Two down, eight to go...
- Thread starter JamesGG
- Start date
Hiya,
Thanks again
Cheeks, I was open to looking anywhere along the Lilydale - Ferntree Gully corridor. I figured while I'm still new at this, I'm going to stick with the areas that I know.
The property I bought was only the third one I looked at (and haven't seen anymore since). I chose that one because the deal made sense and I was ready to buy (thanks Rolf!). Are there better deals out there? Maybe. But, this one was available and it made sense to me.
Quoll, the aim at this stage is to get ten as quickly as possible (and damn well before I'm thirty!). For now, this will mean highly leveraged. I'll reassess the plan once I hit that milestone, and decide then if I want more property, or if I want to pay down the loans, or if I'd rather move towards living on equity. This could be as much as nine years away; a lot can happen in nine years...
Cheers
James.
Thanks again
Cheeks, I was open to looking anywhere along the Lilydale - Ferntree Gully corridor. I figured while I'm still new at this, I'm going to stick with the areas that I know.
The property I bought was only the third one I looked at (and haven't seen anymore since). I chose that one because the deal made sense and I was ready to buy (thanks Rolf!). Are there better deals out there? Maybe. But, this one was available and it made sense to me.
Quoll, the aim at this stage is to get ten as quickly as possible (and damn well before I'm thirty!). For now, this will mean highly leveraged. I'll reassess the plan once I hit that milestone, and decide then if I want more property, or if I want to pay down the loans, or if I'd rather move towards living on equity. This could be as much as nine years away; a lot can happen in nine years...
Cheers
James.
Congrats...now tell us more
Hiya James
Congratulations on a wonderful achievement. I am very proud of you.
I know that you have worked hard, and smart to achieve this result and feel that if you are comfortable, that many people would benefit from you telling a little more about:
the rejuvenation at your home to obtain a higher valuation
the refinancing of your home
the finance deal you put in place to buy the IP
the negotiation process
I know there is a good story here and feel that many of us will learn from you.
Are you comfortable telling us more?
Dad
Hiya James
Congratulations on a wonderful achievement. I am very proud of you.
I know that you have worked hard, and smart to achieve this result and feel that if you are comfortable, that many people would benefit from you telling a little more about:
the rejuvenation at your home to obtain a higher valuation
the refinancing of your home
the finance deal you put in place to buy the IP
the negotiation process
I know there is a good story here and feel that many of us will learn from you.
Are you comfortable telling us more?
Dad
DaleGG said:
Just had to smile ( a warm and fuzzy one you get as a dad) when I saw this signature
Congratulations James;
looking forward to reading more about the deal (and future deals) I bought my first IP when I was 21 and stopped there for a few years (pity as I was on great money..spent some on women, none on cars and a lot having fun along with the rest of the guys I worked with)
Great Inspirational thread, looking forward to more of the same
Redwing
Dale, if James isn't willing to tell us more, we're relying on youDaleGG said:
. Just kidding.James, well done mate.
I absolutely love it when I see/read of young people making things happen for themselves.
Like others have said, I too wasn't thinking that far ahead when I was 21.
Time will only compound your 'growing empire' into a comfortable future for yourself.
Regards
Marty
Hi James
Well done on this second acquisition.
The first is a real buzz, the second is a deeper thrill - is this really happening? But from there on there is no less of a triumph as each property is added to the mix.
I am, as you know, partial to the outer east, and I think that Lilydale is seriously undervalued.
May you have many long and happy years with this property and always be blessed with good and virtuous tenants!
Congratulations
Kristine
Well done on this second acquisition.
The first is a real buzz, the second is a deeper thrill - is this really happening? But from there on there is no less of a triumph as each property is added to the mix.
I am, as you know, partial to the outer east, and I think that Lilydale is seriously undervalued.
May you have many long and happy years with this property and always be blessed with good and virtuous tenants!
Congratulations
Kristine
Well done
Well done James.
At 21 I was thinking how do I get a job (trap, well seemed the right thing to do back then!).
It's great to see that you are using the "years" and compound to max potential.
Keep up the good work and look forward to hearing about property #7 in 2 years
Well done James.
At 21 I was thinking how do I get a job (trap, well seemed the right thing to do back then!).
It's great to see that you are using the "years" and compound to max potential.
Keep up the good work and look forward to hearing about property #7 in 2 years
DaleGG said:
Like Redwing, I also thought 'Dad' was a nice touch. I could feel Dale's pride from here.
Congratulations James, I'm really happy for you. Good one!!
Cheers
Hiya,
Again, thanks to those who've offered their congrats and best wishes. It's appreciated. (Damn, I feel like I'm giving a logies speech in this thread, I've said thanks so often.)
My story? Nothing too special. I've got a long way to go. Since a few forumites have asked for it though, here it is. Be warned, it's a little long winded and probably more information than was necessary...
