Ordinary Millionaires

[geoffw]

"The Tax Office has signalled that it will move to limit the number of years a property may be negatively geared"

Almost six years later, and it's still not happened.

Though with the shift in income tax brackets, negative gearing doesn't have the same benefit it once did.

 

[Piston Broke]

Ok here's a book I'm happy about if you want a motivational read:

On My Honor, I Will : How One Simple Oath Can Lead You to Success in Business
By: Randy Pennington, Marc Bockmon

This is what a "must read" book should be.

 

[Perp]

ozperp, if i ever have the honour of buying you a coffee, you'll be blinded by the (positive) light

Sounds divine, PB. Be warned, though: I had the privilege of lunch with steveadl last week, and he's a tough act to follow.

I'll try and track down "On My Honor..." and we can discuss books.

 

[Piston Broke]

Prove it.

Sure, remember the world wide recession & credit crunch that
according to the experts "could not be foreseen" as was "unprecedented"?
Well here's a few snippets:


Old 19-08-2006, 05:46 PM

Originally Posted by thefirstbruce
I think in Oz, inflation is good for property prices, well more specifically, those already holding property. But on the proviso that you lock in rates before core inflation threatens 3%pa...

My recollections are that inflation brings higher interest rates, which brings more inflation, which then brings higher interest rates which eventually leads to a recession and or market crash.
Sorry to bring such good news

Old 18-08-2006, 12:58 AM
There will probably another run up for a few years until we see a real crash.
In the meantime business will get harder, profits will decrease, un-employement will rise, properties will be vacant, and you will sure see the dowside of the XPJ.
Nothing new really



Old 25-01-2005, 06:07 PM
"I was wondering why someone would set a target of less than 40% LVR if they were primarily a property investor." Quintets

Here's my reason:
When your starting out and only got 1 or 2 IPs, then you need to be higly leveraged to grow your net worth qwickly. If your earning 40-50k per yr and have a 150K of IPs, then your risk level is pretty low as well.
So I would think that in this situation a lvr of even 90% is no big deal as expenses are <10k per yr, and ROI will be dramatically increased with even small CG's. And there's plenty room for more.
On the other side, when your have a reasonable portfolio, net worth is what gives you net income. So if you have 2 mil of property at 50% lvr you can expect 35-45k yr gross income. Assuming that the property is in metro areas, you will get good CG and be able to keep investing and keeping the lvr relatively low. Ex: in the past few yrs a CG of 20% would represent an extra $400k to invest, bringin the lvr higher, but given high growth in metro areas within a couple yrs the lvr will be down again. Or from an income point of view at 4% return it's an extra 16k yr income.
The other factor is that at the end of a big property boom it's not a good idea to be highly leveraged. If prices fall by 20-30% you will be in a strong position to buy.
well thats my 22 cents


05-12-2004, 10:04 AM
I see mine as being "Net Wealth"! (and I never have enough of it!!!)
I also see the "dead equity" argument a sales pitch for some one charging fees.
Investors need to be very carful that they are not over commited with debt.
Money supply is still easy and interest rates are still low, but just as it happened many times in the past, a credit squeeze may happen again. Times do seem to be changing.

happy xmas

ps my lvr is ~60% and my net wealth as opposed to my total I use to measure my objectives.


Back to the present:

Leading economists say the resulting crunch is "unprecedented in modern times".
Economics Correspondent, Stephen Long, reports.

There lots of $$ trading the "unprecedented events that nobody could foresee"

Meanwhile some people round here are still waiting for 2 consecutive negative quarters...