Picking yourself back up.

Hey guys,

New to the forum but i have to say this the best resource i have come across. Lots of reading to do. Thanks to you all.

After a few good buys i am dealing with the fact that I have bought a complete lemon. Fortunately it is a only slightly cash flow negative lemon but still a mistake that will derail my journey.

I don't want to go into the details of it here and know everyone can make mistakes but can anyone tell of what they did after buying a dud?

Thanks

 

Assuming you are right and it really is a 'dud' (cos some people think no growth in a short period of time is a dud) which it isn't, assess all your options. If there is a way to off load it where it makes financial sense then consider it. If it makes more sense to hold it and it wont impede you continuing to grow then consider that.

Ultimately getting into deals that are less than stellar is something I think everyone does from time to time. Just know its normal, then work out your best path forward, whether that means to hold it or sell.

One thing to not let it do is affect your mindset too much. That's where the REAL damage can be done, and many people become unstuck after a 'negative' experience and are unable to grow any further due to paralysing fear. That's the bigger danger to be aware of.

 

Sure, held onto it for 13 years negatively geared most of that time, dealing with bogan tenants constantly and then sold it for only slightly more than what I paid.

 

A lot depends on why you think this property is a dud. Is the problem short-term, medium-term, or long-term? Is there anything you can do to minimise or alleviate the issue?

You have bought before, so it seems unlikely that it is something glaringly obvious.
Marg

 

Thank you. If you did it again would you sell up sooner and take the loss? I am going to talk to my accountant about this for this years tax return.

 

I see the problem as long term. Bad area and properties in the same block now selling for less than what i paid. My gut is saying to give it another year and if no growth then take the loss.

 

This is what i know in my heart and need kind souls to reinforce. Thank you

 

Then keep 30th June in mind.
If liable for any cgt this financial year it may make sense to sell before then if making a loss.
Marg

 

Yes. When I bought that one I was young and stupid. Didn't know what I know now so hopefully I never make that mistake again. It's cliched but you really do learn from your mistakes.

 

Love it. Hopefully a signal fault.

I am a maximiser, not a satisficer so tend to blow things a little out of proportion but its the way I manage risk. It drives my wife nuts.

 

Its easy to avoid duds - just do nothing like 90% of the population.

Sounds to me like you just accidentally diversified your portfolio

 

You make me laugh

 

One way I am looking at this is generationally. My parents has little to no financial prowess. I have stuck my foot in it so my kids don't have to. Take the lesson, teach your kids and move on.

 

Don't immediately worry without first knowing whether it is actually a 'dud'. Talking to your accountant is a good start. Take the emotion out of it and only look at it logically and by the numbers. However, as mentioned above, the best thing to do is to not let this affect your mindset. Mistakes happen but if you learn from this, you'll avoid it in the future. Good luck.

 

be brave and go into detail.

 

buying a dud is due to your own fault. Nothing more nothing less and most likely due to not enough knowledge not doing enough research, nativity or all of them combined.

Its harsh but the truth. But thats how you learn.

 

Most accountants aren't that good at deciding if it's a good investment or not. Unless your accountant is financially secure himeself, then I'd take any advice with a grain of salt. My accountant is there to do my books....nothing else.

Absolutely

You are here in the best place possible to gain advice on property investing, and you won't go into detail? That makes absolutely no sense whatsoever. If we're being honest, most of us have bought something, only to breathe a sigh of relief when it's sold, but it depends on whether or not you can make lemonade, on whether it's a really bad investment or not. It also depends on the reason you think it's a bad investment. Without us knowing WHY it's a bad investment, how is anyone able to give you any advice, or share what they have done in similar circumstances? There are hundreds of reasons why something could be a bad investment to someone, while the next person just see's an opportunity.

 

Buying first property is like first gf/so/wife etc..there is a high possibility it will be a dud
(fully expecting rebuke from the females on this forum)
I have to agree with @electronic_exp...
This is how to learn. I don't know your situation well so can't comment in detail..I would probably say if it's not too bad.. Maybe hold but if it is bad and you don't see any cg in the near future and is costing to hold - a clear liability than an asset forecasted out to future.. Then consider dumping it.

 

was it in regional??