My situation and where to start?

Hi.
First post, and hoping stay around here to learn as much as I can before I dip into IP's.

I'm looking for advice on where to start working towards my goals.
I am 29 years old and have managed to put 85k into my savings after a couple of years in the mining industry. My goal was to save up a nice deposit and invest it into property/ies.
I don't have any debts, not married, no kids, and not many expenses in general (atm).
But I did lose my mining job recently, and I am looking to get into the emergency response field, either at another mine-site or government, but currently unemployed. (I have some money to live off however).
So obviously I will have to wait to get a job before I can jump in, but I want to spend my time now building my knowledge.

I pretty much know zilch about buying property and investing. Ive recently started my homework, reading books, articles, watching webinars and reading here. I'm very green to all of this (I had to start by just googling the definitions of basic terms like 'equity' for example).
I don't even really know enough yet to know what my specific goals are, I just want to use my 85k wisely and build passive income, and property interests me.

So if you could please direct me to the best sources to get started? books? columns? videos? training software? Youtube?

or any advice on what you would do in my position would be much appreciated.
thanks.
 
Hi mate,

First of all welcome, there lots of great people here.
Im in the same age as you and I just started to learned about property investment early last year. I've been into few seminars, reading books and learning more about economic and property.
I would suggest you go and download a book from yourempire.com.au, as it gave me lots of motivation and reduces my fear and give better understanding of debt.
I would also recommend you to look at Robert kiyosaki video .

Also check this video:
https://www.youtube.com/watch?v=5z5RNHuDMx8
https://www.youtube.com/watch?v=dtgsGiaAJ04
And these sky news video on Property:
https://www.youtube.com/user/goforyourlifechris/videos


in my understanding there are two type of investment : One are chasing high growth and the other is after high yield high cash flow.

From what Ive learned there's pros and cons to both strategies. there's no one strategy fits all.

for me I like investing in capital city 2 bed apartment around Sydney with roughly 4.5% yield and enjoying cash flow from my negative gearing and depreciation while the capital growth has been consistent and strong.

I tend to buy 2 apartment with parking and close to cbd, transportation, shops, cafes, schools etc.
I also avoid high rise, apartment with pool or gym, and look at suburbs with height restrictions.

Hope you can learn more from the other experts here.
 
Reading these forums is a great way to start. And ask lots of questions! No such thing as a silly question - just silly mistakes from not asking enough :)
 
The best place to learn is right here. What's more, it's FREE. The more you read, the more you will learn. Ask questions, try to answer some as well, and slowly you will find you have a lot of knowledge.

Also, get yourself another job, that way you will have the serviceability to buy the first property.

Good luck.
 
Books, websites, etc are all good but also going out there, finding properties and meeting with agents and inspecting them (even thought you are not ready to buy) is also very helpful. You will build relationships with agents and will learn what to look out for when inspecting. It will also make the process more real and when the time comes to buy your property you will be ready.

Andrew
 
Focus on employment as no cash flow will halt any investing, I would also consider getting insurance if you are the on income for your adventure.

Once you have sorted yourself out (income + insurance) then you need to decide what you are looking for in property. High yield or high capital growth (or balanced), buying regional will give you higher yields which means you can buy more properties however you will not get as much capital growth generally speaking.

As you are the same age as me (turned 29 in March), my strategy is for higher growth as we have time on our side and also I don't want to manage 30 properties when 10 good stock means less hassle for me and gives me greater returns.

The saying I work by is 'it isn't timing of the market but rather time in the market'. We all want to get the best price when we purchase and sell but even if you pay 10% more (550k on a 500k property) at 80% LVR you only needed an additional 10k for that 50k and in 20 years time the property would be worth about 2M.

Obviously if you get the property for 480k it means you have more funds for the next property and easier time servicing.

Post questions and seek feedback, there is a wealth of knowledge on the forum and it is free! In time you will be posting back helping other newbies through the same situation :)
 
Focus on employment as no cash flow will halt any investing, I would also consider getting insurance if you are the on income for your adventure.

