Did you Sell any properties during the boom Cycle (2013-2017)

I hope you have a fat cheque book or an international airport

 

Brisbane market has still got way to go and in-fact some really good deals to be found..

If you have the equity/deposit and serviceability, it's not a bad time at all to enter brissy market !!..

Cheers,

 

Not particularly worried about exposure to the Brisbane market and there is some specific value adding to do.

Also along the lines of @kierank we need to start organising things for retirement.

Markets will do what markets do - if everyone agreed on the future market well then there would not be a market. You need buyers and sellers.

 

Interesting to see people on both sides of the argument, as opposed to 12-24 months ago when Brisbane was tipped to take off. Markets within markets and all that jazz.

I can purchase up to ~$550k with current conditions, and the loan specialists said I could get it up a bit higher if I play around with some of my debt - like using equity to pay off my car and reducing my credit card limit.

 

$550k is decent amount to invest in Brisbane market ..

I just bought another one only couple of weeks ago..

Yes sir, markets within markets... Fun of being border-less invest ...

Trick is finding the right opportunities and that market does have some good things to offer!!..

 

One thing to consider, and this happened to me

My interest only loan reverted to interest and principal an increase of $3000 per month on my $1180000 Loan/LOC

I ended up refinancing with another lender IO, this wont necessarily be possible for investors if they no longer service debt or the property value has dropped

The credit squeeze will impact on every investor when loans revert to P&I that equates to 40% increase on repayments

 

Of course you can.
Success comes down to patience, persistence..... I have had many sleepless nights.... Its not all beer and skittles as they say.

In current climate..... its not about the number of properties you own, its about cash flow/income streams. Managing debt, keep LVR at manageable level where you can service debt if interest rates rise which is happening.

 

Extending interest only period in the past was just a phone call to the bank..

Now days it's lot more involved.

Will be interesting to see if this becomes the new norm or banks will ease again when market slows right down ...

 

I'm going to leave my loan at P&I even though we're moving - I just locked it in at 3.8% fixed for two years. May go IO on the next property, but I'm guessing the rate will be in the low 4's instead of the 3s. It just felt better to pay down some of the principle, especially since I can draw the equity out anyway.

MTR - you're probably able to get quite good rates as it sounds like you have a few properties and projects going on - do you tend to stick to IO?

 

Yes

Now its basically taking out a new loan you need to

- provide financial
- your property will need to be valued
- Not sure about which lenders, however some wont refinance IO if you are over 50 years

Now, just imagine for one minute..... you are retired with xx rental properties the impact of your income if your repayments have increased by 40%. Many will have no choice but to sell investment properties.
No one saw this coming....APRA worked.

 

Your reply here is the exact reason why in retirement I will carry no debt. I have only 3 IP's, which is not many by some peoples standards, but own 2 outright and under 35k to pay down on the 3rd and have 18 months to erode it. I have never used IO for any IP purchase. My strategy was to have a larger upfront deposit before purchase.
Retirement, to me, is having as little to do as possible to receive an above average income stream.

 

That's good that you are managing the risks.

I have been through at least 7 property cycles, and survived, but I have had some ups and downs. Fortunately its paid off. I still believe you need some luck in your life, its not just about strategizing.

 

No one's got the crystal ball but I think banks will ease down again once the market settles and they want to grow books faster (still at-least year away) ..

Cheers,

 

Having had a RC into the lending practices of the banking industry and its flaws, how do you see them being able to open credit avenues in the future?
My feeling is that credit will remain difficult to attain.

 

Yes I agree that developer finance will move away from banks and into more private financiers.

 

Currently many developers are struggling to source finance.

Also anything over 4 unit sites will require commercial loans. I don't know how difficult this is, last development loan I got was for my 4 townhouse project in Melb, and I used resi loan, low doc, RAMS... that was brilliant. Not sure whether this product even exists now??

 

I sold two in Geelong and bought another in the north-eastern suburbs of Melbourne.

 

When you are in business of lending, how long can you control remains the question?

But won't surprise either if this is the new norm!..