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A little bit Nervous; New house
Topic Started: 29 Aug 2015, 04:10 PM (2,359 Views)
Jimbo
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zaph
30 Aug 2015, 01:16 PM
How ironic! Didn't you sell your PPOR as an investment decision?

A decision made by my missus and myself based on number of factors.

At no stage did we have to ask people on a forum for advice.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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zaph
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Jimbo
30 Aug 2015, 03:52 PM
A decision made by my missus and myself based on number of factors.

At no stage did we have to ask people on a forum for advice.
krrenafopierhjaiperjfdvipafe... Aka then you should not give forum advice.
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Trollie
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Jimbo
30 Aug 2015, 03:52 PM
A decision made by my missus and myself based on number of factors.

At no stage did we have to ask people on a forum for advice.
Another foot in mouth moment for Jimbo
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Jimbo
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John Frum
30 Aug 2015, 09:04 AM
If the answer was as clear cut as your saying implies forums like this wouldn't exist.
Deciding to buy a house to live in is not an investment decision. Deciding to wait it out is an investment decision.

Deciding to buy in a potential growth suburb in the hope that it will help you leapfrog to a better suburb in the future, is an investment decision.

Where the barbeque brigade get is wrong is their belief that their home is an investment.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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Strindberg
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Jimbo
30 Aug 2015, 03:52 PM
A decision made by my missus and myself based on number of factors.
You gave us the reasons just one month ago why you sold your property.
ALL the factors you offered were based on investment issues. Zaph's comment is entirely appropriate.

http://australianpropertyforum.com/single/?p=8566268&t=10336276
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This time last year, I sold my property in beachside Warnbro in Perth.

I've lived through property and economic downturns before and I could see the signs flashing red all around me.

With Perth being an isolated city with an economy heavily resource based, it was pretty easy to see that upturns and downturns would be exaggerated.

Perth experienced meteoric and unrealistic growth in the first half of the last decade. I have never earned so much money in my life. Money for old rope to be honest.

Anyone with a pulse could earn a minimum $50k a year just for turning up to work three days a week. Forkies on $25.00hr plus penalties, RDO's, sickies, holidays, super.

If you had any skill that could be translated into mining construction, five figure salaries became the norm.

Everyone was getting rich and spending rich. Seventeen year old kids in $60k utes, Bali five times a year, $5.00 lattes on the way to the office.

To grow their wealth and reduce their tax burdens, the new rich started to build up portfolios of investment properties.

Buy a cheap house, rent it out to someone who you have just priced out of the market. Get a kickback from the taxman.

There was no shortage of renters with Kiwis, Victorians, Poms and Paddies flooding into the promised land to get a slice of the pie.

But around about 18 months ago, things started to change.

Forward order books started to shrink, China started to slow down, red dirt started to drop in price and not as many people turned up to the party.

By January last year, it was pretty obvious what was about to unfold.

The state government tried to add stimulus into the property construction sector by making established property less attractive (stamp duty and grants).

It worked for a bit and land sales went mental. Construction went mental. New houses meant more supply. Both for rentals and sales stock (both up by 40%).

But all the state managed to do was bring demand forward. When you do that, you take demand away from the future. Today is the future and land sales have collapsed.

It follows that construction will collapse (in the next two to six months).

Rental vacancies are increasing at an accelerating rate.

So Perth now faces the double whammy of increasing supply over falling demand.

Rents are down 6.4% on the year and 15.3% over three years.

Selling prices are down 2.43% this quarter and by 1.66% since I sold.

Forget the fact that I shorted the AUD with my equity and tell me this.

Did I do the right thing?


As for shorting the AUD with your equity, have you forgotten that you told us that on May 8 you actually exchanged a heap of GB pounds (more than AU$300k worth) for AUD when the rate was 1.9627 (now 2.146)?
http://australianpropertyforum.com/single/?p=8552011&t=10307463
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Jimbo 8 May 2015, 12:28 PM

I've just hedged half of my outlay and quit at $1.9627.

http://australianpropertyforum.com/single/?p=8552099&t=10307463
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Jimbo 8 May 2015, 05:57 PM

My nett return was 3% in 20 hours for a simple trade.

It was a largish trade, six figures with a five figure return.
"Did you do the right thing?"
Jimbo
30 Aug 2015, 04:14 PM
Deciding to buy a house to live in is not an investment decision. Deciding to wait it out is an investment decision.
The contradiction between your post #3 (in which you effectively say price rises AND price falls are irrelevant for a PPOR) and the above post reveals your true nature.
Edited by Strindberg, 30 Aug 2015, 04:25 PM.
Housing costs to Income broadly unchanged since 1994 - re-ratified here
The People of Australia have the highest median wealth in the World
2002-2012 10 year house price growth the SLOWEST since 1952-1962
"There are two kinds of people in this world: ones that fiddle around wondering whether a thing's right or wrong and guys like us." (Hugo to Gagin in Ride the Pink Horse)
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Jimbo
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Strindberg
30 Aug 2015, 04:17 PM
You gave us the reasons just one month ago why you sold your property.
Yes, that is why I sold my property.

