More Somersoft Stories

[The Y-man]

Following on from

http://somersoft.com/forums/showthread.php?t=76274&

Our roving reporter Redwing has found some more gems in Somersoft....


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HandyAndy


A great 2009 story from Handy Andy that deserves to be added in to this thread.

I’m also sure there’s others within the SS vaults I’ve missed (apologies to all), if you know of any please PM YMan

I’d also love to see some updates and insights from a number of these valued contributors if they have the time and/or inclination



Quote:

Horses for courses.

I have been around this forum for a while and I don't think there are two people who have achieved substantial success in exactly the same way.

We happen to have 50+ resi doors that we lease out (currently leased, apart from those we are renovating) we also have a commercial warehouse, worth about $1mil which we can't lease out. So which one am I glad that I own?

As SF states there is a level of hands on with the resi but the cash flow is such that if we wanted it could be a lot less hands on. Presently, we have only 3 property managers with one managing the bulk of the properties. Suprisingly he does exactly what I want him to do.

We have invested in property since 1985 aquiring 4 properties by about 1993. At this point we started a business which turned into a very successful venture. It was the excess cashflow from this business that allowed us to aquire the rest of the properties over the next 10 year. We have done many renovations but have never develop from scratch.

At some point during this time I made a decision to stay resi mainly as a consequence of seeing many empty com/ind property and for lease (1995). As my intent was to develop an alternate cashflow I felt a consistent cashflow would be more assured with resi than having com/ind which can go empty for extended periods of time.

As I say horses for courses - these were the decisions I made to arrive at this point in live.

I have read many success stories with many achieving success through property development but in the end I believe they succeed because the path they choose becomes a business and its through sprinboarding the business that they acquire and are able to hold property.

Cheers

Source
http://somersoft.com/forums/showthread.php?t=54358



Bigtone

In the same 2009 thread there’s also a contribution from Bigtone


Quote:

i have 30+, about 35 approx i buy and hold only and all res, lowest amount of effort involved is what i want, no developing or renos for me, cant use a hammer personally. I have not bought any for 12 months but bought 10+ in 2008 when many were saying the world was ending, bought mostly in Melbourne at that time.

In my business i have a bookeeper and she deals with the PM's as part of her job, i know i will be ripped of thousands of $$$$ every year and just budget for it. Small change in the big picture. Forget the little stuff is a lesson I learned early. (interest rates, mortgage insurance, paying $5k too much, management fees etc, focus on those and your eyes are not on the ball IMHO.

I started investing in mid 2003 and my net wealth was $73k and income around $80k, first property was in Tassie for $72k went up 100% in 12 months, next few in Darwin gone up 300% since and just did what every body else does and kept buying as property increased in value, Last purchase was for $860k in Black Rock Melb, now trying to buy in Sydney, keep losing at auction!. Strategy was I hotspotted initially for quick growth and used that to buy bluechip.

Might buy a couple of cheapies in USA just for fun and it is a cheats way of getting the numbers up!!

My income has increased a fair bit since 03 which has helped but i have often borrowed to service debt. LVR is currently low 60%'s Coincidentally that increase in my income came from discovering my passion for IP and structuring my business to concentrate on areas related to that so I can focus on what i enjoy everyday.

It's funny when i started i wrote down my goals and the numbers going forward for each year end upto 2013, just seemed ridiculous and unachievable but each year except end of 2007 I have been miles ahead of those 'ridiculous' numbers.

I guess I have been lucky but I have also made some bad mistakes that i will avoid in future that held me back and slowed progress. So in summary I don't have 50+ yes but I want to and am very determined to get there. Also agree it is about equity and not numbers but it is fun playing real life monopoly and numbers are also good for goal setting with the end result hopefully heaps of equity!

And


Quote:

Thanks guys for your kind words, can't really talk to any of my friends about specific numbers so this is a great place to be able to talk to people who understand and are all working towards their own property goals.

Aussierogue your figures were pretty spot on until the boom in melb really kicked in the last 6 months, i bought a lot of places in 2008 that are 25-40% higher now so that has pushed equity a fair bit higher in a quick time.

A few times along the journey you go backwards during the expanding period with all the stamp duty, holding costs etc but when that next stage of the cycle goes through an area you have property in it really makes a huge difference in equity position. Initially I didnt care at all about equity I just wanted as big a portfolio as possible and then let time as "player" said work its magic.

I am a big beleiver in diversifying property in lots of areas, if I started buying in 2003 in melb where i live there would have been minimal growth for 4 years so diverifying has helped me a lot build quickly.

I am pretty new on this site but it looks like the drug of choice for me is the same for a lot of people here.... Property!

I have slowed down last 12 months but that was more to do with ability to get cash as 80% of my loans are low doc. Recent growth spurt means i can access equity and buy at 60% on a few so i am back in the game my short term aim is upgrade home to around $2m, currently $800k approx , buy a few in syd and then later brissy and perhaps a couple of $40k's now is usa for a laugh.

The enough is enough amount seems to keep getting bigger as i guess i have enough already especially since business is now worth a fair bit as well but i enjoy the work and especially enjoy the acquiring stage of property so for now happy to keep buying at a slowish pace.
Thanks for the kind words everyone.

After i put in my original post I went to bed and couldn't sleep, thought i would get canned for big-noting myself especially when it said 50+ and I don't have that many. Was kicking myself for writing it especially as a new member on the forum. So thanks to everyone who has offered encouragement and support. Helped my SANF ( couldn't work out what that meant on other threads at first didn't know what people were talking about !

Portfolio is heavily negatively geared at the moment, most early purchases are cashflow positive now by a big way but many more recent purchases especially blue chip Melbourne are basically land value, Black rock for example was bought for $860k gets $400pw. It is a corner block that two and with a stretch 3 townhouses could go on, it was valued by the bank first week of March at $1.25m so if i borrow other $50k to hold it for for the next two years it is still a pretty good result.

I don't develop but I have often bought sites that can be developed as the CG can be enormous when the developers are back in the game. I have also noticed when I have been hotspotting in towns like Mackay (2004) and Townsville (2005) you could buy development sites with no premium to normal houses. When population is booming all the builders are fully booked building new estates 5-10ks from CBD and you can buy 1-2ks out a big block with a period home and eventually those blocks have a huge premium on them, have a few good examples of this.

As i said earlier I kind of made up my theory on the run so made some mistakes but the only ones i really regret are the ones i didn't buy.

Cheers

Source
http://somersoft.com/forums/showthread.php?t=54358




Psst..If you click on the source link there’s also a great contribution from Monopoly, though not a story per se’

Michael Croft

I couldn't find a story thread for Michael only a lot of valuable renovation contributions and stories of 500 plus purchases

 

[The Y-man]

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