I think it should, for the purposes of this thread. I think the point is to show what deals are out there, and share ideas about how they could be financed.
The deal of a lifetime
- Thread starter keithj
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- deal of a lifetime
Still waiting for the OP's DOAL.
I don't think I have ever achieved a deal of a lifetime at the time I purchased. I simply purchased something that stacked up at the time or was apparently incorrectly priced or was slightly broken but vendor was giving a big discount.
One unit I looked at was on for about $68k it doesn't have a balcony so didn't meet my long term criteria. After informing agent I would pass (rented for $130pw) the agent phoned back and offered me the unit for $56k - well I had to say yes.
In 1999 I went along and look at a block of units after looking at a block in Liverpool. The Liverpool units were disgusting with some obvious tenant problems. Whilst in the area thought I would pop over to Cabramatta (pre arranged) and inspect a block. The tenant were great as there was an obvious community spirit with a level of care about their premises. The price for my first block was $500k for 7 x 2br units, so about $72k per, with the rents at about $130pw. After renos we were able to lift the rent to $180pw renos cost me about $8k per unit.
At that time this was the market price for units in Cabra so hardly ADOAL on the day but +cf and per unit less than DA'd blocks ready to build Units.
Went on and bought a few other blocks and also individuals.
Bought one block of 9 ($700k) just before the market was starting to move. Whilst we were renoing this block block behind was individually owned and we were trying to buy this block also. Whist waiting for the contract, at $80k per, their solicitor introduced another buyer to the vendor and it sold without my knowledge. It sold at the same price I was offering. The mob that bought it was one of those groups that buy blocks to strata, polish up and sell which they did and they marketed them at $145k each this was all in a matter of 4 months.
Renoed units with garage are now around $250k (thanks Krudd) and rent out for $290-300 pw.
Cheers
One unit I looked at was on for about $68k it doesn't have a balcony so didn't meet my long term criteria. After informing agent I would pass (rented for $130pw) the agent phoned back and offered me the unit for $56k - well I had to say yes
.In 1999 I went along and look at a block of units after looking at a block in Liverpool. The Liverpool units were disgusting with some obvious tenant problems. Whilst in the area thought I would pop over to Cabramatta (pre arranged) and inspect a block. The tenant were great as there was an obvious community spirit with a level of care about their premises. The price for my first block was $500k for 7 x 2br units, so about $72k per, with the rents at about $130pw. After renos we were able to lift the rent to $180pw renos cost me about $8k per unit.
At that time this was the market price for units in Cabra so hardly ADOAL on the day but +cf and per unit less than DA'd blocks ready to build Units.
Went on and bought a few other blocks and also individuals.
Bought one block of 9 ($700k) just before the market was starting to move. Whilst we were renoing this block block behind was individually owned and we were trying to buy this block also. Whist waiting for the contract, at $80k per, their solicitor introduced another buyer to the vendor and it sold without my knowledge. It sold at the same price I was offering
. The mob that bought it was one of those groups that buy blocks to strata, polish up and sell which they did and they marketed them at $145k each this was all in a matter of 4 months.Renoed units with garage are now around $250k (thanks Krudd) and rent out for $290-300 pw.
Cheers
Just wondering, is this termed being 'gazumped' and is it particular to NSW?
Sounds like a ripper! "You must spread around kudos before giving it to Bigtone again."
Thanks ozperp, its Friday morning i will take that as a "claytons" kudos!
I have some friends and colleagues buying in USA atm. Just had one secure a block of (7* 2 Br's) for $95K rents for $30pa , not on the scale you found but easier to fund.
I think private syndicates will become a lot more prominent in the next few years as lending continues to tighten. I think they have enormous potential, next time u find a deal u can't fund send me a PM and we can have a chat.
All good deals should be able to be funded in one way or another. Just a matter of joining the people who can find the deals with the people who can't/don't want to have the cash and want to invest.
Cheers
BT
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Better be quick. The Yanks are waking up to the power of syndicates and buying property in bulk from the banks.
ok i will throw in one of my "deals of a lifetime"
Darwin late 2003 a mate and i went up to have a look around at property, loved what we saw, low prices, high rents, massive infrastructure upgrade and increasing population. On the Saturday we picked out a few 2br units around the $120-$135k mark and went back to the hotel to discuss the lie of land and which ones to make offers on etc.
