Thanks for the info!
Is it time for Frankston?
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Thanks for the info!
A recent quote from Warren Buffett on real estate investment:
http://finance.fortune.cnn.com/2014/02/24/warren-buffett-berkshire-letter/
I doubt Buffett will be buying residential property in Frankston anytime soon. Sorry to burst your bubble.
Focus on the future productivity of the asset you are considering. If you don't feel comfortable making a rough estimate of the asset's future earnings, just forget it and move on. No one has the ability to evaluate every investment possibility. But omniscience isn't necessary; you only need to understand the actions you undertake.
If you instead focus on the prospective price change of a contemplated purchase, you are speculating. There is nothing improper about that. I know, however, that I am unable to speculate successfully, and I am skeptical of those who claim sustained success at doing so. Half of all coin-flippers will win their first toss; none of those winners has an expectation of profit if he continues to play the game. And the fact that a given asset has appreciated in the recent past is never a reason to buy it.
http://finance.fortune.cnn.com/2014/02/24/warren-buffett-berkshire-letter/
Can't see Buffet buying Frankston.
Wonder if he applies the criteria to other asset classes, gold springs to mind.
Of course it would apply. I would never misrepresent Gold as an asset that Warren Buffett would buy, that would be stupid, just like the Frankston example.
His father on the other hand was quite the advocate: http://www.fame.org/pdf/buffet3.pdf
Then what is the point of offering up a stupid example?
I don't know, you tell me? You offered up the example of Gold. You would need to ask grand dad why he is trying to draw the link between Buffett & Frankston.
I would think that the link would be looking at the the future productivity of the asset.
As you highlighted in the first line of Buffets quote
"Focus on the future productivity of the asset you are considering."
Which is what grand dad was doing
"The big capital gain prospects lie in Frankston/Seafords development potential."
You say the Frankston example is a stupid the same as gold.
Why do you consider developing an asset to increase its value to be stupid?
That's not what I said. If you stopped stalking me around the forums trying to pick apart every post I write then you might have stopped for long enough to read the posts thoroughly, instead of making the usual straw man attacks.
Grand dad's philosophy does not align with Buffett's is all I am pointing out, so it was a poor example to use.
grand dad: "I am in it for capital gain, not for anything else."
Buffett: "If you instead focus on the prospective price change of a contemplated purchase, you are speculating."
I wouldn't say this philosophy meets Buffett's investing criteria at all, but turk, if you feel differently then you are entitled to your own opinion. There's just no need to put words into my mouth, makes you look disingenuous
I went to Frankston on the weekend. Drove around Frankston North specifically as the price range is more appealing than Frankston proper, it looked very much like a ghetto, Couches on front porches, cars on blocks in front yards etc. does someone know the better streets in Franga North?
Why look for better street?
I shared a house in Perth in the year 2006-07. I had four share mates and two of them were weekend taxi drivers. So they normally have a stubby or dozen on Monday night. Sometimes I do join their conversation.
2006-07, Taxi drivers refused the fares to Queens Park and East Cannington. For them, those suburbs are full of runners. No street lights, Old houses, broken cars on front yard, you name it. All the bad signs were there.
Please check the today prices and do your math. I am not saying, that Frankston is carbon copy of Queens Park and East Cannington of WA, but I can see the signs, thanks to info from you guys in the forum.
Happy hunting!!
Jake Milne;1117694]
This is good to read.
Personally, I'd love to see even more first home buyers in Frankston. Once they get a hold in there, it'll be wonderful. I get the impression that there are too many investors and sometimes it's hard for them to hold their properties.
Stigma is for those who haven't travelled. Once you leave your own backyard you realise how silly it is.
Who would've thought that St Mary's or Mt Druitt NSW would be hot property? People need somewhere to live and the smart ones make the best of what they've got.
How strange that people go out of their way to post on a thread about a place they don't want to buy in. Is it a kind of bullying?
It's not very nice to read, anyway.
This is good to read.
Personally, I'd love to see even more first home buyers in Frankston. Once they get a hold in there, it'll be wonderful. I get the impression that there are too many investors and sometimes it's hard for them to hold their properties.
Stigma is for those who haven't travelled. Once you leave your own backyard you realise how silly it is.
Who would've thought that St Mary's or Mt Druitt NSW would be hot property? People need somewhere to live and the smart ones make the best of what they've got.
How strange that people go out of their way to post on a thread about a place they don't want to buy in. Is it a kind of bullying?
It's not very nice to read, anyway.
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i have excellent tennants in my frankston property and there already want to stay long term 3+ years so im really glad that has helped me alot.
if your PM isnt working for you, **** them off! cause they'll most likely give you anyone. the PM im with said to me that i only consider families or professional couples and thats what i got. true to her word and she is wonderful to deal with.
Nick
if your PM isnt working for you, **** them off! cause they'll most likely give you anyone. the PM im with said to me that i only consider families or professional couples and thats what i got. true to her word and she is wonderful to deal with.
Nick
I agree in part with this...
My neighbours at the time were great neighbours, but very negative about the area, and the same can be said for family. The neighbour told me NOT to renovate as he'd lived there 10 years & always witnessed multiple and different problematic tenants, house was filthy, smelly, with spiderwebs on spiderwebs etc.
yard rubbish etc. Extensive cosmetic reno and yard clean up, and a new & proper experienced PM led to no problems in 5 years of ownership, 21% rise in value & 18% rent rise, which led to multiple other purchases elsewhere for diversity and also the confidence to buy again.
