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Why every millennial should be a ‘rentvestor'
Topic Started: 19 Apr 2016, 08:39 AM (5,610 Views)
Rufus
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Chris
19 Apr 2016, 08:14 PM
If the government decided it to change CGT concessions and almost beg everyone to begin buying IP in the late 90's how different would the market be. If they didn't allow banks to regulate themselves and go on to have such poor lending standards that a f***ing Royal Comission is a necessity, how different could the market be? If that combination of tax subsidies and cheap easy credit didn't create massive speculation in what is a basic human right in what is an advanced economy. If organised crime wasn't allowed to permeate the entire building industry where they control everything, dictating enormous wages, exorbonate material costs with their 'friends' associated trades and extorting, I mean stopping work and demanding more money for workers mid build, how different would the market be?


In your little bubble you fail to see past mistakes and your generation is doomed to repeat the same mistakes over and over. If all this didn't drive up the cost of building then the burden on the government in relation to social housing would be significantly less, in fact it is quite conceivable that we may not even have a social housing problem.


Nope, why should I be?

You're the one that should be embarrassed but as a sociopath I'm sure that is difficult. You understand that by playing the lesser card, by that I mean belittling me in an attempt to make me the lesser (you the greater), you come across as a twisted sociopath.

You do know this right, most people would read your posts and feel sorry for you Pete not me.
OK so you should be embarrassed, but your not.
Take risks - if you win you will become wealthy, if you lose you will become wise
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kodiak
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Trollie
19 Apr 2016, 03:44 PM
Honestly, for young people the best move is to buy shares.

Shares earn at a higher rate historically and starting young means any dips in the market can be recovered from, it's a liquid investment you can exit out of when you are ready for a IP. The barrier to entry is very small for shares, you can start with just $500, property requires a great deal more capital and always has done.


Part of my personal strategy has been to buy shares regularly in long standing companies with a track record of high profits, and more recently ETF's. I've done this over the long term and intend on continuing right up to retirement.

Young people often don't have enough life experience to know what to buy either, and given stamp duty it can mean expensive mistakes.
It would be even better to buy shares outside of Australia so that you don't have exposure to the AUD or domestic economy. Australia is fisted. It's amazing how far a place can fall in 20 years.
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Veritas
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Rufus
19 Apr 2016, 08:01 PM
It looks to me as though "your evidence" shows that the state is seriously underperforming in it's duty to provide social housing, so the state is heavily leaning on private landlords to make up the supply required.

Had private landlords not done that then the public investment in providing and maintaining public housing would be absolutely enormous.

Yes, the State is seriously under performing.

Budgets have to be kept in check.

It could address the issue by reducing the amount of free money it gives relatively wealthy people through Negative Gearing and CG exemptions and channel the revenue saved into increasing supply in the social housing system.

You argument that " the private landlords are doing the State's job for it" is specious, self serving nonsense.
Property acquisition as a topic was almost a national obsession. You couldn't even call it speculation as the buyers all presumed the price of property could only go up. That’s why we use the word obsession. Ordinary people were buying properties for their young children who had not even left school assuming they would not be able to afford property of their own when they left college- Klaus Regling on Ireland. Sound familiar?

The evidence of nearly 40 cycles in house prices for 17 OECD economies since 1970 shows that real house prices typically give up about 70 per cent of their rise in the subsequent fall, and that these falls occur slowly.
Morgan Kelly:On the Likely Extent of Falls in Irish House Prices, 2007
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North Stradbroke
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Restvesting works if the entry cost is low enough. I recommend it all the time to Gen Xers that missed the boat or are just crap at life planning. Takes a bit of research these days now that the Central Coast, Hunter and Port Stephens are getting swamped with boomer money. Who would have thought a run down shack in Budgewoi would be worth $400k. Geez. Two bedroom houses in Toukley that sold for $260k three years ago are on the market for $360k today. Anyway, lower income rentvestors today should be looking further out to stable regional towns like Wagga, Dubbo, Tamworth. Find out which areas/streets the healthcare and education professionals like to rent in and buy a family home there for under 300k. You might even have positive cash flow. It's not easy to break away from the Sydney/Coastal religion, but it can be done.
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those
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Rufus
19 Apr 2016, 08:39 AM


2. Purchase as a ‘rentvestor’ (the term is a registered trademark of LJ Hooker). In this instance, first homebuyers purchase an investment property in a more affordable area while continuing to rent in their preferred suburb.
So let's say you rent a house worth $1m and then buy on in a more affordable suburb for $500k.

