My Property Investment Journey - Week by Week

Week 11: 4/6/17 to 10/6/17

What a week it has been. Started to talk to several buyer's agents for Brisbane, which got me quite excited and at the same time gave me confidence that I'm definitely doing enough due diligence (maybe too much, but better safe than sorry).

It's impressive how the approaches vary from one BA to another. I'll write more on this once I finish talking to all the ones I've shortlisted (6 in total) and decide which one I'll use, but for now I'll just say that every BA is different - at least that's my first impression.

Apart from talking to all these BAs, another highlight of the week for me was the PC Meetup on Thursday. It was my first and even though I could only stay for one hour, it was unquestionably worthwhile. The amount of people I got to meet, the information exchange, the overall energy, the feeling of being surrounded by a wealth of knowledge... it's all great stuff and I'm already looking forward for the next one.

A quick summary of a few of my learnings from this week:

- Household Workers' Insurance is cheap and worth it
- The importance of buying something that has car parking
- In terms of loans, I read an interesting article about looking further than just the rate when selecting the lender. An example is the fact that the lender with the lowest rate might be the one with the tightest policy for releasing equity.
- The article also talked about fixed vs variable rates and how a fixed rate, despite looking attractive at first, may not always be the best approach. The bank knows more than you about where the rates will move to, so you're essentially betting against what the bank believes in. Also, there might be exit fees if you decide to break the fixed-rate term.
- Some learnings on quick renovations to increase value and rent:

- 3 key points: street appeal, kitchen and bathroom

- street appeal: the facade, the roof, the tiles etc
- kitchen is key: good appliances, plenty of cabinet space and countertop space
- redoing the bathroom can quite often be a great idea​

- Apart from these 3 key points, a lot of small (or "not too big") things that add a lot of value:

- flooring up to date (polished or stone are better than carpet nowadays, for example)
- painting (obviously)
- windows
- gardens
- blinds
- lights​

- Structural renos are a whole different story, which I don't want to get into, at least for now.
- An important tip is to try to negotiate to have early access to the property with the tradie, so that he can start on it on the day settlement takes place
- Once tenanted, ask tenants what features they would pay more rent for.​

Now, my questions:
- Does anyone know where I can find data for a specific suburb about the OO vs investors ratio?
- If you go to www.realestate.com.au/invest and select your criteria, you can see a graph with the average prices for a specific suburb in the last 10 years. This is great, but not enough: 20 years would be ideal. Does anyone know where/how that info can be found?

I'll wrap this week's post up with a recommendation for a Mobile App: Blinkist. It provides 10-15 minutes summaries of non-fiction books, and the range of subjects is quite extensive, including a lot of ones relevant to this forum: investment, economics, time management, negotiation etc. A lot to learn just from these summaries, and obviously a good way to find out if it's worth reading the entire book. The free version provides one book per day (selected by the app, not by the user), whereas the complete one gives full access to the whole catalog. Not expensive at all, definitely good value for money, especially for those who are always thirsty for knowledge.

Cya next week!

 

Here ya go....
Get the facts the property ad left out

Plus a whole lot of other data too !

Great thread, i'm a n00b going through the same learning curve, exciting isn't it

 

@TadhgMor this is too good to be true, tks a lot! I just hope all the data there is correct and up to date. At first glance it seems to be, especially looking at the low percentage of OOs in some Logan suburbs

 

sqm.com to check vacancy rates, weekly change in asking prices.
Yourinvestmentpropertymag.com.au to check a suburb profile, demographics, demand/supply rating etc, including the info that you're after.
Realestate.com for the basic info
onthehouse.com.au to scan different suburbs and get a second reference on the info I've already got
oldlistings.com.au to find out how long a property has been advertised etc
profile.id is good to get a detailed profile on a suburb.
abs website for other info.

I basically have about 10 tabs open at all times

 

That's really useful, tks a lot @Invest_noob! I guess the only info I'm yet to find for free is the average price for the last 20 years for a specific suburb (could only find for the last 10), everything else can be found in all these websites you mentioned. Tks!

 

Week 12: 11/6/17 to 17/6/17

Another week of phone calls and emails with BAs. Amazing how much you learn just by talking to them. Once I decide which one to use and actually start the process, I'll post my personal views on each one of them, as well as the reasons for going with agent a rather than agents b or c. Hopefully it will be an interesting exercise to see how people will have different views from mine on each of the agents.

One of the main things for me this week is the fact that I started looking a little bit more at the "buy and reno" strategy, and it seems to be something interesting to consider. Still early days, but there might be something there. Let's see.

