Unlock Your Financial Future

Hi all,

We are looking to start our investment journey and are finding it a little difficult to know how to progress. We have a PPOR which was valued by real estate at 900K (so lets say $800k to be conservative). Our loan is $530k. Our income is currently $135k (being 115/20 as wife works only part time right now due to two kids 4 and 2 yrs). Single credit card of $10k and no other debt.

Happy to invest anywhere but probably looking more to cash flow positive/neutral/balanced due to current situation. I recognise the first IP will set up the next steps so want to make sure we get it right without inhibiting ourselves down the track.

I am interested to know whether anyone has had any dealings with the group "Unlock Your Financial Future"? Further information can be found at www.unlockyourfinancialfuture.com.au

The group is made up of a number of affiliated organisations which provide the range of services to assist in the investment space. Yes there is a fee but it is reasonable when considering it includes all services in finding and acquiring the property.

My main apprehension is that they seem to be focussed on new builds (not necessarily large scale developments) which they develop through building firms. With this comes the period where a loan would be secured at the commencement of the build and then a period of 6 months where the I/O repayments would come out of out pocket until it can be tenanted. Yes it is able to be claimed but still is out of pocket and only 36% is claimable (my tax rate). They are definitely pushing the tax benefit line.

Much of what I have read encourages established property as the best option... and to avoid new builds (after all from a depreciation perspective you can claim 2.5% for 40 yrs so a property of 20 yrs would still provide tax benefit for the 10-15yrs we would hold it).

Was thinking of just using a BA to find a good investment grade (not stock) property but a bit lost. Paralysis by analysis here.....

Any feedback would be appreciated.

Tim

 

Hi Tim

I'm so glad you posted here before jumping in.

I would try to establish your own team for this rather than using a one stop shop. It's really important that at a minimum you have your own broker, lawyer and accountant.

I would also advise against using a company to buy off the plan properties- they are usually sales agents and will be working for the developers rather than you. They often also get hefty commissions from the developer. Make sure you ask lots of questions before proceeding.

 

Have you gone to one of their seminars? theres a few on, go for the free hat and dont sign up to anything.

Start simple imo, work out what you can afford to buy with a broker and also you personal numbers. Once you work out your numbers that will narrow down the criteria and start highlighing where to buy. I like BA's provided you find a good match for your circumstances and one will buy what you tell them and they wont push you to certain properties.

You will get the same support and guidance (if not better) from a broker and BA without the t-shirts and marketing hooha that signing up to a group will do for you.

 

@T Macdonald, new builds sound like a whole lot of risk to expose yourself. If you do a search on off the plan here and on the previous Somersoft forum, you will find the general sentiment. Brand new properties have premium pricing and are likely to set you back many years unless you manage to time a rising market.

I would be asking the question about what they receive out of the transaction - kickbacks from builders.

Block time in your diary over the next week and read up on this forum and Somersoft (archived forum), build your team, figure out your goals, determine your strategy and evolve it over time and stick to what works for you.

 

hi @T Macdonald , welcome to PC, there are lots of experienced investors, loads of free and good advice.

with these OTP or any new build, be very careful, there is likely a unspoken agenda behind them. Before making any purchase, it is a good idea to spend a few weeks, on PC and S/S, reading through the posts and comments re these types of properties, then you would know why so many ppl are against them.

 

If they are involved in the builds then they are not working for you.
Someone who has vested interests that opposes your interests are a red flag.
Get yourself a team (MB, BA, conveyancer) that works for you.

 

Red flag 1.

Red flag 2

Red flag 3.

 

I agree many red flags are just on your post that I don't have to read their website.

As other have pointed out setup your own team, my mortgage broker isn't my accountant, my accountant isn't my financial planner and my financial planner isn't my mortgage broker.

If my accountant can do financial planning and/or mortgage broking but we choose not do use them as I want as many sounding boards as possible.

If my accountant said do this, I would speak with my financial planner to get their ideas and vice versa. If they both agree (or disagree) it is a good idea that gives me some comfort level in what is being proposed but would still do my own DD - however if one agrees and the other doesn't then I have will need to pay more attention and make up my own mind which way I am leaning towards.

Reducing your tax is not the reason to invest into property - as reducing your tax means you are technically losing money.