So is the idea that in 7-8 years time your more affordable investment house has doubled to $1m, and so how much is one you are renting is now worth? $2m?... so now you can sell your investment and afford the preferred house?
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herbie
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Another potentially attractive possibility is to set up a SMSF and use it to buy oneself a property of course.
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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Rastus2
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createdby
19 Apr 2016, 06:15 PM
Trollie was also advising readers to buy in the stock market when it dipped last year for the "generous" dividends.

A month later, RIO and BHP and the big 4 banks announced an end to their progressive dividend policies.

oh no, that can't be right... trollie assured me on this very forum that he had no financial stake in IO or mining ... don't tell me he lied :re:


No wonder he is a bitter little troll... went from fabulous guru to complete failure and had to hide his purchases from his wife I bet.
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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Rufus
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Veritas
19 Apr 2016, 09:55 PM
Yes, the State is seriously under performing.

Budgets have to be kept in check.

It could address the issue by reducing the amount of free money it gives relatively wealthy people through Negative Gearing and CG exemptions and channel the revenue saved into increasing supply in the social housing system.

You argument that " the private landlords are doing the State's job for it" is specious, self serving nonsense.
Federal and state governments went down this road many decades ago and it's too late to change course. If we hadn't gone this way you would now be complaining about how much of your tax dollar was being put towards social housing - not just the infrastructure but the maintenance.

In this model the government simply allows private investors to claim a normal tax deduction early and they boost the income of low income earners by paying them "rental assistance" to allow them to compete for rental property.

Public housing has effectively been privatised and they aren't going back.
those
20 Apr 2016, 01:22 AM
So let's say you rent a house worth $1m and then buy on in a more affordable suburb for $500k.

So is the idea that in 7-8 years time your more affordable investment house has doubled to $1m, and so how much is one you are renting is now worth? $2m?... so now you can sell your investment and afford the preferred house?
Compare that outcome to one where you simply kept renting and didn't purchase a rental property - how would those two outcomes compare?

Personally I think the best situation is where a buyer was still living at home and they buy an investment property with the rental covering most of the outgoings.
Edited by Rufus, 20 Apr 2016, 08:22 AM.
Take risks - if you win you will become wealthy, if you lose you will become wise
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those
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Rufus
20 Apr 2016, 08:17 AM

Compare that outcome to one where you simply kept renting and didn't purchase a rental property - how would those two outcomes compare?
In a sense, the outcome is the same. Neither of those options would get you into your preferred house, which could be the reason not many people choose the 'rentvestor' option as they've described it.

Buying a house of equal value to the one you want, renting it out, and taking advantage of the tax system in that scenario is a different story. But then, there are different reasons not to choose this option. Most people just want to live in a house they own if they have that option.
Edited by those, 20 Apr 2016, 09:30 AM.
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createdby
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Rastus2
20 Apr 2016, 08:14 AM

oh no, that can't be right... trollie assured me on this very forum that he had no financial stake in IO or mining ... don't tell me he lied :re:


No wonder he is a bitter little troll... went from fabulous guru to complete failure and had to hide his purchases from his wife I bet.

Read all about it here:

http://australianpropertyforum.com/single/?p=8575658&t=10355389

The Whole Truth
 
Yield yield yield, it's all about yield. Don't worry if your stocks go to cents on the dollar. All is well.

Trollie
 
ASX 200 on track to payout 81.8 BILLION in dividends, and you are too f***ing stupid to get a piece of the action.


Trollie was shortly after shafted with the long purple spiky thing up his behind:

Rio reassesses dividend policy on loss
https://au.news.yahoo.com/thewest/wa/a/30797054/rio-reassesses-dividend-policy-on-loss/


CBA results: $5bn profit boost but dividend frozen
http://www.theaustralian.com.au/business/financial-services/cba-results-5bn...rofit-boost-but-dividend-frozen/news-story/f17fddfb340f2df82bf0f62437b394dc

Australia and New Zealand Banking Group flags dividend cut
http://www.fool.com.au/2016/01/28/australia-and-new-zealand-banking-group-flags-dividend-cut/


BHP downgrade a dividend red flag
http://www.theaustralian.com.au/business/opinion/bhp-downgrade-a-dividend-red-flag/news-story/5f2e65abc3e5af42c02a503554d4449a
Edited by createdby, 20 Apr 2016, 09:39 AM.
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