I settled on my PPOR in Kilsyth about a week before Christmas in 2004. The exiting vendors had repainted the entire interior and fitted new blinds across every window as part of the deal. I used the FHOG and my savings to buy this one. My actual income was around $24k at the time, and the purchase price was $150,000.
Between then and May this year, I spent occasional weekends slowly improving the value by improving the appearance. We painted feature walls in the lounge and bedrooms, touched up the botched job by the last painters, added some small fittings. Nothing much, and certainly nothing expensive. The courtyard is roughly 8m x 7m, and was a complete wasteland when I moved in. Those horrible little red stones (scourier?), cement, rusted barrels and clothesline, dead plants, you name it. So we pulled the whole lot out; there was just dirt (well, clay in parts) left. We paved about a third of it with some nice new pavers, set some garden beds in with small leafy plants and got some nice little white stones for the rest.
All up, I doubt I spent more than $700 on the lot.
IMHO, the property is now overvalued by the banks. Not by a lot, but enough to make me smile. Before the valuer arrived, I obtained some "comparable" sales around the $180-$200k mark, printed a report showing a natural 15% rise in the area in the last eighteen months and neatly typed up a list of all the improvements made since we signed the contracts.
So, the valuer had a look through, and came back to us with a valuation of $175k, which I was more than happy with. $25k "growth" in eighteen months of a reasonably flat market was just fine by me, thanks. IMHO, I'd be looking at 165-170k if it were to be sold.
Rolf then pushed through a 97% lend on that, paying out the old mortgage and establishing a second loan ($37k or so) to do with what I like. I happen to like buying property, so that's what I'm doing with it, haha!
The lender for the second property would only lend 90%, so this additional loan will provide the 10% deposit, stamps, legals and any other purchase costs. As I think I touched on before, I should still have a bit of playmoney left over to invest or reward with.
Once the preapproval for the 90% loan was ordered, I started househunting. I looked at about 20 on the internet, and physically inspected three. This was one of the benefits of knowing the areas as well as I do. (However, I'm also well aware of my bias towards the outer east, so while I think it's undervalued in parts, I have no doubt there are better areas out there. Obviously, there are worse ones too.)
I inspected the third one on a Saturday afternoon, asking price a very reasonable $175,000. The agent rang me back on Tuesday (slack), where I pointed out a few things other properties had over it (without mentioning their price, for obvious reasons), so she had something low to report back to the vendor. I also mentioned that the finance preapproval was not ready yet, and left it at that. She rang again on Friday to see if the approval was done (now she's working a bit smarter), and it was. I still hadn't seen any other properties since the last weekend, either.
Now, the bank the 90% loan is with was kind enough to provide me with an ambiguous letter that stated my (borrowing) limit was $166,500. I arranged to meet the agent on Saturday morning at her office and told her that's all I could offer. I even gave her a copy of that letter to show the vendor.
What's more, I told her I had only $1,000 available as a deposit due to the refinancing process. She really wasn’t happy about this one, but didn’t have a lot of choice. Because I knew I was well under my borrowing capacity on this deal, I made the offer unconditional and thirty days.
At about two past nine on Monday morning (this week) she rang back. The vendor wasn’t happy with the price, but everything else was fine. She came back to be with a counter offer of $170,500. So, now we’re quibbling over just $4k, which was probably not worth losing the deal over. I would not have been upset to pick up this property at that price.
I felt I could get a bit more out of it though, so told the agent that the vendor could have their price, but I’d need more time. The banks were only giving me up to a limit, as far as the vendor knew, so in theory I needed time to save (they don’t need to know about the other loan I have). Now, the vendor was already edgy about the small deposit, so wasn’t willing to move much on settlement, or price.
So I called her bluff. I told the agent I was pulling out. I had a call within ten minutes saying the vendor had dropped another grand off the price. Again, I sensed a little more could be gained, so gave them two options: $169,500, as requested, but on sixty days, or drop another grand to keep it at thirty days.
End result turned out to be $169,500 on forty-five days, which I am more than happy with. Sure, I gained a measly $1,000 and two weeks from the vendor’s counter offer. Not much in the scheme of things, but good practice nonetheless and I happen to know that an identical unit in the same block sold for nearly eight grand more less than six months ago.
In hindsight, perhaps went a little too hard on the negotiations, but damn it was fun. Yes, I could have missed the deal altogether, but there are plenty of properties around at that price if you look in the right places.
Importantly, I've put less than $10,000 cash into purchasing both these properties (aside from holding costs, of course). All except for the $1,000 deposit on this new one was for the PPOR. That makes me happy.
Thanks again to those who bothered to read all of that. Makes staying up to try ensure (read: think) it made sense worthwhile!
Cheers,
James.
Again, thanks to those who've offered their congrats and best wishes. It's appreciated. (Damn, I feel like I'm giving a logies speech in this thread, I've said thanks so often.)
