LOR might be great if you're portfolio is commercial IPs, AND you have them all rented.
Yeah it is - as I said before, it's fabbo. You only need a few - or even just one good renter - to carry you thru.
the "risk" with CIP is loss of tenants and the long vacancies periods that can ensue in a downturn.
...or so I've read in books from residential advocates and authors....
I kick myself for swallowing that line as well for about 10 years, especially from Jan's books. It cost me many millions of dollars to blindly believe it, without testing the theory.
I admit in a boom economy like Perth the risks are possibly less, but in the "rest of the world" these risks are real and can wipe you out.
I'd say Perth is no different from any other market. I'd say it has far more to do with the quality of the investor's mind behind the investment than the dirt and bricks, and where they are.
If your portfolio is all resi IPs, you will need many, many years to achieve LOR IMO. If you think you have an XL spreadsheet that dis-proves this, feel free to PM me.
I agree. I'd say many many years as well. I gave it up as a bad joke, so I definitely don't have an XLS saying otherwise.
This forum is supposedly the cream of property investors in Oz, and I can only think of less than a handful of very very long term investors who actually live off their investments. The vast majority all look after their investments, instead of the other way around.
I'm all resi & LOE and very happy with that situation.
If that is the case sir, then good luck to you, and best wishes for the future. As I mentioned before, you are at the mercy of your Valuer and your Banker, both of which must say yes before you continue down that path.