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Poking or Taming the debt monkey

Discussion in 'General Property Chat' started by Gingin, 22nd Aug, 2015.

  1. Gingin

    Gingin Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    94
    Location:
    Sydney
    Starting at the beginning of the year I decided to sell of an ip that was renovated, in a blue chip area never had problems being rented and was renting very well with great depreciations.

    Purely to take some bread of the table, rationalise leverage.

    Planning to improve other ips to maximise cash flows and restructuring debt. To be ready for the next thing.

    I'm sydney based with a sydney bias and I agree with sash but I think we have a few more years of single digit growth and historic low interest rates.

    Am I the minority here? Or are others doing similar, rolling interstate instead or the opposite high leverage , high yield , borrow as much as possible mentality
     
  2. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

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    14th Jun, 2015
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    Location:
    Adelaide, SA
    In the office we've found a number of our Sydney client's have been in the process of selling to consolidate their debt positions, and then leveraging elsewhere. They would still be in the minority, with the majority releasing their funds to enter into new markets.

    The interesting one is that almost none of the Syd equity releases are being used for follow up Syd purchases - perhaps a market sign that the gravy train will slow there in the meantime.
     
    Gingin likes this.
  3. Bayview

    Bayview Well-Known Member

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    Location:
    Mornington Peninsula
    Does this mean they are refinancing to free up some equity for further investing, Corey?
     
  4. Richard Taylor

    Richard Taylor Mortgage Broker & Brisbane Buyers Agent

    Joined:
    20th Jun, 2015
    Posts:
    171
    Location:
    Brisbane
    Yes Bayview most of our clients are looking to release equity to invest in new areas.

    Avoiding Sydney & Melbourne at the moment and looking at areas where they can still get value.

    Cheers


    Richard
     
  5. Bayview

    Bayview Well-Known Member

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    Location:
    Mornington Peninsula
    AHA! Just as I thought.

    Where's Bullion Barron?

    Set him straight about all those investor loans he keeps on charting here.;)
     
  6. Natedog

    Natedog Well-Known Member

    Joined:
    19th Jun, 2015
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    273
    Location:
    Melbourne
    My own plan is to now consolidate without selling anything though.
    We have purchased property's fairly aggressivley with alot of leverage over the last 12 years in our accumulation phase....like most would do when starting out.
    The second part of the plan is now stockpiling cash and letting the next 10 years of capital and rental growth do its thing.
    We "should" have the ability to choose what to do with our time at that stage.
    But who knows what the next 10 years have in store for us all
     
  7. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,173
    Location:
    Adelaide, SA
    Correct - quite a number are releasing equity through cashouts/refis and then diversifying their portfolio into other markets.
     
  8. ADLInvestor

    ADLInvestor Well-Known Member

    Joined:
    23rd Jun, 2015
    Posts:
    98
    Location:
    Adelaide
    Planning to cash out a little bit of equity from the 2 places that we have, in case we want to buy number 3.. Currently looking for our PPOR. Want to get as close to neutral as possible, and sit back and wait for the next 5-10 years.