I think the hurd are starting to buy in Perth - Peaking ?

When I bought my first residential property in mid-2009, a lot of people told me properties never double in 7 years any more and that I'd have to hold it for 20 years to see may be a 30% appreciation.

All I can say is, given some recent results, that property is probably up 60-70%, in 4.5 years.

In the mean time I've had properties that's gone up 30-50% in 1 month.

As always, there'll be people who are always so willing to provide their expert opinion on the market and how it's different this time or otherwise, but I never see them make any serious money. And many people making these comments were supposedly smart guys - kids earning 6 figures at 22 years old in their first job.
 
Hi Delta
If you are referring to gurus, I would have to disagree there are a few I can think of that stronger than ever.

Steve McKnight is still kicking around making pots of money from property and business. He jumps into markets people follow, prices rise and he bails and takes his profits. He just raised $20M from investors in Oz for a new fund he has set up. Plenty happy to chip in while he sources commercial property in US and receives nice fat fees etc. This guy has the ability to reinvent himself and I expect he is seriously rich. You don't have to like the guy, but got to give him credit for his ongoing success.

MTR
 
I wish I had a crystal ball and could see what suburbs will rise in the next 2 years.

I missed the 2004 boom because I wasn't in permanent employment at the time, I don't want to miss out again. The clock is ticking. I'm getting antsy, waiting to fill out my loan docs :eek:

I just hope I won't be getting back into the market at the peak of the market, I did this in 2009. I hope I'm not taking too much of a risk buying.

Are others concerned about this?
 
I wish I had a crystal ball and could see what suburbs will rise in the next 2 years.

I missed the 2004 boom because I wasn't in permanent employment at the time, I don't want to miss out again. The clock is ticking. I'm getting antsy, waiting to fill out my loan docs :eek:

I just hope I won't be getting back into the market at the peak of the market, I did this in 2009. I hope I'm not taking too much of a risk buying.

Are others concerned about this?

I believe you have missed a significant amount of the growth spurt in the current Perth upswing. There could of course be more but you've missed the easy, quick money imo
 
yeah I know. :( Unfortunately though at the time (a couple of years ago) I wasnt in the position to buy, and then my car died too which set me back financially by quite a few months.

hmmmm
 
Good, a savvy investor can make money at any time of the cycle! I reckon you mentioned elsewhere that you are looking at properties with potential to add value. That way you will make money!
 
Yep, lots of possibilities! :)

Hi Alex, yep there are lots of possibilities. During last 12 months we got 6 offers accepted and bought 5 IPs. All within City of Gosnells suburbs. All in my opinion are 5-10% lower than what they can achieve if they are to be sold. (Knowing the market helps)

* 1 bought before it hit the internet. The agent was trying a few investors before advertising. I had convinced them that we are investors. But in fact it was our first IP. (Networking helps)
* 1 bought within a day it hit Internet. Bought before any house open. (Moving fast helps)
* 1 bought in an auction (being prepared helps)
* 1 bought as a 2 bed house but it was originally a 3 bed one (solving a problem)
* 1 bought and one offer accepted after earlier offers failed because of finance (waiting helps as well)

All these properties needed atleast painting. All cf neutral of slightly positive at current interest rates. Hope these details helps you to find a good deal. Buying well helps if we don't have any equity. We sold our PPOR and accessed equity from 2 of the above purchases to fund the deposits and buying costs. We used our wages to renovate.

We are low income earners. For high income earners it is a different ball game I reckon. To invest on a low income, each purchase is important. Cashflow should be ok and instant equity is important to enable next purchase.

It is not so great as it sounds. Two of the purchases were not very suitable for our strategy. (Having a clear strategy is important). Currently we are trying to sell them and buy a PPOR.
 
Hi Alex, yep there are lots of possibilities. During last 12 months we got 6 offers accepted and bought 5 IPs. All within City of Gosnells suburbs. All in my opinion are 5-10% lower than what they can achieve if they are to be sold. (Knowing the market helps)

* 1 bought before it hit the internet. The agent was trying a few investors before advertising. I had convinced them that we are investors. But in fact it was our first IP. (Networking helps)
* 1 bought within a day it hit Internet. Bought before any house open. (Moving fast helps)
* 1 bought in an auction (being prepared helps)
* 1 bought as a 2 bed house but it was originally a 3 bed one (solving a problem)
* 1 bought and one offer accepted after earlier offers failed because of finance (waiting helps as well)

All these properties needed atleast painting. All cf neutral of slightly positive at current interest rates. Hope these details helps you to find a good deal. Buying well helps if we don't have any equity. We sold our PPOR and accessed equity from 2 of the above purchases to fund the deposits and buying costs. We used our wages to renovate.

We are low income earners. For high income earners it is a different ball game I reckon. To invest on a low income, each purchase is important. Cashflow should be ok and instant equity is important to enable next purchase.

It is not so great as it sounds. Two of the purchases were not very suitable for our strategy. (Having a clear strategy is important). Currently we are trying to sell them and buy a PPOR.

Well done.
Am curious, did you buy any development sites.

I have an agent who emails development sites in Gosnells, he works with developers sourcing these sites and he has said this is currently a market where there are profits to be made. I had a quick look but my concern is the end values are pretty low and even with a new product trying to achieve higher price may be difficult due to lower income/demographics. I would think there is a demand for 3x2 units/villas but whether I can achieve at least $400K+ may be the issue??

Anyone looked at this closely?? Then I always think about the soil in this area, clay,.... that could be the killer.
 
Perth is pretty hot, probably a a similar point to Melbourne. A bit more growth but I can't see much more.

Surely the next to go has to be Brisbane.

Will Adelaide ever take off?
 
I too have been considering Gosnells, and also Kelmscott *for development blocks.*

I can buy in the above areas for low to mid $300's and will be able to afford the serviceability. IP wont be too NG. I might even be able to turn it neutral by value adding.*

One option I'm thinking about is:

Buy a block that can be subdivided or potential to be rezoned.

Possible Strategy:

Short term add value goal is to do an immediate Reno:

$330 k property cost
$20 k stamp duty cost
$30 k full reno cost

Total loans $380 k

Medium term goal apply for DA - In *3 - 5 years time.

Medium to Long term goal - Subdivide and sell off back vacant lot, either putting the money into the offset account against the ip loan thus increasing my rental yield or I might even sell both plots of land.*

So there are two good opportunities to add value and also helps to increase the rental yield and depreciation too. The manufactured equity I can pull out in a few years time once my ip is neutral casflow. Its essential I create my own CG. Just as vital to me is to ensure i have good cashflow as I need to be able to afford the casflow. Don't forget ATM I'm on $59,000 salary.

The other idea I'm kicking around is buying a property that has potential to add a room.
 
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