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From: Samuel Riley


heres a true to life ROI story that may help open your mind.

My girlfriend wanted to get started in property now at the moment the govt's stamp duty exemption and first home owners grant make it very attractive.

Apartment cost= $129,000

Deposit@ 5% = $ 6,450
Legals etc = $ 600
Stamp duty = $ 0 (govt exemption)

Total cost = $ 7,050

Government gives first home owners $7,000

So the apartment cost $50

Now if it goes up 1% ($1,290) that is over a 2000% ROI. now what is 7 or 10% growth ???

Some of you might be saying "wheres the LMI on a 95% LVR, well a good broker will get the LMI built into the loan. which in this case makes it a 97%LVR

Now admittedly this case is only applicable in first home owner cases. but the govt does not give you $7,000 to buy shares and it doesn't give you tax exemptions either. Oh yeah and the bank wont lend you $129,000 to buy shares with only $6,000 in assets.

So in this case property was far and away a better investment choice then shares. The reason Leverage.

I'm not against having equity in shares but you have to be open minded to all the opportunity's that exist across all markets.

Get to it

sam
 
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Reply: 1
From: Samuel Riley


The above was meant to be a reply to eric snow... sorry it ended up here (check the time i wrote it and you will understand lol)

anyway eric whats your thought's on the above?

Sam
 
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Reply: 2
From: Sim' Hampel


This is a great example of how individuals can make healthy returns on their money by utilising the free handouts from the government. Unfortunately you can only ever do this type of transaction once, so you are not going to get rich on that alone.

You can, however, leverage other first home buyers by doing wrap style transactions.

 
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Reply: 1.1
From: Eric Snow


Sam,

Thank you for your reply, but you are making a major assumption, that the price will go up. What if the price falls by 7-10%? Whenever there is a chance of a capital gain there is also the chance of a capital loss. Also you forgot to factor in fees associated with selling.

Eric
 
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Reply: 2.1
From: Samuel Riley


It is a FACT that in the long term property prices do go up.
The unit was bought at a good price based on location, recent sales in the building and the area. So evidently the price will go up. If you are still on this forum in a year or two i will keep you updated on the price rise/fall

Yes I agree property can go down in price in certain conditions but in the above case the chances of this happening are very very slim.



The post I put in was to show new people that it is easy to get started in property and to show you that high ROI on property is acheivable. Yes it can only be done once but what a great opportunity for people to get started on the road to wealth.

regards,

Sam
 
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Reply: 1.2
From: Samuel Riley


sorry to harp on about this but at the end of the day that total investment is $50 and the original $6,500 deposit is back in your hands. Which is a good start toward the next IP or shares etc etc.

For $50 she bought a $129,000 apartment..

Sounds unrealistic but its true.

sam
 
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Reply: 1.1.1
From: Charles Homme


I must be getting old and intolerant in my old age. I have been reading the totally uniformed postings from Eric, and admire all of you who have bothered to enter into the "debate".

Eric obviously knows absolutely nothing about how to profit through property investment. As usual, when ignorant, people tend to generalise.

The facts are simple. If you know how, you can be investing in property tomorrow for as little as $100. The last deal I did involved a total cash outlay of $ 100. My return from this $100 was $ 30,000. I achieved this (cash/profit in hand) in 90 days. By my reckonings, this equates to a return on my investment (the only way you should ever look at any investment) in the thousands of %. No borrowings. No finance. No nothing. I bought well. I had it sold before I bought it. What could be easier or more risk free?

As I said, I must be becoming intolerant. I am no longer going to waste my time reading posts from ill-informed, biased, close minded investment bigots who only want to ridicule and not offer anything constructive.

I feel much better now having said that. Time for a beer.

Charles
 
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Reply: 3
From: Miss Terious


Sam...

The Governments' STAMP DUTY EXEMPTION???

Hang on a minute? When did this happen? Can someone please fill me in? Is this just relevant to NSW?

Miss Terious
 
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Reply: 3.1.1
From: Sergey Golovin


It would be true then about brand new place in NSW.

Let say they sell it for $200K – 5% (deposit=$10K)+5% (legals=$10K)=10% ($20K) to buy it.

1. Stamp duty 5% ($10K) – 100% exempt under First Home Plus. Pay none.

2. Deposit 5%=$10K - $7K(FHO Grant)+$7K(Federal Gov. Grant - New Building) all up $14K=$10K-$14K= -$4K. Government will not refund those $4K, so get none and pay none.

Serge G.
 
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No Topic - Stamp duty exemptions

Reply: 3.2
From: Steve _Deve


Hi Miss Terious

There are also stamp duty exemptions in Vic. To get them though, you need to hold a low income earner / health care card holder, and or have dependants. It also cuts out at properties above $130k

(This is from the top of my head. You can get further info on this at http://www.sro.vic.gov.au/

Cheers
Steve
(Deve)
 
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