Also, thanks a lot @TadhgMor and @Invest_noob for all the websites you provided, it's amazing how much info can be found for free. I've also found a few more on my own, and consolidated the full list below, hopefully it will be useful for more people:

- microburbs.com.au
- profile.id.com.au
- yourinvestmentpropertymag.com.au
- sqmreserach.com.au
- onthehouse.com.au
- house.ksou.cn
- oldlistings.com.au
- yourneighbourhood.com.au (Brisbane only)

Each one has its strengths and shortcomings, but there's no info that can't be found when you combine them all.

Well, actually there's one info I still haven't found (at least not for free): price history for the last 20 years for a particular suburb (can't get further than 10 years). If someone knows where to find it for free, please share!

That's it for now, cya guys next week.

 

You're welcome. Just paying it forward as I have been helped by many on here.

 

Another is "allhomes" gives measurements of block sizes. Just type the address in

 

Interesting one, tks!

 

Week 13: 18/6/17 to 24/6/17

Finished my first round of conversations with all the BAs I had initially shortlisted. The list is below:
- Property Zest
- House Finder
- Property Searchers
- Propertyology
- Property Pursuit
- Metropole

These ones I haven't been able to talk to:
- Allen Real Estate --> received my initial enquiry via Website and sent me an email, but every time I try to reply my response bounces back. I tried to send a new enquiry but got no response.
- The Right Property Group --> never got back to me after receiving my initial enquiry through their Website.

Once I close the deal with one of the 6 I've spoken to, I'll write a detailed post about my conversations and impressions around all 6 of them. For now I'm just listing the names.

And obviously: can't wait to have a look at the Census results tomorrow. A lot of useful info there, especially around the ratio of OO's vs investors.

Cya next week!

 

Week 14: 25/6/17 to 1/7/17

I truly wish I had more exciting news, but I'm not quite there yet. I know exactly who my broker will be, who I'll hire as a BA, which area I'll buy in and what my strategy will be, but I'm still struggling with one final thing: I need to finish bringing some money from Brazil over to Australia in order to able to kickoff the whole process (financially speaking). Almost there...

In the meantime, I'll quickly post what happened this last week:

- Read a little bit about how a one bedroom apartment close to the CBD is usually a great investment in any of the big capital cities, but also about how important it is to follow some guidelines to make sure it's a good investment: more than 50 square meters, at least one parking spot, some outdoor space and, finally, no amenities (pool, gym etc) so that strata is cheaper.

- Also read a little bit more about OO appeal and a few things OOs look for when buying: street presence, lighting, open space, ventilation, storage space, living area and a smart floor plan.

- Read a few posts here in the forum (not sure which thread) about how Property Managers can be lazy sometimes and about how important it is to stay on top of them and be ruthless if needed - after all, you're running a business.

- Also read about the importance of staying on top of what's happening in the suburb AFTER you bought. We usually do a lot of research before we buy, but it's crucial to also stay on top of what's happening after you purchase.

- And finally: definitely recommend everyone to subscribe to Pete Wargent's blog, lots of useful information there.

Cya next week, hopefully with some exciting news!

 

Hi Jose, I'd like to thank you for starting this thread, I've been following your thread since you started this and it was very helpful for me because I myself is planning to buy my very first property soon, still working out on the deposit and I am excited with your first purchase too!

By the way, I have a question for you, with all the grants towards the first home owner from the government here in NSW and lower interest rates for owner occupier for p&i loans did you consider buying your first home first live on it for 6 mos and rent it out so that you can claim all perks that the government is giving at the moment? With that you can save BA's fees and Stamp duty fees.

Another question I hope a mortgage broker can answer this, if I buy a PPoR claim the gov't grants, enjoy the lower interst rate from the banks, then in 6 mos you plan to move out and have it rented, what will happen to the interest rate which was initially computed as owner-occupier rate?

 

I am in this boat at the moment, my house is currently being built and I plan on moving from it once my grant terms are met. From what I have read and also talked to the bank about it, I believe the loan changes over to an investment loan and interest rate will change to match the investment interest rate. However I am not 100% sure on this so maybe someone with the correct qualifications can comment.

 

Im a newby to this forum but loving all the info guys n girls

I have a portfolio of 3 ip's in south freo Perth ..
negitive geared but want to start heading the nuetral or positive gears way.
im building buffer in my offset account too

love u all lets connect

Clark Cooper
Cooper Property Groups

 

duel occupancy my friend

 

Hi @SBGP, I'm glad my thread is being useful to you!
I haven't even considered this approach because of two things: I'm extremely happy with the unit I'm renting at the moment and I'm not willing to go through the hassle of moving twice in 6 months. I do know some people who did this, though, and if you're willing to put in the time and effort you can definitely save some good money - that's what I heard from them.