My story? Nothing too special. I've got a long way to go. Since a few forumites have asked for it though, here it is. Be warned, it's a little long winded and probably more information than was necessary...
I settled on my PPOR in Kilsyth about a week before Christmas in 2004. The exiting vendors had repainted the entire interior and fitted new blinds across every window as part of the deal. I used the FHOG and my savings to buy this one. My actual income was around $24k at the time, and the purchase price was $150,000.
Between then and May this year, I spent occasional weekends slowly improving the value by improving the appearance. We painted feature walls in the lounge and bedrooms, touched up the botched job by the last painters, added some small fittings. Nothing much, and certainly nothing expensive. The courtyard is roughly 8m x 7m, and was a complete wasteland when I moved in. Those horrible little red stones (scourier?), cement, rusted barrels and clothesline, dead plants, you name it. So we pulled the whole lot out; there was just dirt (well, clay in parts) left. We paved about a third of it with some nice new pavers, set some garden beds in with small leafy plants and got some nice little white stones for the rest.
All up, I doubt I spent more than $700 on the lot.
IMHO, the property is now overvalued by the banks. Not by a lot, but enough to make me smile. Before the valuer arrived, I obtained some "comparable" sales around the $180-$200k mark, printed a report showing a natural 15% rise in the area in the last eighteen months and neatly typed up a list of all the improvements made since we signed the contracts.
So, the valuer had a look through, and came back to us with a valuation of $175k, which I was more than happy with. $25k "growth" in eighteen months of a reasonably flat market was just fine by me, thanks. IMHO, I'd be looking at 165-170k if it were to be sold.
Rolf then pushed through a 97% lend on that, paying out the old mortgage and establishing a second loan ($37k or so) to do with what I like. I happen to like buying property, so that's what I'm doing with it, haha!
The lender for the second property would only lend 90%, so this additional loan will provide the 10% deposit, stamps, legals and any other purchase costs. As I think I touched on before, I should still have a bit of playmoney left over to invest or reward with.
Once the preapproval for the 90% loan was ordered, I started househunting. I looked at about 20 on the internet, and physically inspected three. This was one of the benefits of knowing the areas as well as I do. (However, I'm also well aware of my bias towards the outer east, so while I think it's undervalued in parts, I have no doubt there are better areas out there. Obviously, there are worse ones too.)
I inspected the third one on a Saturday afternoon, asking price a very reasonable $175,000. The agent rang me back on Tuesday (slack), where I pointed out a few things other properties had over it (without mentioning their price, for obvious reasons), so she had something low to report back to the vendor. I also mentioned that the finance preapproval was not ready yet, and left it at that. She rang again on Friday to see if the approval was done (now she's working a bit smarter), and it was. I still hadn't seen any other properties since the last weekend, either.
Now, the bank the 90% loan is with was kind enough to provide me with an ambiguous letter that stated my (borrowing) limit was $166,500. I arranged to meet the agent on Saturday morning at her office and told her that's all I could offer. I even gave her a copy of that letter to show the vendor.
What's more, I told her I had only $1,000 available as a deposit due to the refinancing process. She really wasn’t happy about this one, but didn’t have a lot of choice. Because I knew I was well under my borrowing capacity on this deal, I made the offer unconditional and thirty days.
At about two past nine on Monday morning (this week) she rang back. The vendor wasn’t happy with the price, but everything else was fine. She came back to be with a counter offer of $170,500. So, now we’re quibbling over just $4k, which was probably not worth losing the deal over. I would not have been upset to pick up this property at that price.
I felt I could get a bit more out of it though, so told the agent that the vendor could have their price, but I’d need more time. The banks were only giving me up to a limit, as far as the vendor knew, so in theory I needed time to save (they don’t need to know about the other loan I have). Now, the vendor was already edgy about the small deposit, so wasn’t willing to move much on settlement, or price.
So I called her bluff. I told the agent I was pulling out. I had a call within ten minutes saying the vendor had dropped another grand off the price. Again, I sensed a little more could be gained, so gave them two options: $169,500, as requested, but on sixty days, or drop another grand to keep it at thirty days.
End result turned out to be $169,500 on forty-five days, which I am more than happy with. Sure, I gained a measly $1,000 and two weeks from the vendor’s counter offer. Not much in the scheme of things, but good practice nonetheless and I happen to know that an identical unit in the same block sold for nearly eight grand more less than six months ago.
In hindsight, perhaps went a little too hard on the negotiations, but damn it was fun. Yes, I could have missed the deal altogether, but there are plenty of properties around at that price if you look in the right places.
Importantly, I've put less than $10,000 cash into purchasing both these properties (aside from holding costs, of course). All except for the $1,000 deposit on this new one was for the PPOR. That makes me happy.
Thanks again to those who bothered to read all of that. Makes staying up to try ensure (read: think) it made sense worthwhile!
Cheers,
James.