While having a few beers in the hotel pool bar and discussing the strategy I noticed the local Paper sitting on the bar, on about page 10 (not in the RE section) was an ad for a block of units 'block of 12 1 Bdr units" $780k, 200m to beach in Poinciana, that sounded good but was out of my price range as i only had 2 IP's at that stage. Read more and saw the magic words "individual strata".
Open for inspection was about to start so i dragged my mate out of the pool (which was difficult because there was some assets poolside he was more interested in pursuing!).
Anyway got out of the car and my mate says "which one of these dumps we looking at" I motioned the whole building and his attitude changed completely
We were the only ones who turned up, turns out the vendors who were older just wanted an easy sale and couldn't be bothered with selling all separately. So we offered full price on the whole block on the basis we could sign 12 individual contracts, settle same day and do 5 in my name and 7 in my mates. That meant we owned our own units and it was so much easier to finance as we could spread around different lenders. After a bit of negotiating and creative financing I secured my 5 for a total contribution of $20k
Price was $65k each and that included "furniture".
They were leased between $110 and $120pw each.
As tenants were replaced over time we leased them as unfurnished so we did not have to replace anything.
Anyway end result is they doubled in 12 months and after recent boom are now $220K-$240k and rent for between $200 -$250pw.
Good return on $20k and have been cashflow positive since the 2nd year ( there were a few costs to sort out in first year)
Cheers
BT
Nice Deal, BigTone,
Another positive of this deal was that, by my calculations
o) you would have only paid about 40% of the stamp duty that would have been payable should you have bought them all on the one contract!Boods
Nice Deal, BigTone,
Another positive of this deal was that, by my calculations
Boods
Yes nice pick up, there was a bit of back and forth on this with NT SRO on this point and ended up paying about 60% of the total one contract price. They wanted it all saying "related purchase" and after negotiating we settled on a figure of around 60%. I had forgotten about that so very sharp on your behalf!
i have three on my desk now.
could use the state and fed govt to fund them as well.
could use the state and fed govt to fund them as well.
Yes. You could call it gazumped except that this property wasn't on the market and there was no agent involved (except my buyer agent) It was through the actions of the BA that we convinced the vendor to sell and then it was only because the vendors solicitor dragged up one of his mates that I missed out.
Water under the bridge but still annoying as there were 12 units in the block.
Cheers
Further consideration regarding the deal of a lifetime was our introdcution to property investing by a guy who came to show us how easy it was and how we could do it too. The company he represented would monitor the investment and took an ongoing fee. We didn't go with them but paid for the advice (not sure but think it was fifty bucks or so).
Anyway got us thinking and now we have a reasonable portfolio. Best fifty bucks we spent.
Regards
Andrew
Anyway got us thinking and now we have a reasonable portfolio. Best fifty bucks we spent.
Regards
Andrew
hi all
interesting question
the deal we are doing at the moment would fall into this but not going to post here
sorry about that
most deals don't come because you want them they come because you are there at the right time
are deals come from places where you have no idea they would
my best was a 1 day transaction where I bought for 350k and sold for 1.5 mil and they paid the 350k to get the deal done that was a very good deal and the group made a lot of money.
I see deals that go past my desks that most here would think its the deal of their life time
will they do the deal is the question
simply no
simply question not do you want the deal of a live time the question is if you see it will you go and get it
most people post the deal of a life time they did not get
my question is why
if it was a good deal why did you not go with it
and the answer is simple
deals of a life time are good to look at 1 2 3 years down the track
but what about the deals now, today, are they there yes they are
they just need funding its that simple
the deal of today will be the deal if a life time tomorrow you will just read about it
I do look at deals of a life time
I look at deals of today
maybe I am missing some thing here
interesting question
the deal we are doing at the moment would fall into this but not going to post here
sorry about that
most deals don't come because you want them they come because you are there at the right time
are deals come from places where you have no idea they would
my best was a 1 day transaction where I bought for 350k and sold for 1.5 mil and they paid the 350k to get the deal done that was a very good deal and the group made a lot of money.
