Sydney Market at top - calling a severe correction in 2018-2019
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Hmmm....although I do agree with you on many things, I have to disagree on this one.
I don't think I've got one "A Grade" property in my entire portfolio.I've got a range of different properties that suit a range of different criteria, and I'm happy with the progress of them all.
But then, I am predominantly a cashflow based investor.
Admittedly this is due to circumstances initially, not being able to afford to buy, unless all my costs were covered. From there we've just kept doing the same. Buying basic properties that will always be in demand.
Logical to me, following your cash flow strategy and I bet you even achieved growth due to recent boom cycle, nothing to do with "grade" of property. In fact The underdog West Syd was the star performer, how did that happen? Supply vs demand
IMO It's a bit silly getting caught up in a, b grade, especially when 'a' grade property that was posted took nearly 14 years to double, give me 'd, e, f' if this is the benchmark for A grade.
Just proves a point the performance of the property has nothing to do with the grade which is perception, what u think is A grade may Be L for lemon grade"....
Mtr
Haha hilarious L for lemon. Well let's just say I'm sure we're all ahead with the way things are. Question now is whether to take some sourdough off the table.
Im in man, i have contacts over there, lets make it happen.
It actually doubled in value by 2009, so just over 8 years which is about average you'd say.
Is it as good as other investments others have made? No, of course not; but we can hindsight ourselves to death on that.
It climbed up to ~$250k based on comparable sales around 2013, and has dropped back since the boom ended to it's current value of approx $210k - so even after a correction it is still double what I paid for it, and provides me a 35% cashflow return on purchase price..I put no cash at all into buying it, so my ROI is infinity.
If a property starts off from day 1 with pos cashflow, and then doubles in value in the above time (it actually hit 150% increase for a while); what would you call it?
Are you guys scoffing just because it is a lower-end property, and/or in a perceived not-so-flash area?
Keep in mind; I and many others here on this site were starting off with very limited resources, and had to try and maximize my choice of purchase for possible cashflow, possible cap growth, location and depreciation etc.
I think that Kal property covered all those factors.
It is important for the newbies to hear of these sorts of IP's so they can get the confidence and knowledge to go out and find some of their own.
You folks here on this site are meant to be helping these newbies; not slag off someone else's lower-end scrubber - as you perceive it - making snide backhand and smart-@rse remarks, just because it doesn't match your image of an IP that makes money.
Personally, I don't care what you guys think of it - and I am disappointed however, that you have opted to slag it off, rather than ask about the numbers behind it for the purpose of showing others what is possible.
I know it has been a winner - what I shake my head about is the smug, superior attitude and not keeping in mind we are all here to learn and teach the newbies.
Whether we grade a property a,b,c is up to our own selection criteria in the end..Just proves a point the performance of the property has nothing to do with the grade which is perception, what u think is A grade may Be L for lemon grade"....
Mtr
I was merely asking DB what he classed as the different grades because it was new terminology to me, and I wanted to get inside his head - based on his classing, and the performance of mine - I think it falls into that grade.
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It actually doubled in value by 2009, so just over 8 years which is about average you'd say.
Is it as good as other investments others have made? No, of course not; but we can hindsight ourselves to death on that.
It climbed up to ~$250k based on comparable sales around 2013, and has dropped back since the boom ended to it's current value of approx $210k - so even after a correction it is still double what I paid for it, and provides me a 35% cashflow return on purchase price..I put no cash at all into buying it, so my ROI is infinity.
If a property starts off from day 1 with pos cashflow, and then doubles in value in the above time (it actually hit 150% increase for a while); what would you call it?
Are you guys scoffing just because it is a lower-end property, and/or in a perceived not-so-flash area?
Keep in mind; I and many others here on this site were starting off with very limited resources, and had to try and maximize my choice of purchase for possible cashflow, possible cap growth, location and depreciation etc.
I think that Kal property covered all those factors.
It is important for the newbies to hear of these sorts of IP's so they can get the confidence and knowledge to go out and find some of their own.
You folks here on this site are meant to be helping these newbies; not slag off someone else's lower-end scrubber - as you perceive it - making snide backhand and smart-@rse remarks, just because it doesn't match your image of an IP that makes money.
Personally, I don't care what you guys think of it - and I am disappointed however, that you have opted to slag it off, rather than ask about the numbers behind it for the purpose of showing others what is possible.
I know it has been a winner - what I shake my head about is the smug, superior attitude and not keeping in mind we are all here to learn and teach the newbies.
Whether we grade a property a,b,c is up to our own selection criteria in the end..
I was merely asking DB what he classed as the different grades because it was new terminology to me, and I wanted to get inside his head - based on his classing, and the performance of mine - I think it falls into that grade.
That's a great result for a Z grade property haha well done mate.
DB was talking about which properties to hold (A Grade) and which properties to offload (B Grade) before the market moved into a down cycle.
There are lots of ways to turn a profit from property in all parts of the cycle and your Kalgoorlie investment is an example of that. It also seems to be an example of what can happen in a down cycle.
Personally, I'm very interested in learning about handling down cycles and working out what to do with our Sydney properties - we have some that might be A Grade and definitely some that would be B Grade.