I took a punt and it paid off.

But I wouldn't advise anyone else to gamble their home on a speculative trade.

Especially if they have to ask a forum for advice.

Strindberg
30 Aug 2015, 04:17 PM
The contradiction between your post #3 (in which you effectively say price rises AND price falls are irrelevant for a PPOR) and the above post reveals your true nature.
To the majority of homeowners, price rises and falls are a zero sum game.

Your house value will track the houses around you. If yours goes up or down, so does everybody elses.

A PPOR only becomes a speculative asset if you did what I did.

But if you are just wanting somewhere to live, a PPOR is simply a utility.
Edited by Jimbo, 30 Aug 2015, 04:31 PM.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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Rastus2
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Chrisso
29 Aug 2015, 04:10 PM
Hey guys,
This is my first time posting here and am hoping for some sound real estate advice.

Here is my situation; later this year (fingers crossed it comes in the next quarter) I SHOULD be receiving a fairly large sum of money as compensation for a very serious accident that I had. With this money I plan to buy a house for myself to live in.

I am single but have two sons that live with my ex-wife so I was hoping to get a 3 bedroom house that is within driving distance to schools in yokine.

I have bought a house before and last time made the mistake of becoming too emotionally attached to the house and probably missed out on a better deal than I should have got. Subsequently I lost the house.

I have been looking on domain and reiwa for houses available in Scarborough as I love the coastal area plus its proximity to the city. Plus have always been told to look for coastal or city for best investment potential. I have not yet decided on a firm budget but am looking in the vicinity of $6-800,000 (my boys really want a 2 story place. With Internet. And an Xbox. Haha)

My main questions are:
- Are there any specific features (locationwise/housewise that I should be on the look out for?

- Are there any traps to look out for when buying a house of this nature?

- Given the buyers market, is a more expensive house more likely to provide better returns in the future?

- Are there any alternative suburbs to Scarborough that would provide the same lifestyle but maybe a slightly better investment? Even though I do love scarborough :)

- Given that I will be paying cash for the house, is that going to make much of a difference to my buying power? And how much lower than any asking price would you recommend offering?

- Should I look for a private sale? If so where is the best place to look for them?

- Do you have any other advice for me?

Basically I have not been in this position before and due to the volatility of the market and the financial future of WA (insert toilet bowl emoji here 🚽🚽🚽) and the fact that I am basically getting a once off leg-up because life is now going to be much harder I must say I'm VERY nervous and am seeking as much advice as possible.

If anyone is able to offer me any advice I would hugely appreciate it.

Thanks in advance
Chris

Some pretty good advice already, if conflicitng ..

Cash is king, if you have enough of a payout to buy the house outright your already ahead of most buyers right now... leverage that to your advantage..

Not sure of your age, or future intentions ... naturally if you plan to have more kids with another partner down the track, then larger house makes sense... if you are 99% confident you won't want that (or end up with that through a new relationship already having kids), then go with 3 bedroom. Boys sound young... get them the x-box and keep your options open on a 1 story.

Emotions have a lot to do with buying a house to live in.. as someone said, plan for the next 10,20,30 years and vision yourself and how you plan to (realistically) live in any house you inspect... double story is fine but it depends on your physical situation going forward... no point having a big house you can't get upstairs to use.

Considerations I would take into account :

Flooding - you can get flood maps online, but simply driving around an area tells you a bit also... Living in Qld I am more atune to floods than some other people...

Google Maps - use it a lot... learn how to use the terrain feature also (google earth if you need to)... we used it to judge prevailing winds and views on a couple of properties we bought that had lots of vegetation.

Spend some money on a good Pest and Termite inspection... I am not a fan of one person (or company) doing both... make sure they understand you want them in the ceiling cavity no matter what... we bought a place and the termite/pest guy simply wrote 'could not easily access ceiling cavity' on the report hidden in the middle... I made him come back and go back into the space where he found major termite damage which had been repaired... the money you spend on quality insepctions will either save you from a disaster, or give you the ability to force the vendor to pay for repairs instead of you. I can not stress this enough.

Learn how to check your local area for any plans of changes that may impact the property's desirability - I use this website to let me know of any plans that affect the areas I am looking at - any time a planning application hits the council, I get an email.

https://www.planningalerts.org.au (just type in the street address of the property your interested in, read the information, and get alerts).

Get your ducks lined up ... like I said, Cash is king... get some quotes for a conveyancer and ensure you have a couple of Pest and Building inspector's phone numbers ready to go...also make it known to the Agent(s) you are a cash buyer and are looking for vendors who are keen to find one of those (alread 'conditioned' vendors)... often they are sellers who have asked far too much for their property, it has sat for sale for ages, and they have finally come to understand the market will simply not 'meet them', they must move... they now want a sale more than they want premium price and are happy with an offer well below their original expectations. Basically be prepared to sign a contract with minimal conditions... ensure you don't go unconditional however.

