Two down, eight to go...
- Thread starter JamesGG
- Start date
This is an old thread - a little over three years, now - but I thought that I might post an update for this particular property.
It's on the market for sale.
It was interesting to read back over this thread. As I quoted above, a lot can happen in three years, let alone nine. My investment philosophy has changed remarkably and whilst I've moved on to much more interesting deals since then, the experience gained from those first baby steps has been invaluable.
That $1k of my own cash that I put into the deal will yield maybe $50k upon sale, all going well. If you count the equity taken out of my ppor at the time, then it's approximately doubled the input in three years. That's at least a year too long by my current standards and part of the reason why it's about to go.
I believe that the $50k that I should nett from this can be much more effectively invested than where it is now. The property is approx $150pcm cashflow positive, but I feel that I can do much better than that elsewhere. The expected capital growth for this property, in my opinion, is minimal for the next twelve months.
I'll work out exactly where the proceed will go once the cash is in my pocket and I know how much there is to play with. All good fun.
It's also interesting to read through the thread again, three years on. There don't seem to be a lot of threads anymore with such detail, and I'm guessing it's because of how a few of the recent deals have been, say... 'attacked', perhaps, isn't the right word; but you know what I mean.
The people in this thread are interesting, too. A few old favourites still around, a few quality posters gone, and a few who changed their name. Funny how the forum has also evolved significantly in that time, as well.
Looks like your doing well here.
But I hope you have you taken a very close look at your net proceeds after selling. Preferably with the help of an accountant.
Many bites will be taken out of your pie along the way before you get the final check.
But I hope you have you taken a very close look at your net proceeds after selling. Preferably with the help of an accountant.
Many bites will be taken out of your pie along the way before you get the final check.
Hi James,
Is that 50k before or after including initial purchase costs/stamp duty, negative gearing loss in the first couple of years (after tax cost), selling costs and approximate CGT next financial year...?
I wouldn't think there'd much left over after that, but could be wrong... ?
I think it is the right word. Your detail on post # 37 is exactly what is missing IMO from this forum. That is where the nitty gritty learning is for all participants to do the actual deal.
High level fluffy stuff only gets you so far. General comments and mindset stuff doesn't get signatures on paper. Nitty gritty does.
I counted about 8 posters still contributing from the 40 odd from only 3 years ago.....the rest have left. So much experience and knowledge that has gone. I wonder what they are doing ??
Thankyou. So far, so good and I've now made a habit of exceeding my own expectations.
Thankyou for the tip, too. I *think* that I should have the numbers covered, ran a spreadsheet over the weekend that should cover most of the variables. We'll see how it washes out but the main thing will come down to how well the agent negotiates on the sale.
$50k nett is what I'm hoping to hit my bank account at the end of this, after sales costs and paying out the loan. CGT will come later, no doubt, but that won't need to be paid until June 2011. I'll worry about it then.
Initially, I put $1k on the contract, plus I borrowed $24k to fund the deposit and stamps and legals etc. That property has also been sold already; proceeds paid of that loan and the remainder re-invested. The return from that has been far greater than if I left it in the old PPOR. I had also refinanced and redrawn on this property since purchase so loan value is higher than originally.
Slight aside; I remember a few days before settlement of the purchase I was in Adelaide. I had to get a bank cheque while I was there to make everything happen on time, so ended up carrying around a bank cheque for $24k in my pocket for the afternoon and the flight home. That was equivalent to about nine months' wages at this point.
Anyway, the property has been positively geared for awhile now. That initial six month lease expired shortly after settlement, rent was raised and again a few times since. So, initial negative gearing has been taken care of already.
I'm happy with this decision. Onwards and upwards, now
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Thankyou. And agreed; it's the fine print that makes all the difference and it's unfortunate that there's less of it here now. I've been guilty of that, too, admittedly. But jeez, this thread made for interesting reading.
And I didn't count, but wow. The change of personnel speaks volumes.
Hey Dazz!
We're still here - maybe we should get a life, hey?
More than 8 years on the Forum for me - and I'm still doing those detailed posts, still getting shot down in flames!
Hey James - good on you for taking the punt and making the investments in the first place.
I once worked for a chap and when I told him about the Mission Brown place, instead of saying 'Hey, that's great, well done', he said 'Imagine how much more money you would have made if you had bought in Hawthorn!'
Well, Doh!
I didn't have the money to buy in Hawthorn, even if I had wanted to which I didn't.
I bought what I could afford when I could afford it, as did you three years ago.
You have done well and for a young bloke you have done very well.
Make sure this fantastic stuff called 'capital' goes to work at least as hard for you during the next three years as it has done in the past three years
Cheers
Kristine
Thankyou, Kristine.
Yes, the plan is to reinvest the proceeds. No doubt in my mind there. It won't be enough just on it's own, but combined with other resources... I've got my eye on a couple of commercial properties atm. We'll see how it goes
I've got my eye on a couple of commercial properties atm. We'll see how it goes
Great read!
So when you say you've discovered bigger and better things, you're moving into commercial? Will you continue to invest in residential or focus on commercial entirely?
James,
Good work mate. One of the best lessons to learn is to NOT get bogged down in any one strategy. If the environment changes then you've got to move with it. If you can make $50K net out of that deal over three years, and more importantly put the proceeds to better use, then go for it!
I can't believe that was three years ago. Seriously feels like just yesterday. But I'm feeling a bit old today as I just ticked another year older and am knocking on 40 now. Life goes on but a bit blue today...
Well done champ!
Cheers,
Michael
Good work mate. One of the best lessons to learn is to NOT get bogged down in any one strategy. If the environment changes then you've got to move with it. If you can make $50K net out of that deal over three years, and more importantly put the proceeds to better use, then go for it!
I can't believe that was three years ago. Seriously feels like just yesterday. But I'm feeling a bit old today as I just ticked another year older and am knocking on 40 now. Life goes on but a bit blue today...
Well done champ!
Cheers,
Michael
I'm still here too.
Good thing, too. Thankyou for your advice over the years, even when not directed at me.
Thankyou, too. No, I still have interests in resi and will continue to do so. The next deal in mind, though, will be commercial. Also looking to increase my share trading in the short term.
Cheers
Cheers mate, 'preciate that. Yes, I would agree that a flexible strategy is vital in a changing market. Consistency goes out the window and for me, it's about finding how to get the best returns *now*.
And yeah, a little over three years ago. Most of the time, it seems so much longer to me; so much has happened in the meantime. But then again, I always have to stop and think when asked how old I am. Being 24 doesn't feel quite right most days.
