December). I knew there were two houses here in Ulverstone that were for sale privately and couldn’t find them anywhere so I googled them … Ulverstone, private sale. A site that I don’t think Jacque had posted a link too came up. It only had one property in Ulverstone on it, a block of five two-bedroom units IN THE STREET I LIVE IN!!!!!
The amazing thing was/is, our property manager manages them and we’d actually inspected them about 8 months earlier to give the Sydney owners an appraisal.
Well, I got all excited and did some numbers using PIA. Next morning I told my wife about them and she was all for it (that in itself was a huge step). I rang the owner and asked a few questions. That night I rang him again and the next night I rang him and we negotiated a price. He just happened to use my solicitor here in town so we agreed that I’d give him all the details and get him to prepare a contract.
Bye Friday 23rd lunch time my wife and I had signed the contract and posted it to Sydney, 2 ½ days after seeing it on the net.
Asking price $399,000
Agreed price $360,000
Costs, about $15,000 including stamp duty
Rent, $510 pw, quite low, they should get about $120 each. My dilemma? Four of the tenants are pensioners and three have been there for about 8 years with the newest tenant having already been there three years. I’m not sure how I’m going to go putting there rents up.
Rates $5,950.
After signing up I went through the buyer’s remorse thing and thought, ‘Damn, what have I done, we’re sitting so comfortable!!’ Then I started second guessing and thinking I’d paid too much. (Michael Yardney’s book addressed those issues when I read a bit of last week. What I’ve read so far has been excellent, a lot of different thoughts and ideas.)
Then I read Presto’s thread on how he strata titled a block of 10 units and made a killing and realised, WOO HOOOOOOO…. I hope… they MAY be able to be strata titled which should increase their value considerably, NOT THAT I WANT TO SELL ANYTHING ANYMORE!!!
They settled last Friday.
Finance was a bit of a drama but that’s another story…
I always appreciate it when other forumites lay out all the details of an IP purchase so at the risk of this sounding like a head trip I thought I’d give it a go.
My brief IP history…
I (and my wife) had two IP’s for the best part of 10 years from 1992 to 2002 and sold them both in early 2002 just before the boom struck down here in Tassie, mostly out of frustration of not seeing an ounce of growth in the whole time. I actually sold one for less than I paid for it. It took me a long time to get over selling them when the boom hit and there values more than doubled, and by now almost tripled. Right or wrong, I still occasionally beat myself up… like, every time I think of it!! (Insert crying icon here)
During 2003 myself, the three other residential salespeople and our spouses bought seven units off the one owner and resold them for a tidy profit. We also bought a house, did a reno and resold that too. All great learning experiences.
During this time I discovered Somersoft and like all of us here, it got me to thinking. I’ve been looing all over the place on the internet, both here and interstate but the more I read and the more I looked I started thinking it was the wrong time, even with some saying the right time to buy is when you can afford too. Everything I thought about just didn’t seem to feel right.
Anyyyyyyyyyyyyy wayyyyyyyyyyyy…. I know, I’m rambling…..
I was looking at land and thought about having three units built but had a problem with cashflow while they were going to be under construction.
During last December the was a thread where our very own Jacque posted some links to private for sale sites so I started looking there(20th December). I knew there were two houses here in Ulverstone that were for sale privately and couldn’t find them anywhere so I googled them … Ulverstone, private sale. A site that I don’t think Jacque had posted a link too came up. It only had one property in Ulverstone on it, a block of five two-bedroom units IN THE STREET I LIVE IN!!!!!
The amazing thing was/is, our property manager manages them and we’d actually inspected them about 8 months earlier to give the Sydney owners an appraisal.
Well, I got all excited and did some numbers using PIA. Next morning I told my wife about them and she was all for it (that in itself was a huge step). I rang the owner and asked a few questions. That night I rang him again and the next night I rang him and we negotiated a price. He just happened to use my solicitor here in town so we agreed that I’d give him all the details and get him to prepare a contract.
Bye Friday 23rd lunch time my wife and I had signed the contract and posted it to Sydney, 2 ½ days after seeing it on the net.
Asking price $399,000
Agreed price $360,000
Costs, about $15,000 including stamp duty
Rent, $510 pw, quite low, they should get about $120 each. My dilemma? Four of the tenants are pensioners and three have been there for about 8 years with the newest tenant having already been there three years. I’m not sure how I’m going to go putting there rents up.
Rates $5,950.
After signing up I went through the buyer’s remorse thing and thought, ‘Damn, what have I done, we’re sitting so comfortable!!’ Then I started second guessing and thinking I’d paid too much. (Michael Yardney’s book addressed those issues when I read a bit of last week. What I’ve read so far has been excellent, a lot of different thoughts and ideas.)
Then I read Presto’s thread on how he strata titled a block of 10 units and made a killing and realised, WOO HOOOOOOO…. I hope… they MAY be able to be strata titled which should increase their value considerably, NOT THAT I WANT TO SELL ANYTHING ANYMORE!!!
They settled last Friday.
Finance was a bit of a drama but that’s another story…