Once you have sorted yourself out (income + insurance) then you need to decide what you are looking for in property. High yield or high capital growth (or balanced), buying regional will give you higher yields which means you can buy more properties however you will not get as much capital growth generally speaking.

As you are the same age as me (turned 29 in March), my strategy is for higher growth as we have time on our side and also I don't want to manage 30 properties when 10 good stock means less hassle for me and gives me greater returns.

The saying I work by is 'it isn't timing of the market but rather time in the market'. We all want to get the best price when we purchase and sell but even if you pay 10% more (550k on a 500k property) at 80% LVR you only needed an additional 10k for that 50k and in 20 years time the property would be worth about 2M.

Obviously if you get the property for 480k it means you have more funds for the next property and easier time servicing.

Post questions and seek feedback, there is a wealth of knowledge on the forum and it is free! In time you will be posting back helping other newbies through the same situation :)

Hahaha it looks like we're all in the age bracket :)

I Agree with you Will, invest for a capital growth first rather than chasing after yields.
It really depend what your salary are, if you're in the higher bracket, with negative gearing + depreciation you'll be most likely neutral cash flow anyway.

That's my situation anyway :) buying close to the city, gives you the scarcity factor (no more land mean price will always go up)
 
Hi mate,

Good on you for having a good savings base.

As others have said the forum is a wealth of information.

If I were in your position, I'd start with a goal in mind. Write down what you'd like to have at the end of this process. For example, ours is $4 mil in assets and $120k per year in after tax income in 10 years.

Then you can work backwards from there to see what your strategy is. Ours is buy and hold for CG and hold neutral or slightly negative portfolio.

Yours could be renos, development, subdivisions, etc.

We found that once we have it written down and projected out for the timeframe, making decisions like should we buy commercial or a reno becomes easier. Its also easier to track your progress and make any adjustments along the way if you find that what you're doing isn't working for you.
 
Brono, welcome to the good ship SS forum. Setting 'sale' to your dreams destination.

As everyone else has mentioned in this thread, Somersoft is the best place to grow your IP knowledge bank.

Pay special attention to Srini's post above. What's being said is wealth building GOLD. Anyone else just starting out on their IP journey, print it out and read it every day. Kudo's for sharing it.

P.S.. superAndrew, nice avatar. I may have seen it somewhere before. ;)
 
Hi mate,

Good on you for having a good savings base.

As others have said the forum is a wealth of information.

If I were in your position, I'd start with a goal in mind. Write down what you'd like to have at the end of this process. For example, ours is $4 mil in assets and $120k per year in after tax income in 10 years.

Then you can work backwards from there to see what your strategy is. Ours is buy and hold for CG and hold neutral or slightly negative portfolio.

Yours could be renos, development, subdivisions, etc.

We found that once we have it written down and projected out for the timeframe, making decisions like should we buy commercial or a reno becomes easier. Its also easier to track your progress and make any adjustments along the way if you find that what you're doing isn't working for you.

What's your strategy to pay down the debt?

This is also sort of our goal

Ours is about 3 mill - hold for around 7 - 10 years - subdivide to pay down about a third of debt
Hopefully the 3 mill grows to 4 to 4.5 in the 7 years add on the subdivision equity (1 mill) and we are about 2 to 2.5 in equity

Keep overall yield around 6 - 7%

4.5 mill @ 6.5% is 293k
Take off 30% for expenses 205k
Take off repayments approx 52 * 2000

Left with 101k

Not too bad but the figures can change easily - if interest rates rise
But I think if they do then growth should be better as well

I guess we could pay off debt along the way as well

Lots to think about , maybe 4 mill is the magic starting point?
 
Not too bad but the figures can change easily - if interest rates rise

Fix a portion or all (depending upon your risk profile). Its great insurance for peace of mind and insulates you from the economic climate.

