Positive Cash Flow Property - am I getting this right?

If I was you I would reach out to one or two of the mortgage brokers on the forum as you will have a higher chance of finding someone you like and you can also read about them and how they think prior to making contact.

 

Unless your giving financial advice I would suggest you not tell people they are wasting their time seeking financial advice. As a financial planner who loves property I find it a bit rude.Offcourse op should do her own DD but don't class professions as useless.

You may not be aware but financial advisers have access to listed property which is indirect property investment. You do not have to own property directly yourself to invest in property.

 

I doubt it's personal, just a generalisation about avoiding financial planners (probably away from here or SS) who aren't familiar with property investment.

 

Hi Big Red,

The OP is talking about her next IP, already having one. She clearly wants to grow a property portfolio and I gave my opinion that FP will be a waste of time in this area and its best to see a finance broker. I have also said in the past that there are some FP on this forum who are very successful property investors and personally I would have no problem to approach them.

It is my personal opinion that any advisor, broker, financial planner or mentor who is not already financially successful with the instrument the client is seeking success with is just a waste of time.

 

No its definitely not personal. Just like i wouldn't waste my time using a BA from Melbourne when i live in Sydney.

 

No probs

 

As Jess mentioned- it is VERY important to restructure your loans NOW!
You are paying down deductible debt and then you will borrow non-deductible debt to buy a PPOR, thus wasting $1,000's of dollars.
By having your loans as P&I and putting the extra money in the offset you casn then take that money out of the offset for your PPOR and still have the money as deductible. Get as good broker NOW!. There are some on this forum that I'm sure will steer you in the right direction.

I think anyone with property that has been to a FP knows this as that's what they push when you mention property (in my case anyway). I did the FP run around for years. I wanted to buy property (directly) and no FP could assist me with that. A broker with a good property portfolio is the way to go (in my opinion anyway).

 

Exactly @Travelbug . It is what it is and I have no agenda whatsoever (not saying others do). I don't filter my comments usually because i think the world has gone abit mad with being PC all the time. My only 'agenda' is that newbies get unbiased information that will have the best chance to benefit them. And many have posted in this thread to see a finance broker as opposed to another profession because through experience, they also know the score. I think newbies have enough difficulty navigating through the property investment world without adding extra hurdles.

 

Thanks for all the advice everyone, really appreciate your comments. A few ah-ha moments for me over the last few weeks! my loans are now fixed to interest only , I've found a replacement accountant who specialises in property (as after research I found my current accountant provided the incorrect advice about my trust options due to their limited knowledge of other states) and now on to sorting out which broker to use….then I should be defiantly on the right track!

 

This is a great thread and shows how well PC users can help us beginers get over the hurdles at the start of the property journey.

Only thing I would as is did you change your loan THEN start looking for a broker?
Just I think it's best to get the broker from step 1 to stop you making any mistakes.

 

We used an FP a couple of years ago. Recommended by accountant. The sell sounded logical but the delivery of the recommendation took forever. And in the proposal, they steered towards funds. Properties were no no.

I was totally uncomfortable with the slick car salesman feel of the operation. We paid the $4-5k for the report, and got out. Didn't want to throw our any more of our hard earned $

 

Luckily only cost you 4-5k.

I speak to many buyers, investors etc almost on a daily basis and if I could count the collective net worth lost by them from listening to poor advice from inexperienced FP, it would be in the millions!

 

Definitely a good point. A few clients have reached out to me after changing a loan either direct with a bank or having an existing broker (who they're not satisfied with) take care of a top up/refinance/new loan and we have a little work to do and a few extra hurdles as a result.

Always worth having the chat before doing anything.

 

This is bad advice! You don't need a broker to be near where you live! You need a KNOWLEDGEABLE broker, who deals predominantly with investors.

Most people only have one property, so, by default, most brokers deal with people who want a mortgage on a PPOR. If they are lucky, they might get a few clients with a couple of properties. Most of the time, any broker can deal with these people.

What you need is to find a broker with specific knowledge for people who want to grow an investment portfolio. For that reason, I would start by taking to a few of them here, as these brokers are dealing with investors every single day.

 

Hi Big Red
As you would know LPTs are a totally different beast to owning property directly. The whole sector was smashed after the GFC when stocks like GPT more than halved in value when capital raising is considered.
LPTs have proven to be fairly volitile and can only loosely be compared to direct property ownership IMO. I think that is what you might be taking about?

 

This is fantastic, no nonsense, accurate advice imo. Any newbie starting out and wanting advice on finance should read this post and just follow it! That's it done. Finance issues sorted. Next step please. There are so many good posts just floating around amongst.....other posts....and the same questions get asked over and over and over..

 

And of course investing in LP's pays the adviser a commission also (Don't worry Red i am a Licensed FP also but wouldn't put my clients into LP's).

Transparency and disclosure is key in any form of advice and FP's don't have a great track record in acting in the client best interest.

Cheers


Richard

 

Good post.

Looking for a nearby broker (when technology removes the barrier of distance) is like deciding only to invest in property on the street you live. Greatly and unnecessarily limits what's possible.

 

I have to agree with @Big Red. Seeking a financial planner is not a bad thing and I have no idea why so many people on this site are negative about someone advising a newbie who is starting on their investment path to see one.

A good financial planner will work around your situation and requirements.