what have I done??

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From: Kevin Fielding


Hello All,
I have just jumped in and purchased 2 i.p's in Perth.
1 for $136,000 and one for $132,000.
Both with potential rental of $160 per week.
I am nervous as this is my first purchase.
They will settle at end August.
My stomach is in a knot but everyone says it will be ok. If things don't work out I can always sell them down the track I suppose.
Does anyone have some advice for me at this stage?? it would be very helpful.

Regards,
Kevin
 
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The IP junkie

Reply: 1
From: See Change


Go and buy a nice bottle of champaign ...

There will probably be several time prior to the settlement that you will be thinking even worse thoughts especially when the bank return the mortgage documents for the third time because they've made a ANOTHER clerical error and they're not sure if the money will be ready for settlement and they never guaranteed that it would be and all they can do is do their best ??!!!!!! ( I'd hate to see their worst) and it's not really their fault because your solicitors gave them the wrong details ... but then the vendor's solicitor turn around and say they're not ready to settle because the vendors who are in the middle of a divorce and the wife ( not TW ..) won't sign the release papers because she doesn't want to move out ( still waiting for her to sign...)


Look at you bottle , think calm relaxing thoughts , and then celebrate when it all goes through.

Then when you've finished , or possibly, before you'll be looking for another one

see change
it's better to be guided by your dreams than your fears
 
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Reply: 2
From: Silver Ghost


Kevin,

What you have done is:-

1) just taken the first step towards your financial freedom
2) by your figures, it sounds like you have made a very good deal.

Advice:-
1) Relax
2) Congratulate yourself heartily
3) Look for the next deal.

Well done.

SG
 
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Reply: 2.1
From: Kevin Fielding


You are all so very kind, I love this forum,

thanks,
Kevin
 
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Anonymous

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Reply: 2.2
From: Anonymous


If we're honest, we're all nervous the first time. It's like losing your virginity - and then you can't wait to do it again...

Yer dun good, mate - crack open the bubbly.
 
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Reply: 2.2.1
From: Jeremy Laws


SC is right! Great read SC, and depressingly true!
You've done the right thing, and you will never regret it! Ignore the problems that will happen, and let those two be the first of many!
 
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Reply: 3
From: Phillip Jacovelli


Kevin,

Tell me the feeling in a years time, when your IP's are all settled and rented and your friends who have been thinking about property investing (and advising you what you should and shouldn't be doing) tell you how lucky you are.

Remember, the hardest part of the long journey is the first step.

You're on your way.

PJ
 
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Reply: 4
From: John P


Well done Kevin. I know how you are feeling and given this is your first purchase, it's natural to feel the way you are feeling. I was the same with my first IP. It's called buyer's remorse. You will get over that very quickly and as several others have already stated, it won't be long before you start looking for your next deal!!!


Congratulations


John Poulos
RESI Home Loans Rep
0412 588986
 
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Reply: 4.1
From: Andrew D


I agree with what all the others say.....I am only into property for the last 8 months and I remember thinking...will it rent. What about interest rates....etc. The up side is I still think about it with every property I look at and I think that now this makes me think a whole lot harder each and every time. The truth is that stepping out is better than not stepping at all. So many people just don't have the guts to make the first deal. You have proven your mettle by your actions. As the others have chorused. Well done.

Enjoy
AD

Stumbling blocks are just stepping stones to the successful.
 
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Reply: 4.1.1
From: Rixter ®


Hi Kevin,

I was feeling the same thoughts as you do now before I settled. Then after buying my first IP I asked my self why isnt everyone else doing it? All i can put it down to is 2 things -

1/ they just dont have the knowledge or tools on how to do it,

2/ Fear! Lots go to seminars but dont have the courage to follow through. Thats why the First IP is always the hardest...its all Psychological.

The hardest step is starting, so congratulations because you've now overcome it and well on your way to financial freedom.


Happy Investing,
Rixter :)
 
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Reply: 4.1.1.1
From: Ian Parham


G'day Kevin & All

Well done Kevin!

May I ask where you bought (suburb)? Was it a two party transaction (you and vendor), or through a third party (ie: Club/Group of some description)???

NOTE: No 'names' mentioned is a good way to go on the forum ;>)

The reason I ask is that I purchased a new 3x2 villa in Queens Park in Nov 1999...from a Group/Club. It fetched $175/wk initially (cost 130K). Perth rents have fallen away ever since and I have had to lower my rent to $160/wk currently...better than having it vacant.

Sadly the certain group has built bucketloads of very similar complexes through adjoining suburbs and even straight across the road!!!...not happy Jan! So it has been difficult to let due to the competition/saturation.

Things aren't all bad though as the capital growth has been OKish, but will improve as the rest of Perth metro is experiencing currently. Lower interest rates have helped offset the lower rent return...marginally. More importantly I have learnt so much about IPs, Groups/Clubs!!!, my own capabilities and confidence.

Not trying to dampen any spirits, simply saying that the prospective $160/wk you mention may, or may not, be sustainable. In any case you just have to be flexible in your thinking and get the tenants in until rents cycle round to an improved period....easy peesy ;>)

So essentially, if you find the properties giving you any concerns...relax, maybe think about things from a different perspective, or simply come here and open things up for discussion.

All the best..and well done again!

Cheers Ian
 
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Reply: 4.1.1.1.1
From: Tony Dixon


Well done Kevin!

You've certainly jumped in with both feet.

If you've done some research on these suburbs and not bought blindly, and if you have realistic expectations of the rental returns, then you can't have done too much more without suffering from 'analysis paralysis'.

I know I was nervous as hell about the first IP purchase, and the thought of vacancies.

I'd suggest setting a facility (spare cash, LOC) to cover unexpected costs - repairs, vacancies - so that you can relax when problems occur (and they *will* occur at some stage). You have probably considered this already.

Can you tell us what suburb(s) you chose in the end and why you chose them?

Also, are you going to manage the properties yourself?

Good luck, and expect to learn a lot very quickly :)

cheers, Tony
 
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Reply: 4.1.1.1.1.1
From: Peter Henery


Kevin,
I don't know how may "well dones" you can stomach, but "well done, mate!" I think it's common when you buy your first renter to think that you'll be the first landlord in history not to find a tenant! But wait until you receive your first rent cheque in time AND that is cool. (You mean I can really earn money without going to "work" !!!)
If you haven't done so already , read Jan's latest book. Cover to cover. For the novice or the experienced it's so full of good information.
And make sure your get your depreciation schedule done by a professional. Find an accountant who has some IPs himself .Watch him like a hawk. And then start watching values in your area ready to get 'em all revalued and find number three !
You're already ahead of the pack mate, not many of us kick off with "two at a time".

Champagne mate ! NOW !
Peter H.
 
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