Didn't think it could get any worse...

Something isn't adding up with the old house. A house does not become unliveable overnight! Nor does it need $150k of repairs overnight. Can you get a PM from another Agency to go look at it? It could be the Agent telling porkies (I've had one like that, & they cost me a lot of $$). Get a rent appraisal from them & feedback on the condition. Can you, or family also go look at it? Assess how bad the property really is & see if there's something that you can do to save on costs.

There seems a few of them lately, doesn't there? OK, they KNOW they made a mistake (the OP), they don't need others to rub their nose in it. Have none of you ever make a mistake either?

 

No kids, mid 30's....If it's even remotely possible, take some time off and get up there to tidy the property up and get it on the market. Liquidate it and the PPOR then beg, steal, borrow to make the short fall. You said it would make you cry but the tears won't last, you guys are young enough to start again with a clean slate and you're going to be spoilt for choice renting in Perth (for the foreseeable future). Pay down that shortfall and then save for a few years, with some luck you'll be cashed up and ready to catch Perth in recovery mode.

With a real vacancy rate pushing close to 10%, little to no dent in the stock on market, net population loss and nothing to buoy the local economy the Gladstone property is going to continue to be a burden regardless of condition.

Unlivable might just be an overly dramatic PM's way of saying that it will not rent in its current condition. Search below is limited to South Gladstone but as you have no doubt seen already, there are plenty in "as new" condition sitting vacant. Unless it's an exceptional property, will cleaning it up really help in a rental market that's already saturated?

Real Estate & Property For Rent in South Gladstone, Qld 4680 (Page 1)

 

It could be possible the pm wants to offload it too?? If the pm has to manage the repair works and there's no rent coming in theres not much in it for them. Vacancy rate would still be high i imagine (10% thanks tyler), i did a 2 second search and there a few unfinished reno jobs around.

People up there are desperate for work so calling around yourself you could get a good price and service. I wouldn't wait for the pm act

 

Think positive! If people want to you put you down, let them do what they want. Use that to push you into action.

 

Don't feel too bad, there's plenty of worse things that could happen.

150k is not a huge loss in your mid 30's.

 

i think ops situation is worse, he will come out with no cash but negative cash

i may be wrong though

 

im late 30s but 150k loss or negative even if I sell my asset is unbearable,

assuming I save $750 after tax per week, it would take 4 years of paying it off,

thats 4 years of no luxuries/holidays or anything,

its a big hit

 

I dont get it how many people feel that mining properties that will evetually recover and recover to its dazzling highs

to me, the factors that made them reach dazzling highs are no longer there so there is nothing to make them rise other than by CPI

however there is the saying buy in gloom, sell in boom,

the true benefitors will be buying when no one else is

so as a general rule, is buying intimes like this , a great strategy?

admittedly Ihave bought in times when the market has been cold (non mining towns)and its never been a bad buy in terms of timing

 

Of course it's a big hit. For those of us who have been home owners as long as I have, it wont seem so big next cycle around. For the Sydney crew who made $1M equity in the last two years from doing absolutely nothing but holding a couple of earlier purchases, $150K is petty cash. It makes me puke somedays, the divide between Sydney and the rest of the country. To those of us from Brisbane, Adelaide and Perth it might as well be a million loss, we cant comprehend the idea of giving that money away.

Well none of us normal working class people can possibly "save" $750 a week. It's more a case of putting the shortfall on a mortgage to pay off at a date sometime in the future when the asset has increased in value enough so that it can eventually be sold to pay off all debt. If there is no other asset to cover the shortfall, Australia has a Plan B, Bankruptcy.

We all took a risk to invest, we knew there is a down side and would have weighed up our actions, the pros and cons. If the pros outweighed the cons, we went ahead. I know I would rather get to old age and say:" I gave it a shot. It didn't go to plan but at least I did something to get ahead. " I would rather try and fail, than not try at all.

 

My point being at least you have you health. There's so many situations that could be far far worse.

150k is not the end of the world

 

I lost more than that at 23 through a side business going belly up from me being young and too reckless. from memory my full time salary then was 45k gross and I had zero other assets.

losses aren't fun but they aren't the end of the world, besides if someone is playing to win they're bound to lose every so often. if someonwe is more concerned with not losing money then theyre far more likely to get middling results which is why so few people reach their goals.

@Ems all the best, I hope it works out for you but it truly is not the end of the world. you will learn heaps from this painful experience and still have a hell of a lot of time to use this knowledge and experience to your advantage in the future.

 

there are more ways to make money than just save or buy property though. there are bucketloads of small business owners around the country who who woulf certainly qualify as being "normal working class people" who have lost sums in the region of what you mentioned and recovered to some extent.

