I love polls - What LVR is everyone running atm?

[sash]

It can be done.

I select properties both for CF and growth. I typically want my propeorties to be neutrally geared (without depreciation) with 1-2 years and want 7-10% growth.

If you research and buy well your LVR will not increase substantially whilst you are add as your growth is larger. I also pay down debt down agreesively via 100% offsets.

Well that is how I have done it....

Most people on this site say "yeh go borrow to 80% LVR and keep adding to the portfolio" but at the same time say "keep LVR to below 50%". How is this practically acheived? Good investing? Is that the challenge?

 

[BayView]

Not sure if I should ask this here but its to do with LVR....

How do you investors get and keep your LVR so low?

I ask this to find out how people manage to acheive LVR <80% and as low as 15%. Is this largely due to high CG over a long period? Or do most investors start with large deposits? Do saving have any part in it?

For LVR=50% and a portfolio of say $4Mil you would need to have borrowings of less than $2Mil. This means that you would have had to "make" $2Mil. I doubt most investors can make/earn this without a large portion of it due to CG.

Most people on this site say "yeh go borrow to 80% LVR and keep adding to the portfolio" but at the same time say "keep LVR to below 50%". How is this practically acheived? Good investing? Is that the challenge?

For most, it'll be from investing for a decent length of time.

This gives you time for cap growth, and debt reduction (if you do that) or both.

Part of the trick is market timing too for the cap growth, and/or find areas that are about to boom.

 

[Electro]

For most, it'll be from investing for a decent length of time.

This gives you time for cap growth, and debt reduction (if you do that) or both.

Part of the trick is market timing too for the cap growth, and/or find areas that are about to boom.

I'm gonna be a little cheeky here and say I thought it's time in the market not timing of the market?

 

[depreciator]

I'd be less than 20% I would say as of last Friday.

I know, I know, I'm a bit tardy.

Scott

 

[Electro]

It can be done.

I select properties both for CF and growth. I typically want my propeorties to be neutrally geared (without depreciation) with 1-2 years and want 7-10% growth.

This is what I have been spending hours looking for and cannot really find. I found that rent yield is inversly proportional to CG - so high CG areas will generally mean CF- for more than 1-2 yrs according to my calculations. Also due to the FHOG and Boost that properties in my range up to $450K are too high everywhere. Should I wait?

If you research and buy well your LVR will not increase substantially whilst you are add as your growth is larger. I also pay down debt down agreesively via 100% offsets.

Well that is how I have done it....

Paying down debt - I've also read some conflicting arguments about this. Should you be keeping money in offsets or buying more properties? How do you manage to save so much money at the same time as buying more IPs?

 

[sash]

Maybe...you should put $2 towards your favorite charity for every question you ask....just kiddin...LOL! And by the way....you need to change the "can't be done" attitude...wealth accumulation is an attitude and perspective. People on this site have done it ....don't see why you can't either!

Well the trick is to get into areas that are undiscovered.....

For example I got into a house in Werribee in late 2006 for 130k with a initial return of 165pw. A 8k reno later the house is now worth about 195-215k and rents for $210pw...with a potential of another $20pw more.

PM me....and I can give you some pointers on some areas I am watching. You need to be patient and know your market. But it can be done!

Before I say the below....I need to say I am the village idiot...so please be careful what you listen to.....

As for saving money...I call this the Snowball principle. The idea is to turn the property CF+ as fast as possible then apply the excess to paying your loans. Get your salary debited into the 100% offset account, pay monthly expense everything via a credit card that way oyu have rapid payment of principle. Overitme...it is like a small snowball coming down the hill by the time it get to the bottom it has grown.

This is what I have been spending hours looking for and cannot really find. I found that rent yield is inversly proportional to CG - so high CG areas will generally mean CF- for more than 1-2 yrs according to my calculations. Also due to the FHOG and Boost that properties in my range up to $450K are too high everywhere. Should I wait?



Paying down debt - I've also read some conflicting arguments about this. Should you be keeping money in offsets or buying more properties? How do you manage to save so much money at the same time as buying more IPs?

 

[Electro]

Sorry I'll shut up now and stop hijacking your thread/poll

But seriously I don't have a can't do attitude. On the contrary - I am a big picture person and have a high risk profile but at the same time I hate making bad decision so I find myself becomming obsessed with obtaining as much info as possible and benifiting from the experiance of others before I begin a new venture.

 

[sash]

Wasn't telling you to pipe it.

Becareful of over analyzying...you can then get "analysis paralysis" ...a lot of my friends have this. What happens is you look at all the data become overwhelmed and do nothing!

If you are a big picture person...focus on where you want to get to in terms of say network, properties, lifestyle, etc. The chunk it down to how you are going to get there and what strategy - i.e CF+ or CG+ properties. Weigh this against your risk tolerance and taa daa....you have a plan....well it might not be as simple but it is a start.

Would recommend you read like Jan Somers (Building Wealth through IPs), Margaret Lomas (Positive Cash Flow Property), and Rich Dad Poor Dad (Robert Kiyosaki).

Sorry I'll shut up now and stop hijacking your thread/poll

But seriously I don't have a can't do attitude. On the contrary - I am a big picture person and have a high risk profile but at the same time I hate making bad decision so I find myself becomming obsessed with obtaining as much info as possible and benifiting from the experiance of others before I begin a new venture.

 

[BayView]

I'm gonna be a little cheeky here and say I thought it's time in the market not timing of the market?

It helps to have both.

I did say that.

And, if you maximise all the possible factors other than this such as rent yield, and depreciation and other tax deductions, property selection and location, it accelerates the whole rosy picture.

 

[BayView]

How do you manage to save so much money at the same time as buying more IPs?

Make sure you spend less than you can actually afford to repay.

 

[Learnings]

I think leverage is the key to accumulating alot of properties quickly.

Once you have the growth of 3-4 properties you can steady up and let CG catch up therefore dropping the LVR down to what I consider the "best" level. sun %60 to avoid LMI on refinancings

 

[see_change]

I'm gonna be a little cheeky here and say I thought it's time in the market not timing of the market?

I'd say you'd be wrong

and if the events of the last few years havn't convinced people of the importance of timing as well as time , I don't know what will.

Yes Time is very important , but if you get your timing wrong .....

Cliff

 

[Electro]

I'd say you'd be wrong

and if the events of the last few years havn't convinced people of the importance of timing as well as time , I don't know what will.

Yes Time is very important , but if you get your timing wrong .....

Cliff

I was just requoting what most others from this forum have said.

 

[GIDDO]

I have been 68% for a while now.

Count in my offset and it is down to a more comfy 59%

 

[Quasar217]

Do you normally count your PPOR in the figure? If you count only investment properties mine is around 58%, which is a bit uncomfortably high for me if the worst predicted price falls come to fruition. I bought my most recent property only just over a year ago.

But PPOR almost fully paid off would make it around 35%. However PPOR has always been quarantined from investments and never used as security so I wouldn't normally include it.

 

[GIDDO]

Dead set Quasar?

I reckon your position sounds great. ready to buy more IPs in fact.
That's just my looser SANF showing

I reckon you shouldn't be too uncomfortable.




(not advice, just uninformed opinion)

 

[MarkandTina]

My spreadsheet is telling me 41% LVR though I've underestimated the value of our PPOR and IP.

I like keeping the risk low, I won't be as rich as some, but I'm happy the way things are.