The grading of properties is not about slagging off on the property - but of grading it so that the correct strategy can be applied. There is definitely a different strategy for see_change's Mosman apartments with views compared to skater's place at Tregear.
I'm still looking for information to grade my properties and work out the strategy going forward for each of them - location still seems to be a big factor in this.
There are lots of ways to turn a profit from property in all parts of the cycle and your Kalgoorlie investment is an example of that. It also seems to be an example of what can happen in a down cycle.
Personally, I'm very interested in learning about handling down cycles and working out what to do with our Sydney properties - we have some that might be A Grade and definitely some that would be B Grade.
The grading of properties is not about slagging off on the property - but of grading it so that the correct strategy can be applied. There is definitely a different strategy for see_change's Mosman apartments with views compared to skater's place at Tregear.
I'm still looking for information to grade my properties and work out the strategy going forward for each of them - location still seems to be a big factor in this.
Yes, we've had phenomenal growth!
Doing that right now!
With us, it was all about which to keep and which to hold. We're selling what some might term "A" graders, but to us, they weren't. We're also shooting a couple of dogs.
Let me explain. We've got a lovely home in our portfolio. It's always attracted excellent tenants. In fact the current ones treat it as their home & do small upgrades themselves. We only find out later.
There are a few problems with this property. Firstly, we bought it as a PPOR, then never moved there. It has a lovely pool & spa. Now, being older & wiser, we would never buy a rental with a pool & spa. Upkeep is more $$ than we want to spend on it each year, and as we are retiring, that is one ongoing expense we can do without. Also, because it was to be our PPOR, we put a rather large cash deposit into it. Money that I would rather spend elsewhere and get a larger yield for the capital invested.
Another that has already gone now was a subdividable block. BUT it was sitting in our Trust, and the Trust owes us something like $400k, I think. So we were able to sell this, remove part of the debt (CGT free), and move on.
One of the dogs, we bought about five years ago now. We knew it was a dog when we bought it. In fact that is why we bought it! It was a 2 x 1 unit and we bought it for $40k under market. The vendor couldn't get rid of it. It had a very high strata, and they had it rented for about $50pw under market rent and no investors were interested in it because it didn't have a decent rental yield. It was a sellers market, at the time. So, we bought it with vacant possession, put a tenant in at market rents, and waited for the market to move. It settled last week.
I don't hear anyone laughing! Pretty sure most around here can recognise a good way to make money - especially when it's so familiar already in other contexts...
If we hired some interpreters and a bunch of us headed over to Shanghai for this purpose there should be plenty to go around!
Who needs interpreters? Isn't Deltaberry Chinese? MichealX is, and so are a good many others that I've met recently.
Yeah, the honeymoon is over. Let's give the Chinese a real taste of what it means to be Middle Class.
It actually doubled in value by 2009, so just over 8 years which is about average you'd say.
Is it as good as other investments others have made? No, of course not; but we can hindsight ourselves to death on that.
It climbed up to ~$250k based on comparable sales around 2013, and has dropped back since the boom ended to it's current value of approx $210k - so even after a correction it is still double what I paid for it, and provides me a 35% cashflow return on purchase price..I put no cash at all into buying it, so my ROI is infinity.
If a property starts off from day 1 with pos cashflow, and then doubles in value in the above time (it actually hit 150% increase for a while); what would you call it?
Are you guys scoffing just because it is a lower-end property, and/or in a perceived not-so-flash area?
Keep in mind; I and many others here on this site were starting off with very limited resources, and had to try and maximize my choice of purchase for possible cashflow, possible cap growth, location and depreciation etc.
I think that Kal property covered all those factors.
It is important for the newbies to hear of these sorts of IP's so they can get the confidence and knowledge to go out and find some of their own.
You folks here on this site are meant to be helping these newbies; not slag off someone else's lower-end scrubber - as you perceive it - making snide backhand and smart-@rse remarks, just because it doesn't match your image of an IP that makes money.
Personally, I don't care what you guys think of it - and I am disappointed however, that you have opted to slag it off, rather than ask about the numbers behind it for the purpose of showing others what is possible.
I know it has been a winner - what I shake my head about is the smug, superior attitude and not keeping in mind we are all here to learn and teach the newbies.
Whether we grade a property a,b,c is up to our own selection criteria in the end..
I was merely asking DB what he classed as the different grades because it was new terminology to me, and I wanted to get inside his head - based on his classing, and the performance of mine - I think it falls into that grade.
Bb
I buy State housing, not a snob, whatever makes money.
I opened your link purchase price $105k 2001, value today $210k, Doubled in 13 years, not the best outcome, however you mentioned the market dropped back. Unfortunately Kal is higher risk IMO, ie mining cycle, in current market hard to foresee growth.
As you mentioned not hurting to hold, I get that, however it's the opportunities lost in markets that are moving and unfortunately these properties are in the main hard to sell unless mining is booming in this area, that is risk. Nothing to do whatsoever with entry level
I think we can all live and learn, and it's just my opinion we all have one
MTR
Ah yes. Just the way I label things. In my mind this "grading" has nothing to do with whether a suburb's blue chip - ie lofty Mosman or Double Bay.