Only consider an auction if you have the emotional ability to keep your hand down - the whole result of an auction is often to leverage the emotions to ensure buyers bid more than they intended to and sellers sell for less than they had hoped... sales are unconditional so make sure you have bulding and pest inspection done on any property you are interested in bidding on an auciton property, you should really do your homework first.. the cost of those inspections etc means you then feel pressured to buy as the money has been spent getting to that point... don't let that pressure cause you to over spend. Basically, I have never bought at auction... I am considering it for an IP but for PPOR, I am happier to let the heat of the auction cool and then, if the property is still for sale, walk in with an offer at a later date. If the auction had no real interest, the vendors have spent the money and are looking to just sell the damn property as the potential buyers have now shown their opinion of the value and are likely looking elsewhere.

As you can gather, I'm not a huge fan of auctions... great for vendors in a sellers market with the right property in the right location, great for a buyer in a genuine buyers market (but only if 1 other person does not see real potential in the property and strongly bid against you). If you really must bid at an auction (perhaps the perfect house has come up and your confident others will not bid you up).. take a friend who can actually stop you at your pre-defined limit... if you don't have the kind of friend, don't go.

Don't let 1 agent be your only friend... Agents will split commission, but given the same price, would rather sell the property to a buyer they introducted the property to than a buyer another agent did... I always only deal with the agent who has the property listed under them.. that way, their motivation to get the buyer and seller together is equal for for me and another buyer they might have interested.

Don't let yourself get pressured into making a written offer too early... if you like the property, don't lie, tell the agent ... but tell them you have others to inspect also that you are interested in.. Explain you would rather deal with the agent who has the property listed as you've already discussed the property with them.

No one property is perfect... list your needs, then your wants, rank them, and then score them as each property comes up...

The whole process can be fun... spend time on google reading advice from cool websites... spend time exploring Realestate.com.au/Domain etc.. and mostly, spend time driving around... go to local coffee shops, be realistic about where you can afford to buy and where you would like to pretend you can live.. we always drove around the suburbs we wanted to buy for a while before we bought... our current place was on the market for ~900k 6 months before we knew about it... made it's way through 6 agents and down to 650k by the time we got to it, then we simply phoned the handwritten sign on the fence (next to the 2 REA signs) and delt with the vendors directly... saved them commission, agreed on ~ 600k, and cruised into our new property. Moral of the story is, properties which are on the market for ages have already had much of the dispointment handed to the vendors... if the pest and building inspections are good, + no plans for changes in the street/suburb that impact you, go for it.


Good luck Chris.
Shadow - Defrauded his Bank ? 2015 I have 9 different loans and my bank had no idea which ones were personal and which were investment. They had half of them classed incorrectly. When this change came in they asked me to tell them if any personal loans were incorrectly classed as investment, which I did, and they switched them to personal for the lower rate. They also had a couple of investment loans incorrectly classed as personal. They didn't ask me about those. So they stay on the lower rate too. Worked out pretty well. :)
Shadow - 2008 Sydney Median House Price 1.25M by 2014-2015

Shadow : I think this boom has already begun in several cities. My prediction :
Peak of boom: 2014-2015. Sydney Median Price: $1,250,000 Bottom of bust: 2017-2018. Sydney Median Price: $1,100,000

Shadow's Original 2010 House Boom and Crash prediction http://s836.photobucket.com/user/rastus22/media/shady-orig-2010-chart.png.html?sort=3&o=0

Shadow's attempt to edit his 2010 chart in 2015 and replace it with one that does not show a crash in 2013 http://s836.photobucket.com/user/rastus22/media/Screen%20Shot%202015-06-06%20at%207.12.52%20pm_1.png.html
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Dr Watson
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Jimbo
30 Aug 2015, 04:26 PM
A PPOR only becomes a speculative asset if you did what I did.
So do as I say, not as I do then? Oh, Jimbo!
The trouble with the world is that the stupid are cocksure and the intelligent are full of doubt — Bertrand Russell
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Foxy
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Zero is coming...

Jimbo
30 Aug 2015, 08:16 AM
Buying a house to live in is not an investment decision.

It is the same as buying a car.

If you need a house, buy a house that you can afford and make sure that it suits your needs.

If it goes up by 100% in two years, so will every other house that suits you.

If it goes down by 50% in the next six months, likewise.

PPOR price rises and falls are a zero sum game.

You are buying a house to live in which is what houses are supposed to be for,

Best of luck.
Now that is the truth.

Get a person in your family that is very good with money to advise you.

Good luck.

Peter
http://www.afr.com/content/dam/images/g/n/2/1/u/8/image.imgtype.afrArticleInline.620x0.png/1456285515560.png
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Jimbo
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Dr Watson
30 Aug 2015, 06:45 PM
So do as I say, not as I do then? Oh, Jimbo!
I am not giving investment advice. If I were, I would advise that now is not the time to buy.

Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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