I see deals that go past my desks that most here would think its the deal of their life time
will they do the deal is the question
simply no
simply question not do you want the deal of a live time the question is if you see it will you go and get it
most people post the deal of a life time they did not get
my question is why
if it was a good deal why did you not go with it
and the answer is simple
deals of a life time are good to look at 1 2 3 years down the track
but what about the deals now, today, are they there yes they are
they just need funding its that simple
the deal of today will be the deal if a life time tomorrow you will just read about it
I do look at deals of a life time
I look at deals of today
maybe I am missing some thing here
Question for those with more RE experience than me (most of you I expect )
If you came across the DOALT and were not currently cashed up, would you consider creative finance in order to get the deal done? If so what sort.
For example if there was a potential "instant profit" would you buy without finance on a long settlement then refinance based on your "instant equity". Or would you borrow the deposit, or offer to buy on vendor finance, etc?
( Oh I see smilies dont work across the top )
)If you came across the DOALT and were not currently cashed up, would you consider creative finance in order to get the deal done? If so what sort.
For example if there was a potential "instant profit" would you buy without finance on a long settlement then refinance based on your "instant equity". Or would you borrow the deposit, or offer to buy on vendor finance, etc?
( Oh I see smilies dont work across the top
)If you came across the DOALT and were not currently cashed up, would you consider creative finance in order to get the deal done? If so what sort.
For example if there was a potential "instant profit" would you buy without finance on a long settlement then refinance based on your "instant equity". Or would you borrow the deposit, or offer to buy on vendor finance, etc?
( Oh I see smilies dont work across the top
Hey Toe.
I can get the top one I mentioned on terms over two yrs & I've negotiated others but I don't like to go that way on investment. Things can too easily go wrong & leave you at big losses in time , work & money put into but the origional owners even better & holding it all , for free .
Buying that way as your own place is ok imo as long as your safely covered, I've bought two like that .You only really need to worry about the repayments & refinancing later but as investing it tends to be short term & a whole new ball game, pressures & heavily in his favor.
I don't like that arrangement but it may have to be set that way in order for him to agree in the first place.
The same with reno projects , I've looked into a lot of the no money down stuff. Sounds great on paper but at the end of the day if it goes pear shaped you lose everything you've put in & again owner gets the lot .
The instant equity thing is also a lot harder than they make out , fine if it's all in your name already but our banks usually don't give a damn otherwise & go on origional purchasing contract prices & dates instead . It's much easier said than done .
You can get them if you want but to my thinking it's pretty risky especially over the next few yrs.
And the first thing the backer or vendor will say is, but you have nothing to lose, bs you have heaps to lose & there's no safety net for you !
Cheers
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I've been working at a software consultancy in Newcastle-upon-Tyne in the last few weeks. The owner comes from an Indian background, though he's probably second or third generation, and has an extensive family network in the city these days.
One of these is his uncle, who arrived in the UK in the early nineties with a suitcase. He set up a shop, and built up his empire from there.
During the nineties the UK had a major property slump, particularly in the Northern England, and it was possible to buy up whole streets of houses for a few thousand pounds. So the uncle borrowed heavily and bought a large chunk of the west end of Newcastle. (For a bit more context see here.)
It was a risky strategy, as the tenants had a bad reputation, but prices rose to the point where each house was worth north of £30K.
One of these is his uncle, who arrived in the UK in the early nineties with a suitcase. He set up a shop, and built up his empire from there.
During the nineties the UK had a major property slump, particularly in the Northern England, and it was possible to buy up whole streets of houses for a few thousand pounds. So the uncle borrowed heavily and bought a large chunk of the west end of Newcastle. (For a bit more context see here.)
It was a risky strategy, as the tenants had a bad reputation, but prices rose to the point where each house was worth north of £30K.
Around April 2007 was when I began my journey in property investing. I had a decent amount of money saved up. Being on above average wage and no bad debts I had no problems with serviceability.
Spoke to the mortgage broker who is also IP Savvy and has few IPs under his belt. He advises me that we should consider buying a property in ACT for around $500K in one of the central locations Woden Valley. And then after 3-4 months look to invest in Melbourne for around 600K.