Would be great to get a good mortgage broker such @Colin Rice to answer your second question.

@josh76 thanks for the answer. I would imagine that's what would happen as well, but as you said, probably better to get the view from a good mortgage broker (@Colin Rice, can you help us here, mate?)

@C G Cooper great to connect, mate! Are you from Perth? Where are you considering investing in now?

 

Hi Josh! Maybe that's what gonna happen so in this case I think it's better to take an interest only loan if you plan to move out and convert it to an investment property

Hi Jose! I got your point, I did not consider the hassle of moving to the new house and move out again once the 6-month period is completed. Thanks for giving me your thoughts.

 

@SBGP As I said, I know a few people who happily did this and managed to save some decent money. I just can't see myself doing it: too much hassle and, most of all, time that I'd rather spend on something else. Up to each one I guess...

 

Weeks 15 and 16: 2/7/17 to 15/7/17

Hi all! Received quite a few messages asking why I didn't post last week, so rather than responding one by one I'll explain it here: I was going to post on Monday, but I signed the contract for a property on that day! That made me decide to wait for the seller to sign the contract on Tuesday and only then I would post, so that I could give the news to everyone. Turns out the seller pulled back on the deal on Tuesday, which made me decide to just skip the post altogether and leave it all for this week.

I know the fact that I signed a contract of purchase last Monday comes as surprise to all of you following my journey, considering in my last post I mentioned I was still bringing money from Brazil to Australia and was not in a position to buy, but all of that has been sorted out a lot quicker than expected in the previous week, which got me in a position to sign the contract with the BA and kickoff the process. Exciting times, it's finally happening!

So, as promised a few weeks ago, here's my review on the Buyer's Agents I spoke to (for now I won't disclose who I hired):

- Property Zest --> Run by Karen, who was recommended by a lot of PCers. We had a 40 minutes phone call and I found her a very nice and knowledgeable person and truly liked our conversation.
- Property Searchers --> Spoke to a woman called Carolyn for about 30 minutes and liked her knowledge and explanations, but found her too sales-oriented. They're fully aligned with my strategy (good!) and when I mentioned I could buy up to 500k now or could wait a few more months to be able to buy in the 600k range, she promptly recommended me to wait until I could get in the 600k (good again!) but wanted me to sign the contract right away with a start date of a few months ahead (bad!!!). As I said, too sales-oriented. Definitely not the ones I hired.
- House Finder --> Also recommended by quite a few PCers, Simon is a great guy. I had a one hour phone call with him and met him in person in one of the meetups and got impressed by how much he knows and how respected he is within the community. My only reservation with him is that his strategy doesn't fully align with mine in terms of location, but on the other hand he gets plenty of properties that can grow a lot in value with cheap renovations, which made me consider him despite the strategy misalignment.
- Propertyology --> Completely unique strategy, which I honestly didn't like. I spoke to Simon, the owner/founder, for almost one hour, and my view on him is that he's a salesman all around and, on top of that, not a good listener. Next, please.
- Property Pursuit --> Spoke to a guy called Nathan for about 20 minutes, what a great guy. They only buy up to 12km from CBD, which is perfectly aligned with my strategy. Just like Carolyn from Property Searchers, he also recommended me to wait a few more months until I can get into the 600k range. The big difference (and what a difference) is that, unlike Carolyn, he didn't want me to sign any contract right away, but instead just told me to save the money and get in contact again once I'm ready - and that's how you win a customer. I'm not saying I hired him, just trying to emphasize what a difference it makes to use a honest approach when talking to a potential customer.
- The Right Property Group and Allen Real Estate --> As I said in a previous post, neither got back to me.
- Metropole --> I knew they were completely aligned with my strategy, so I kinda knew what to expect already. The only surprise is that they said they would only buy for me in Melbourne, not Brisbane, despite my preference for the QLD capital. Spoke to a guy called Ahmad for about 30 minutes and really liked him.

So that's it for now:
- 3 good conversations aligned with my strategy (PropertyZest, Property Pursuit and Metropole)
- 1 good conversation not completely aligned but still quite interesting (House Finder)
- 2 bad ones (Property Searchers and Propertyology)
- 2 who never got back to me (The Right Property Group and Allen Real Estate).

Soon (maybe next week?) I'll reveal which one I hired, depending on how things go this week.

(Important to remember that these are my personal impressions, which will definitely differ from other people's. No right or wrong here, just personal preferences)

 

Hi Jose. Nice thread, full of nuggests of good info.

Did you find all of the BA's fees to be roughly on par - or some more than others? I have spoken to quite a number of them and am fully on board with the benefits of what they offer. But am far too hesitant to fork out $15k+ to engage one professionally. Seems quite steep for what you get.