It was a good starter for me.A lot of prospective investors would just drive in, and drive out of the suburb, thinking it was too hard. I gave it a decent go and it's all worked out well.
I think presentation and quality of stock has a lot to do with the tenants.
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I agree in part with this...
My neighbours at the time were great neighbours, but very negative about the area, and the same can be said for family. The neighbour told me NOT to renovate as he'd lived there 10 years & always witnessed multiple and different problematic tenants, house was filthy, smelly, with spiderwebs on spiderwebs etc.
Extensive cosmetic reno and yard clean up, and a new & proper experienced PM led to no problems in 5 years of ownership, 21% rise in value & 18% rent rise, which led to multiple other purchases elsewhere for diversity and also the confidence to buy again.
A lot of prospective investors would just drive in, and drive out of the suburb, thinking it was too hard. I gave it a decent go and it's all worked out well.
I think presentation and quality of stock has a lot to do with the tenants.
wow!!!! that looks amazing, well done. i can totally agree with your post impala so true.
as for the people that saw my reno blog (the reno rescue) i did pretty much the same thing as impala and im seeing an excellent return of my property. i had an evaluation last july and was told 350-370k which i was mega impressed with! so i say it can be done in frankston. impala and myself are perfect examples.
impala67: thanks for the photos! It's been reno'd really well. (Nice to see evidence of pets there too.)
neeko - I'll have a look through the threads to find your reno photos.
Makes sense that doing a nice reno like that gives you the ability to choose your tenants more wisely. When you're just starting out and don't have much money, you may make smarter decisions about what does and doesn't need to be done. Can't beat living there and doing it yourself! You get the right people wanting to stay. I lived in and did up my first place too.
This makes me think I really need to get to Frankston and spend some time and effort on the house and yard. I haven't been in a position to be choosy about my tenants yet. Also, in 2012 my rent went down, not up.
As soon as the place was settled in 2010 I had the inside painted straight away. Really, that's the sort of thing that I would enjoy doing myself but I live too far away and didn't have the time. I probably have the chance to do it again anyway because my first lot of tenants was a single mother with 5 kids. I don't think they left the place quite the way they found it - but they were pretty good, in general.
She always paid on time because her rent payments were taken straight from her benefits before they even hit her account.
Now there's a single guy and his kelpie - who needs a gate across the driveway so that she doesn't have to be tied up all day. Hoepfully the gate is going up this week. This guy's been there about 18 months now.
He started out alright but soon started falling behind in his rent. I got the property manager to put him on a 'plan' so that he pays weekly. He's not on benefits so it's voluntary - he was glad that I didn't kick him out. He's got someone in to share and the extra guy should be going on the lease now too.
I've stipulated 'no smoking' in the house so hopefully that's being respected. Smoking is the one thing I can't tolerate in a house.
Apart from painting and tidying up the yard, what did you guys do? Did you remove walls? Remove asbestos? (my beautiful big garage is full of it)
put in new appliances? Can you elaborate or post links to where you may have posted details in the past?
Thanks
neeko - I'll have a look through the threads to find your reno photos.
Makes sense that doing a nice reno like that gives you the ability to choose your tenants more wisely. When you're just starting out and don't have much money, you may make smarter decisions about what does and doesn't need to be done. Can't beat living there and doing it yourself! You get the right people wanting to stay. I lived in and did up my first place too.
This makes me think I really need to get to Frankston and spend some time and effort on the house and yard. I haven't been in a position to be choosy about my tenants yet. Also, in 2012 my rent went down, not up.
As soon as the place was settled in 2010 I had the inside painted straight away. Really, that's the sort of thing that I would enjoy doing myself but I live too far away and didn't have the time. I probably have the chance to do it again anyway because my first lot of tenants was a single mother with 5 kids. I don't think they left the place quite the way they found it - but they were pretty good, in general.
She always paid on time because her rent payments were taken straight from her benefits before they even hit her account.
Now there's a single guy and his kelpie - who needs a gate across the driveway so that she doesn't have to be tied up all day. Hoepfully the gate is going up this week. This guy's been there about 18 months now.
He started out alright but soon started falling behind in his rent. I got the property manager to put him on a 'plan' so that he pays weekly. He's not on benefits so it's voluntary - he was glad that I didn't kick him out. He's got someone in to share and the extra guy should be going on the lease now too.
I've stipulated 'no smoking' in the house so hopefully that's being respected. Smoking is the one thing I can't tolerate in a house.
Apart from painting and tidying up the yard, what did you guys do? Did you remove walls? Remove asbestos? (my beautiful big garage is full of it)
put in new appliances? Can you elaborate or post links to where you may have posted details in the past?
Thanks
We'll I can tell you what I did.
Happy to put up pics if you'd like to see
Nick.
- Ripped out old garden and relandscaped
- Painted all Facia boards, gutters,windows and down pipes
- Full roof restoration
- Pulled down carport
- New front fence, side fence and entry gate
- Extension of entertainment area
- 1x3000l watertank
- Repainted all inside
- carpeted all 3 bedrooms
- New kitchen w/ stainless steel appliances
- New Venetian blinds
- All new lighting replaced with down lights
- New door handles including cupboard and wardrobe doors
- Sanded and stained tassie oak hardwood floors
- Updated bathroom
- Tiled laundry
- New entrance door
Happy to put up pics if you'd like to see
Nick.
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