IMHO, anyone building a substantial size multi-$million portfolio should fix for reasons listed above.
 
Hi.
First post, and hoping stay around here to learn as much as I can before I dip into IP's.

I'm looking for advice on where to start working towards my goals.
I am 29 years old and have managed to put 85k into my savings after a couple of years in the mining industry. My goal was to save up a nice deposit and invest it into property/ies.
I don't have any debts, not married, no kids, and not many expenses in general (atm).
But I did lose my mining job recently, and I am looking to get into the emergency response field, either at another mine-site or government, but currently unemployed. (I have some money to live off however).
So obviously I will have to wait to get a job before I can jump in, but I want to spend my time now building my knowledge.

I pretty much know zilch about buying property and investing. Ive recently started my homework, reading books, articles, watching webinars and reading here. I'm very green to all of this (I had to start by just googling the definitions of basic terms like 'equity' for example).
I don't even really know enough yet to know what my specific goals are, I just want to use my 85k wisely and build passive income, and property interests me.

So if you could please direct me to the best sources to get started? books? columns? videos? training software? Youtube?

or any advice on what you would do in my position would be much appreciated.
thanks.

Brono,on the tool bar you have the search ,just go in there and look for the books other people have listed over the years the list now would be massive find the books that work for you,and welcome too the site,just keep asking questions ,you can go back 14 years in this site and track anyone you want ,interesting reading and it's free..
 
Fix a portion or all (depending upon your risk profile). Its great insurance for peace of mind and insulates you from the economic climate.

IMHO, anyone building a substantial size multi-$million portfolio should fix for reasons listed above.

Yep

Thinking about a couple of cash flow investments which probably won't need flexibility on so will fix
I actually think the rates might go lower

We as a country might be in a bit of strife - does make me question my investment strategy though. Seems pretty reckless!
 
Is that outside of your ppor Strongy?

Don't have one

Not in a massive hurry to get one, would rather live in the country than an area of melbourne I don't like. I'm 28 now so still got a few years (hopefully!)to sort that out
I guess having kids sort of forces your hand a bit on these things as well
 
Yep

Thinking about a couple of cash flow investments which probably won't need flexibility on so will fix
I actually think the rates might go lower

We as a country might be in a bit of strife - does make me question my investment strategy though. Seems pretty reckless!

You know you can still release equity out when you fix dont you?
 
Yes, we fix the IPs opportunistically based on gut instinct - not a scientific way to go about it, but works for us. Currently all IPs are fixed till August (fixed for 2 years) at 4.5%. When they come off fixed, we'll reassess. PPoR is variable but I/O and we pay extra into the offset account.

Regarding paying down, we are following a hybrid of LoE (as per Rick's strategy) and LoR.

See his excellent post and discussions on LoE below.

http://somersoft.com/forums/showthread.php?t=37266
http://somersoft.com/forums/showthread.php?t=67551
 
Thanks for the replies!

Hi mate,

First of all welcome, there lots of great people here.
Im in the same age as you and I just started to learned about property investment early last year. I've been into few seminars, reading books and learning more about economic and property.
I would suggest you go and download a book from yourempire.com.au, as it gave me lots of motivation and reduces my fear and give better understanding of debt.
I would also recommend you to look at Robert kiyosaki video .

Also check this video:
https://www.youtube.com/watch?v=5z5RNHuDMx8
https://www.youtube.com/watch?v=dtgsGiaAJ04
And these sky news video on Property:
https://www.youtube.com/user/goforyourlifechris/videos


in my understanding there are two type of investment : One are chasing high growth and the other is after high yield high cash flow.

From what Ive learned there's pros and cons to both strategies. there's no one strategy fits all.

for me I like investing in capital city 2 bed apartment around Sydney with roughly 4.5% yield and enjoying cash flow from my negative gearing and depreciation while the capital growth has been consistent and strong.

I tend to buy 2 apartment with parking and close to cbd, transportation, shops, cafes, schools etc.
I also avoid high rise, apartment with pool or gym, and look at suburbs with height restrictions.

