My property plans

[JustaDreamer]

Goal:

5 Properties worth 2 Mill - 3 x Adelaide & 2 x Perth
Property #1 340k 350 p/w
Property #2 500k 500 p/w
Property #3 340k 350 p/w
Property #4 340k 350 p/w
Property #5 500k 500 p/w
Total rent = 8,200 p/w

2,020,000 Loan 5% Interest Only 30 years = 8,416.67 p/m

Current status:
Property #1 320k Adelaide Debt 210 Rent $310 P/W
Property #2 500k Perth Debt 225 (PPOR - I only own half of this house)

$34000 Shares (20k margin loan), $150000 Gold, $3000 Silver

Plans:
Buy another property in the next few months using equity in property 1 to buy property 3 then next year 2015 sell some gold to come up with deposit for number 4. As well as continue to build my share portfolio every month.

Anyone want to share their opinions or ideas regarding my plan.

Thanks Matt.

 

[investor2009]

Sounds good.

Only thing I can put forward is that you try to buy at a discounted price and receive higher than average rents to aid your cashflow. Cause believe me they can be draining and stressful if you're constantly working and giving them all you've got. Give it 5-10 years though and it'll all pay off.

My aim these days (I'm 33 by the way, have been investing for 10 years now) is to sell off props and get myself out of PPOR debt. Then start a-new all over again. That basically completes the first cycle for us.

 

[Singo]

Properties and shares fine.
But that much money in gold and silver? I would rather buy 3 more properties at 340k at 90% LVR. Or may be more shares.

 

[JustaDreamer]

I was aiming for 120 Oz of gold I figured when I do stop working I can sell 1 Oz a month for the next 10 years.

 

[investor2009]

One plan is better than no plan at all

 

[Emo21]

just a quick one how are you buying and storing the gold - as in are you physically buying it or on paper

 

[wylie]

just a quick one how are you buying and storing the gold - as in are you physically buying it or on paper

... and if you are storing it at home, what is your address?

 

[JustaDreamer]

wylie I came back from Thailand on the 2nd of this month to find my house broken into lucky for me its kept in a safety deposit box at the bank

emo21 most of it I got from the Perth Mint.

 

[MTR]

Hi Justadreamer

I wont comment about shares, gold or silver, as not my thing.

I would just add that there are many moving property markets at the moment such as Perth, Syd, Bris/SE QLD. In your position I would try to buy as much property as you can now and capture the growth and then move on from here. Buying another property in 2015 as you mentioned may be too late to capture the growth.

MTR

 

[nev]

Im curious as to where and how you will get a 2,020,000.00 Loan

 

[Nemo30]

There was someone in Brisbane recently who was robbed of a substantial amount of gold. Articles I read suggested that he shared too much on an investment forum and that's why thieves targeted him.

 

[Waldo]

There was someone in Brisbane recently who was robbed of a substantial amount of gold. Articles I read suggested that he shared too much on an investment forum and that's why thieves targeted him.

Sounds like I hang out on the wrong forum!

 

[D.T.]

Im curious as to where and how you will get a 2,020,000.00 Loan

Easy, by getting 5 x 400k loans one a time. Sounds like the OP has a couple down.

 

[Corey Batt]

Easy, by getting 5 x 400k loans one a time. Sounds like the OP has a couple down.

+1.

Not that difficult if you structure and time the purchases correctly.

 

[Singo]

I don't understand OP's gold strategy. But buying 5 won't be that hard. If I am OP, I would use the money invested in gold to buy a couple more properties and capture some growth. During last year even basic Perth properties have grown by 10-15% and buying at 90% LVR, one could have doubled the deposit money.

 

[Lily House]

5 Properties worth 2 Mill - 3 x Adelaide & 2 x Perth
Property #1 340k 350 p/w
Property #2 500k 500 p/w
Property #3 340k 350 p/w
Property #4 340k 350 p/w
Property #5 500k 500 p/w
Total rent = 8,200 p/w

Something has gone wrong with your rental calculation (I think, it is late and I'm not thinking straight)
Total Rent: $350 + 500 + 350 + 350 + 500 = $2050 per week (not 8,200).
Which monthly would be 2050 times 52 divided by 12 = $8883 per month.

So your rental (assuming 100% occupancy) would cover your interest payments - but only if your loans stay at or below 5% interest only - which is unlikely long term. Are you able to pay all other property expenses from another source of income?

Good luck with your plans.

 

[JustaDreamer]

Nev, I will get the loan with 2 different banks so hopefully have 1 million with ANZ and 1 million with Bankwest.


Lily House, yep your right. Total rent = 8,200 p/w should be p/m not p/w.

Also I only owe 210k on property one so that ball park figure of a 2,02,000 loan has been reduced already, as for increase in interest rates that's where shares and gold come into play just sell them off to make up the difference.

 

[alexlee]

Nev, I will get the loan with 2 different banks so hopefully have 1 million with ANZ and 1 million with Bankwest.

There's no reason to stick to ANZ and Bankwest. The goal is to own the properties, not 'have $x debt with Bank A.'

 

[Singo]

Nev, I will get the loan with 2 different banks so hopefully have 1 million with ANZ and 1 million with Bankwest

It is good to limit exposure to each bank at around 1M. ANZ, then Bankwest, and then may be CBA and finally NAB. If your plans go well, you may need more than 2M loans

Good brokers will guide you to get more loans without much trouble. You should get earlier loans with lenders with tough lending criteria and then move on to easier ones.

 

[mrdobalina]

$2m portfolio at 100% lvr. What is your risk management skills strategy if property values drop 20%?