Howdi - my intro

Discussion in 'Introductions' started by DRichoY, 15th Jul, 2017.

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  1. DRichoY

    DRichoY Member

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    Location:
    Sydney
    Hi,
    Only recently have come across this forum and already finding so much relevant info..I know, have I been living under a rock? Been so keen in my learning over the past year or two to be in touch with like minded and friendly fellow investors so stoked to be a part of this.

    About me: Definitely an investor with my training wheels on but learning more and more every week.

    My wife and I own our PPOR in Sydney. The recent uplift in equity lead to me investigating investment options. With property being my first choice I quickly learned of the power of leverage and compound interest and some of the benefits (and pitfalls) of prop inv. I have been pretty hooked on reading up on anything I can get my hands on relating to the subject since.
    The equity realisation in our PPOR led us to our first investment purchase in Tingalpa, Brisbane earlier this year (4 bed 2 bath). Don't know if i've backed a winner but I pretty much wanted a house with reasonable land component as close to CBD as I could afford (sub $500k).
    Before the purchase I got a friendly referral to a savvy broker who has worked hard for our business with plenty of guidance (an investor himself), and after what i've learnt he has structured everything well (no X-coll).

    Currently on the hunt for a second purchase..looking in Northern Brisbane, under 20kms from CBD budget of around $450k. Will be ensuring property cash flow is such that we can hold these (and future) properties for the long term.

    My journey is not without some learning pain.. Got suckered in and lost many hours talking with and being chased by what many lovingly referred to as a property spuiker...I was contacted after reading a free book written by one of this company's Directors. The book was actually quite good with plenty of take away info. I reckon some of you might know who i'm talking about but won't mention names at this stage being a newbie. Lost the best part of 3 months back and forward with different levels of staff at this company - all they wanted was my equity position and earnings and continued throwing "strategy" staff at me for a chat on my property inv plan and to tell me how well they've done investing with their company. I was still thinking they were on my team providing free investment property advice..how naive I was. I luckily wised up to their pitch before speaking to one of the companies snr advisors - no credentials (i asked him several times in the convo), just a sales person who had the perfect opportunity for me that'll cost me nothing a week. Property was in a "Hotspot" development area in Brisbane. Thanks to the book "Armchair guide to property investing" which I was reading over the weeks leading up to this chat. This book very quickly spelled out the tactics of such companies and what to watch out for. Needless to say, I hung up the phone to this bloke never to take another call from this company again.
    I tell this story as I hope many of you out there with my beginner shoes take the time to learn a bit before jumping into off the plan purchases from these development sales people. I have a friend of a friend who I only recently learned got sold 2 units in Brisbane CBD last year with an absolute stack of bolt on features (rental guarantees for the first year) etc...values on these properties has dropped heavily (oversupply) and trying to get solid tenants has been a struggle which is no surprise.

    Feel I dodged a bullet paying a premium for a new build at an inflated price with the above company and did the research myself. I have hopefully made a more sensible purchase in an established home with owner occ appeal in what appears a decent neighbourhood, not too far from the CBD.

    Got a few suburbs in mind in the north of Brisbane on my target list. Any insights or suggestions from you pro's out there - I am all ears : )

    Cheers
     
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  2. Gockie

    Gockie Life is good ☺️ Premium Member

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    Sounds great @DRichoY, welcome to the forum.
    Don't worry about the three months, if that's all you lost, that's really nothing! And you wised up and learnt a very valuable lesson. Property investing shouldn't be rushed IMO. You need to have your sleep at night factor. When looking at where and what to buy, more you can learn about the drivers of the area, the zoning, the demographics (ethnic groups, single parents etc.... Who wants to live there, what tenants will you attract), the infrastructure, the local employment rate, the schools, the yield, the area's supply and demand (in regards to buying, selling and leasing), then the more confident you can be in pulling the trigger.

    I'm also a Sydneysider, I think (not knowing any other specifics of your property), buying in Tingalpa was a good move. I have one further out in that direction in Birkdale myself. I would say they have good potential for prices to rise.

    I have another one in northern Brisbane in Scarborough. It's a really nice area but (relative for Brisbane), a bit far out. I only bought in January, but I have seen price growth there though in that short time, the favourable zoning (if you check the Moreton Bay council website, that council has 4 levels of residential zoning - urban zone and next gen zone are the best - more future potential). The train line will also help the area because at the moment there's a lot of retirees/pensioners living in the area. Having said that, if you are targeting closer in, that's a solid plan and (generally speaking), you can't go wrong. I'd just be wary of flood prone areas. :)
     
    Last edited: 15th Jul, 2017
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  3. DRichoY

    DRichoY Member

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    Thanks for the wise words, will keep these in mind with future purchases - I wasn't looking quite as far up as Scarborough although if we were in a position for a 3rd investment I would be keen on something even further north with a bit better cashflow. Ideally want a house, North of Brisbane but as close to CBD as we can afford. The numbers will need to work out of course..

    Thanks again.
     
  4. Gockie

    Gockie Life is good ☺️ Premium Member

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    :)
    Stick with the idea of staying close to Brisbane, keep reading the forum, and enjoy the journey :). Your plan of buying in as close as you can on a $450k budget is a solid one.
     
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  5. kefa

    kefa Member

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    Just curious did you use a buyer's agent? I'm also from Sydney and looking to invest in Brisbane. Just wondering how you managed the logistics?
     
  6. Sackie

    Sackie Well-Known Member

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    @DRichoY Well done so far. I agree with Gockie, as close to the cbd as possible. I'd definitely make sure it's a free standing home, something old but rentable with the potential to add value later on through reno. Buy OO appeal stock. If the land is bigger than usual for the area even better.
     
  7. DRichoY

    DRichoY Member

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    Thanks Leo. Will absolutely be following this criteria.
     
  8. DRichoY

    DRichoY Member

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    No I didn't use a buyers agent - I really wanted to do the research and ground work myself. Perhaps it's my skeptical nature but I couldn't justify it in my head paying all that money to relinquish control of what is a big purchase for the household.
    Research took a few months online. Then I flagged a number of suitable areas and flew up for a look around. Flew up first thing Friday morning with a stack of inspections lined up then revisited the shortlisted ones on Saturday. This way you get to see the public open home at the same time i.e get a look at who is interested and eyeball the competition. I managed to get through 15-20 properties flying home Saturday evening.

    Honestly, it was hard work and lots of hours but looking back I quite enjoyed being in control of the selection and acquisition process. I am not against using a buyers agent in future or for purchases in states I am not familiar (SA, WA for e.g.) especially as my free time disappears (with baby no 2 landing real soon!!).

    All the best.
     
  9. Sackie

    Sackie Well-Known Member

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    This is an extremely valuable process for any individual who takes their iinvestment business seriously and wants to learn the ropes from bottom up. I have nothing against buyers agents and have advocated for them many times before. But on the flip side, actively engaging in the buying process and doing the DD, research, negotiating etc by yourself is an extremely valuable process and really provides the practical apprenticeship for newbie investors.

    Well done.
     
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  10. Ross Forrester

    Ross Forrester Well-Known Member

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    Welcome.

    Seems like you have a fair bit of experience already and you'll be a great member of the community.

    Great to have you on board.
     
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  11. DRichoY

    DRichoY Member

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    Thanks Ross. Only very early days, still got so much to learn. Look forward to reading further into the PC forums..appears plenty of masters on here!
     
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