[Melb] Free entry to Money Expo

[Peter Parker]

A form permitting free entry to this weekend's Melbourne Money Expo is here:

http://www.infosalons.com.au/MoneyBusiness05/registerMel.asp

The free ticket is printed while you wait and is not sent by email, so there's no need to put in one's usual email address.

Rgds, Peter

 

[wombat]

Onya Spiderman - Thanks to you, I am now registered

 

[Peter Parker]

I went today. I don't think it was quite as big as last year's.

**What's big
- Free lollies (the Arab Bank had the biggest!)
- Attendees having bar codes. Stall holders scan it and, voila!, they have your name, address, email and other profile info (if you gave it)
- Share trading and magic software
- Success motivation
- Small business services

**What's not
- Property

Property stalls included purveyors of hotel units in Hobart, storage units in Seaford and Off the Plan in Toowoomba, ie not the mainstream 'average unit or house in a capital or regional city' that most of us here would favour.

** Talks

The free talks were approx 30 min, evenly divided between shares and property. The two property speakers were Monique Wakelin and Margaret Lomas.

Wakelin gave the usual spiel - buy scarcity value 2 to 7km from the CBD - this quality property will never lose value etc. However this time, as foreshadowed on earlier ABC Radio spots, properties in large centres like Geelong, Bendigo and Ballarat were thought suitable for people with limited capital and offered better growth prospects than outer Melbourne suburbs (which are likely to stagnate or fall).

That tired chestnut about the 10% growth/5% yield IP outperforming the 5% growth/10% yield IP was wheeled out yet again, while neglecting that more of the latter can be afforded so overall it works out about the same (as pointed out by Jan Somers).

A brochure dismisses +ve cashflow property as a fad sold by scammers and on a par with non-investments like timeshare accommodation. Of course, the -ve geared property scene isn't exactly lily-white either, but that is no reason to avoid this asset class either.

Lomas covered similar ground to previous presentations but emphasised the desirability of buying in the bottom third of the market. Most controversially she mentioned that cheap properties often appreciate more (percentage-wise) than median or dearer properties.

As we have learned before, buying site-unseen can take away the emotions and give you a better deal (the risk is that you miss seeing renovation opportunities in the property you buy, or not know about the privately-advertised property down the road for $20k less!).

Lomas claimed that more positive cashflow IPs can be bought than -ve geared properties. This is true, but if they are only positive after tax then sooner or later you will run out of tax deductions and will need to buy +ve before tax only.

As an example of the latter, a $100k property returning $250pw rent in Kalgoorlie was cited. This is an excellent deal (even for Kalgoorlie) so maybe there'll be a barrage of calls from Eastern States investors come Monday

Some brief words were said about complicated investment structures, such as companies and trusts. Controversially she these were of little value and that users of them may sacrifice some tax breaks available to the individual.

If I had to pay, I would probably have thought it was a little dear. Especially when compared to other uses of the money (a quality investing book from an op-shop typically costs between $1 and $4.) However for what I paid, it was excellent value for money

Rgds, Peter

 

[rich ando]

ripped off

i paid and was very disappointed.

good business model though!!!

you pay $15 for the privledge of "registering" which means they sell the database of "qualified buyers" for a premium and you will get bombarded with junk mail and spam.

once in-side it is a spruikers paradise. the stall renters pay more money and look to re-coup this by aggressively selling you their wares. there is nothing of any value that you do not have to pay more for..eg $4,000 stock market courses sold by the same conmen that were flogging gold coast property 2 years ago.

the only good stall was borders where i could have spent the $15 on a book.

call my a cynic but....

 

[Michael Yardney]

Possibly the reason that there were not many property people ther is because of the Property Expo in about 6 weeks.

With regards to buying property site unseen... isn't this a very naive view.

It suggests that all properties are alike and you are buying them purely on price - like shares.

Each property has unique aspects to it that differentiate it from others in the street. If it doesn't then maybe you shouldn't be buying it. Uniqueness or scarcity is one of the things that makes property prices go up.

 

[Peter Parker]

With regards to buying property site unseen... isn't this a very naive view.

At least it's an acknowledgement that some investors may be driven by emotions and that it's one (but not the only nor necessarily the best) way to get around that.

Margaret Lomas is essentially exchanging one risk (that of being emotionally attached to a property if it is visited) for another (the property has problems or attributes that neither the property manager nor building inspector have picked up).

Margaret's judgement is this is a fair exchange. I tend to think it probably isn't. Surely emotional attachment (particularly to something you're not going to live in) is related to one's degree of self-control. I trust myself in this regard, but others may have different attitudes.

If emotions during inspection are limited to topics like whether it reasonably fulfils tenant needs, refurbishment potential or upcoming repairs then surely an inspection can do no harm. Sometimes it may help you get something better or avoid buying a lemon.

It suggests that all properties are alike and you are buying them purely on price - like shares.

Those buying purely for yield and not other considerations like renovation potential, architectual scarcity or neighbourhood amenity might think that.

But in a market where (say) 50% of properties attract yields of over 5%, 10% over 6%, 2% over 7%, 1% over 8%, 0.5% over 9%, 0.2% over 10% and 0.1% over 11% gross, and you want that 1 in 1000 property then one can see a temptation to get in quick and put in an offer site unseen. By this way of thinking, the high yield is though a sufficient unique property to buy it, provided that about 20 critieria (which can be found out remotely) have been satisfied.

Hence there is a chance that someone who refuses to buy unseen misses out, whereas the remote internet buyer snaps up the deal. On the other hand the person on the scene might find a better deal around the corner. It might work out to the good, or it might not.

Rgds, Peter

 

[geoffw]

With regards to buying property site unseen... isn't this a very naive view.

Or even buying sight unseen.

 

[Nigel Kibel]

buying site unseen

I agree with Michael

Many investors have purchased property over the internet without seeing it. Unless you have someone to do this for you it isa dangerous stratagy. How many would buy a car without seeing it. Yet one of the most expensive items that most people will ever purchase is done online. Whats the reason it keeps you less emotional, what rubbish. If you buy without doing the research you are gambling.