@skater has discussed her difficult situation and near bankruptcy etc in the past and how she recovered to now be in an excellent position, it's difficult of course but of course it can be done.

I can empathise with the sentiment re someone in sydney having a throughly different result than someone elsewhere but that's the way the cookie crumbles. a decade ago perth prices doubled whIle sydney prices did nothing so every period has its winners and losers.

 

Exactly

 

It certainly CAN be done....but it's not easy, and it's not fun.

Like I said earlier, you need the opinion of not just your PM on how bad the house is. Get all the FACTS, not just what someone else says. If it's got to sold at a firesale, at least you KNOW you've done all you can. Sometimes just painting a place will add a heap of value & you may spend a couple grand painting it, to realise $20k more sale price. Or....maybe a bit more money spend on it will make it cashflow neutral to hold onto until some time in the future when you are in a better position to take the loss, or hold until you get a gain.

I don't know if appropriate, but could you try vendor financing?

Please bear in mind I have absolutely NO IDEA what the market is like up there, so those suggestions may not be appropriate.

Sit down & work out your game plan. Don't just rush out & sell, sell, sell. Work out exactly what the loss is per week, and then see what can be done. Keep your PPOR if you can. You've got to live somewhere, so whether it's mortgage payments or rent, there's a certain amount that needs to be spent. Could you move to smaller (cheaper) rental accommodation and rent out the PPOR, making the mortgage & expenses tax deductable? Could you air bnb the PPOR? I'm sure Gockie could help you with ideas. Could you re-locate to Cairns & live in the house, renovating it as you go until you are ready to sell it? There's a lot of options, and none of them are going to be fun....but you've got to make a choice somewhere along the line here.

AND above all else, even though there is going to be some pain involved, remember that it is only TEMPORARY. You can do anything, if you have to, so long as you remember this. There will be short term pain, and lots of it......but it won't last. You will survive and be much stronger for it.

 

the way I see it every investment has a risk,

however, I see real estate is a generally slow and low risk investment path

obviously development and mining etc may be far riskier

but for me its one of the far safer investing options,
to lose $150k, lets assume purchase price $500k,
to be 33% down in a relatveily short period of time, really sux!

for a loss that big must be truly terrible luck and / or a greed and/or a bad investment decision

if one of my props went down by that much I would be devastated

 

Sorry. It won't cost $150k to do repairs. That's what it will likely cost us if we sold now (Well sold before we were issued with the dire statements from the PM) Who know's what now.

We are in Perth and due to business/work commitments are unable to get to Gladstone until next month at the earliest.

Long shot here but is anyone based in Gladstone that could go take a look for us? Or knows anyone willing to do this? We will pay you/them - I will struggle to believe any PM at the moment and builders come to think of it..I'm probably exaggerating here but feel I could trust someone from the forum..Is that stupid??

 

No great idea! An investor would be better than someone who is to gain something.
There's a member at tannum, his name will come to me!(sorry ) Has a kite surfing picture . Its an expensive flight over from Perth


Found him @Jenko could be your guy

 

Thank you. I've messaged Jenko

 

Yes, can be much worse.
We lost $1,000,000 from partners business about 5 years ago now, yes pretty scary and $1M was a lot 5 years ago.... but its the positive attitude and determination/persistence not to give up that will make the difference. In fact silly at this sounds if we did not lose the money I would not be on the road I am on today, this event pushed me outside my comfort zone.

MTR

 

Lots of good advice for Ems here....
I just wanted to add some experiences I have had lately with a PM in regional Qld.
We found a deal on the Fraser Coast that was too good to pass up.
We know it needs renovation to be "easily" rented but we are not ready to go and do the work until early next year.
So we decided to rent it out for 6-8 months...."meet the market" for rent, local PM instructed and leasing agreement signed.
We went back south to finish our projects and plan this new work.

It seemed this PM was out to make some money on non urgent repairs - even telling me that the property could not be rented until (small) repairs were completed.
I went along with this initially until the tenant was settled - but the repair requests never stopped!
Outrageously expensive simple repairs (I have done building)....some damage was recent ( I had lots of photos from the purchase)
So I challenged the PM and asked for a cost breakdown for the "trades" used.

I finished up demanding a list and photos of the required repairs and also asked for the license number of the agency "trades"......

Suddenly it has gone very quiet - tenant is happy - rent is paid - no "urgent" repairs happening. They were using a handyman.

Ems - get the house checked over and fixed up a bit if it needs. Use Gumtree to find a local guy and get a fixed rate.
Don't trust what the PM says.....

Finally - I lost almost $250k on a property deal gone wrong in 2004. Best thing to happen as I have made that back and much, much more.....
Never, ever give up!

Good luck