Another day. Another young property investor

Good on him for doing this at such a young age. I was still deep in Uni at that age and didn't even have anything in my name.

Interesting that he/the journal calls semis' townhouses? Maybe this improves valuation??

No problem with him being affiliated with binvested but I think the last few properties are from them? Worth disclosing that.

Cheers.

 

I think we might have seen some posts from this guy - certainly very sensible.
Looking at the bank valuations - now that I know he's with binvested I question those. The purchases themselves are great and apparently he did this part on his own. Could he have done so well without such optimistic valuations? The perennial question.

 

What did they reckon?
Did you get heaps of likies?

 

Nice article, just leaves me wondering, should us young ones be looking for the lower value properties to.make that rental yield or does it not really matter. I always felt like the slumdog land tycoon doesn't work, due to the lack.of CG potential. Article has made me.rethink that line of.thought

 

At the end of the day it's all about the numbers. As long as the numbers work.

 

I didn't really have an option but to invest in the lower end market. As long as you buy right, numbers add up and have a good PM in place you are very limited to adverse risks. The things I've learnt is the lower end of the market really doesn't have much room to fall lower compared to medium and higher end properties. A lot of tenants are very respectful to be allowed to rent mainly because they have probably been denied for better applicants in the past. I've have numerous single mums, immigrants and divorcees. All pay on time and never complain about petty problems which I feel middle and higher renters would be able to as they have options to go to other rentals.

 

I think this is a very fair call.

 

I remember trying to learn the song lyrics so I can sing better to impress the girls at karaoke bar when I was 24. This kid is killing it.

 

Did you impress any?

 

Is he kind and nice? That is the only thing that really matters about a persons "assets".

 

if it helps he was really lovely to myself and my colleague. Hoping to chat property again some time - a complete pleasure to speak to.

 

seems like you believe in PC too much

 

I'm plagiarising comments from Facebook but good to get the real answers!

Was it a coincidence he worked with nb or does nb pay for these stories?

 

Definitely a huge improvement on the last one of these articles as it includes way more data.

I can't comment on the other states, but those bank valuations seem like absolute ******** to me.

Woodridge Apartment $105k > $150k in 1.5 years, meanwhile prices have fallen over the last 12 months in Woodridge for Apartments and houses have only gone up 2.5%-ish

Surfers Paradise $169,000 > $220,000 in 1 year 2 months, meanwhile prices in surfers for 1 & 2 bedroom unit stock (all you would get in this price range) has gone backward 0.5% - 1.5%

I don't see any mention of renovations in this article, I would be really interested in a follow up article detailing how someone makes 30% capital gains in roughly 12 months in a market that is going backward without significant renovations.

"Many of his sub-$150,000 purchases rent for in excess of $250 a week." Gotta love comparing purchase price to gross yield on apartments.. If I do that my most recent buy (also in QLD like 3 of his apartments) is up in the 6%'s while he's down in the 5%'s. Net yield after body corporate & strata is a very different story, especially on predominantly 70's & 80's "cheep and cheerful" $100k gold coast properties.

 

@Plutus purchases bmv. Gross yield is an easy way of assessing a deal, you don't use that as a guide??

 

Not sure if anyone has realised this but the LVR that was given is most likely "original loan vs current market value". There is a big possibility of this being misleading as he is on low income so he would have extracted equity from his property that he bought earlier (ie more loan) to buy more properties. Hence I am quite certain that his LVR should be sitting around 80% or more. In fact, my calculations shows that he is on 90%+ LVR.

Nothing wrong with having a high LVR at this age but I think the article should be more honest about this. This is on top of the issue that many has pointed out which is valuation coming back at obscene amount of growth which doesn't match the area statistics. I assume this means more equity released to do major renovations to achieve these valuations?

 

Coincidence. He approached me. We do NOT write for pay under any circumstances. If that's done it counts as sponsored content, is labelled as such and is not written by the in-house journos.

 

I asked him for the LVRs but didn't consider this. Thanks for pointing it out.

 

I have made the same gains as him in $$ in capital gains in the same time frame but from one property but at less cost... Many ways to skin a cat. Good on him but agree there should be more DD in querying the valuations people provide.

I am sure Jen did but you cant really right in an article that I have checked a sample of the properties or put in brackets (yes I did question their valuation compared to median prices).

 

Your calcs must be out - if he has paid a total of $832k for all the properties using 100% debt, then $832k is max debt he could have. Compares to market value of $1,170k, which is 71% LVR. With stamp duty & initial deposit, 69% is probably about right.