Hope you can learn more from the other experts here.

Cheers, subed to them gonna start watching.

Books, websites, etc are all good but also going out there, finding properties and meeting with agents and inspecting them (even thought you are not ready to buy) is also very helpful. You will build relationships with agents and will learn what to look out for when inspecting. It will also make the process more real and when the time comes to buy your property you will be ready.

Andrew
Yeah, I will do.

Focus on employment as no cash flow will halt any investing, I would also consider getting insurance if you are the on income for your adventure.

Once you have sorted yourself out (income + insurance) then you need to decide what you are looking for in property. High yield or high capital growth (or balanced), buying regional will give you higher yields which means you can buy more properties however you will not get as much capital growth generally speaking.

As you are the same age as me (turned 29 in March), my strategy is for higher growth as we have time on our side and also I don't want to manage 30 properties when 10 good stock means less hassle for me and gives me greater returns.

The saying I work by is 'it isn't timing of the market but rather time in the market'. We all want to get the best price when we purchase and sell but even if you pay 10% more (550k on a 500k property) at 80% LVR you only needed an additional 10k for that 50k and in 20 years time the property would be worth about 2M.

Obviously if you get the property for 480k it means you have more funds for the next property and easier time servicing.

Post questions and seek feedback, there is a wealth of knowledge on the forum and it is free! In time you will be posting back helping other newbies through the same situation :)

Yes, employment is my focus atm. But never hurts to start reading about IP's tho!
Im still debating about what my strategy should be. Because if i get back into mining, which is a relatively non secure job long term, should I focus on positive gearing more than higher long term growths? not sure if that sounds real nooby or not lol

Hi mate,

Good on you for having a good savings base.

As others have said the forum is a wealth of information.

If I were in your position, I'd start with a goal in mind. Write down what you'd like to have at the end of this process. For example, ours is $4 mil in assets and $120k per year in after tax income in 10 years.

Then you can work backwards from there to see what your strategy is. Ours is buy and hold for CG and hold neutral or slightly negative portfolio.

Yours could be renos, development, subdivisions, etc.

We found that once we have it written down and projected out for the timeframe, making decisions like should we buy commercial or a reno becomes easier. Its also easier to track your progress and make any adjustments along the way if you find that what you're doing isn't working for you.

I am familiar with starting with goals and working my way backwards from the end goal. But i guess my problem is atm I don't know enough to set a clear goal.



Brono,on the tool bar you have the search ,just go in there and look for the books other people have listed over the years the list now would be massive find the books that work for you,and welcome too the site,just keep asking questions ,you can go back 14 years in this site and track anyone you want ,interesting reading and it's free..

Sweet thanks. I'll have some work cut out for me
 
Hi.
First post, and hoping stay around here to learn as much as I can before I dip into IP's.

I'm looking for advice on where to start working towards my goals.
I am 29 years old and have managed to put 85k into my savings after a couple of years in the mining industry. My goal was to save up a nice deposit and invest it into property/ies.
I don't have any debts, not married, no kids, and not many expenses in general (atm).
But I did lose my mining job recently, and I am looking to get into the emergency response field, either at another mine-site or government, but currently unemployed. (I have some money to live off however).
So obviously I will have to wait to get a job before I can jump in, but I want to spend my time now building my knowledge.

I pretty much know zilch about buying property and investing. Ive recently started my homework, reading books, articles, watching webinars and reading here. I'm very green to all of this (I had to start by just googling the definitions of basic terms like 'equity' for example).
I don't even really know enough yet to know what my specific goals are, I just want to use my 85k wisely and build passive income, and property interests me.

So if you could please direct me to the best sources to get started? books? columns? videos? training software? Youtube?

or any advice on what you would do in my position would be much appreciated.
thanks.

Best source = meet as many people who have invested as possible. Ideally in different types of properties, locations, price range etc so you gain perspective on what's happening in the market.
 
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