I still didn't trust the broker 100% as I had just met him. Also, not having any IP investing experience I was bit worried about borrowing to buy $500K IP as my first investment. I was researching and learning all along and decided to buy Residex report about top 10 suburbs in ACT to invest. The first one was an outer suburb. Houses with decent land were selling for around $300K-$350K. I felt bit more comfortable with that price range. But I still decided to continue going to open for inspections at properties in Woden Valley area.
Finally, I found two properties around the same time which I liked, one was in outer suburbs (350K 4Bed house) and other in central Woden Valey ($485K 3 bed house). Both places I put in a lower offer then what I was prepared to pay and both places came back with counter offer below what I was prepared to pay. Hence, I had the option to select any property. I decided being first IP, I should play it safe and take baby steps before I start running. So decided to buy outer suburb place. Last I checked had I purchase the $485K property would be worth atleast $700K now. The unimproved land value rose 24% in 2008-2009 and 53% in 2009-2010.
The second suggestion that my broker had made to me was buy the second investment property in Melbourne around $600K in last quater of 2007. I saw few forumites here on SS posting their experiences of making anywhere between 80K to 150K per house and land package deal within 8-10 months. I decided against investing in Melbourne and instead decided to buy land in one of the new estates in ACT and build. Again we all know CG Melbourne went through in past 2.5 years.
I did get some capital growth but nowhere near as much had I followed my brokers advice. It would have significantly boosted my equity which would have enabled me to make more asset purchases. Lessons learnt, pay close attention to when successful and experienced people give you advise.
Cheers,
Oracle.
Spoke to the mortgage broker who is also IP Savvy and has few IPs under his belt. He advises me that we should consider buying a property in ACT for around $500K in one of the central locations Woden Valley. And then after 3-4 months look to invest in Melbourne for around 600K.
I still didn't trust the broker 100% as I had just met him. Also, not having any IP investing experience I was bit worried about borrowing to buy $500K IP as my first investment. I was researching and learning all along and decided to buy Residex report about top 10 suburbs in ACT to invest. The first one was an outer suburb. Houses with decent land were selling for around $300K-$350K. I felt bit more comfortable with that price range. But I still decided to continue going to open for inspections at properties in Woden Valley area.
Finally, I found two properties around the same time which I liked, one was in outer suburbs (350K 4Bed house) and other in central Woden Valey ($485K 3 bed house). Both places I put in a lower offer then what I was prepared to pay and both places came back with counter offer below what I was prepared to pay. Hence, I had the option to select any property. I decided being first IP, I should play it safe and take baby steps before I start running. So decided to buy outer suburb place. Last I checked had I purchase the $485K property would be worth atleast $700K now. The unimproved land value rose 24% in 2008-2009 and 53% in 2009-2010.
The second suggestion that my broker had made to me was buy the second investment property in Melbourne around $600K in last quater of 2007. I saw few forumites here on SS posting their experiences of making anywhere between 80K to 150K per house and land package deal within 8-10 months. I decided against investing in Melbourne and instead decided to buy land in one of the new estates in ACT and build. Again we all know CG Melbourne went through in past 2.5 years.
I did get some capital growth but nowhere near as much had I followed my brokers advice. It would have significantly boosted my equity which would have enabled me to make more asset purchases. Lessons learnt, pay close attention to when successful and experienced people give you advise.
Cheers,
Oracle.
.....on the proviso of course that they say it in a nice and cuddly way that doesn't offend. If they deliver it in such a way as to confront your warm and fuzzy comfort zone, then by all means ignore the content and import of that advice (which obviously wouldn't be construed as advice).
.....on the proviso of course that they say it in a nice and cuddly way that doesn't offend. If they deliver it in such a way as to confront your warm and fuzzy comfort zone, then by all means ignore the content and import of that advice (which obviously wouldn't be construed as advice).
I prefer the awful truth way.... sorts the wheat from the chaff.
.....on the proviso of course that they say it in a nice and cuddly way that doesn't offend. If they deliver it in such a way as to confront your warm and fuzzy comfort zone, then by all means ignore the content and import of that advice (which obviously wouldn't be construed as advice).
What I meant was as long as successful and experienced investor giving you advice has nothing to gain from you and is just trying to pass down their wisdom as a goodwill gesture, don't take it lightly. They have traveled the road you are just beginning.
I don't need to feel warm and fuzzy, that is not my end goal.
Cheers,
Oracle.
