Hi! Perth newcomer here.

I cannot believe this alias wasn't already taken on the forum!

Hello all, I'm Flipper (yes real life nickname), currently calling Perth home. Have finally decided to step out of the shadows after lurking on the forums for quite a while. I am very impressed with the knowledge held here and this forum has been an invaluable resource thus far!

I suppose the best way to describe me would be "Startup Investor". I currently work as an engineer in the environmental services sector, however have always had a keen interest in carpentry, design, landscaping, upcycling and renovation. Whilst it is early days yet, my long term ambition is to surround myself with a quality team to help me deliver value adding refurbishments on established residential properties, both to flip for resale and to occasionally add to a rental portfolio.

My engineering logic tells me to start this process on a pre-1980s fixer-upper PPOR (e.g. Bayswater, Belmont, East Victoria Park), learn from the very best craftsmen while improving the place, then utilise equity or capital gain on sale to move on to the next. It's the only way I can make the numbers work in this mild bout of analysis paralysis I have under current market condition! Needless to say, optimism and due diligence is key, and I have plenty of reading to do whilst I polish my pennies!

Hope to bump into you all on the forums, and possibly in real life some time!



Flipper

 

Welcome and well done on transitioning from lurker to member, always better to join up and interact.

 

Hi Flipper, welcome to the forums!

Reno to sell is a tricky strategy in a market like Perth's at the moment, so practicing on a PPOR is probably a good idea - you can avoid CGT that way and enjoy living in it until the market picks up.

You'll find that unless the market is rising well, the tax and transactions costs quickly eat into the profit of a flip. You might find an equity release works out best for the deposit for the next one.

Keep an eye out for upcoming Perth Meet-ups - they happen fairly regularly and are a good way to meet some local investors.

 

Flip to sell doesn't really work in Australia, its generally something you hear on American shows.

Reason for this is costs, by time you pay sales agency fees (say $10k), capital gains tax (say $50k) and then stamp duty to buy the next one (say $20k) you may as well have stayed with the first one and spent that money on an additional property.

If you have a keen interest in doing the work yourself that helps a lot as you don't have to add tradie's invoices to the above sums, but even without them you can see how it doesn't really work.

You should make good use of your skills - buy houses that other people avoid or are scared away from. Be the one who can make a property good again and the equity gods will reward you.

 

Welcome.

 

Thanks for the welcoming words, much appreciated!

I agree the numbers don't favour that fast US-centric flip strategy. I feel resale would likely only occur if the stars align for significant capital gains over a 2-6 year term - hence my thinking the PPOR approach would suit. Otherwise, refurb to rent which takes a different approach to which locations will work, and what improvements would improve yield.

Insourcing as much as possible is a strategy I definitely support - keeping project costs modest whilst learning valuable skills!

Ears peeled for meetups, thanks for the tip @Jess Peletier

 

Hey @Flipper , welcome aboard.