Investment Archives - Lime Property Solutions

Jan 09

0

Is Property investment a better investment than shares?

By MLKtech | best investment, Investment, Properties, rent | No Comments

The beginning of a new year and another perennial article is published in today’s paper asking the age old question “Is property Investment a better investment than shares?”

The answer, of course, is ‘yes’, even when the study methodology makes it as difficult as it possibly can for property to exceed shares!
(Please contact us at info@limepropertysolutions.com.au. for further information or the chance to discuss this and other issues in the comfort of your own home.)
The largest problem in trying to compare growth and return in investment property to the share market is always the methodology used in the study. The article printed in today’s news “Rent or Buy. The evidence is in” (read article here) is at best confusing although the result is perfectly clear – property is the better investment!

The article is not really about investment at all. As the title suggests, it is asking the question “Are you better off renting or better off buying your own home?” Most people would have enough common sense to know that you are actually better off owning your own home (as the study also finds!) but the confusion arises when the comparison is made between investing all the funds you don’t spend on buying your home into the share market thus, in my mind, making the comparison one of investing in property to investing in the share market. This is NOT the case in the methodology scenario described. Why you ask? Because a well set up investment property for someone earning around $100,000 per year would possibly deliver an additional few thousand dollars per year in positive cash flow – it would not be a cost and certainly not a significant cost.

When we examine the idea of ‘rentinvest’ (see earlier blogs for more details) where we continue to rent but also buy a property investment, then the article really makes no sense at all in the real world. We do not think your own owner-occupier home is a real investment – it is just something we must have to live in. The only way to measure share investment against property investment is to compare apples to apples; that is make sure we are comparing an investment property return against a share market return.
However, whichever way we look at it, property investment makes a great deal of sense!

(If you want to know more about property investment that can be cash positive after tax from day one, contact us now at info@limepropertysolutions.com.au.)

Dec 20

0

Turn $15,000 into a staggering $10 million through property investment

By Hugh Frame | best investment, Investment, Properties, Property Research, Property Solutions, Real Estate | No Comments

$15,000 into a staggering $10 million through property investment

Scott and Mina O’Neill, aged 28 and 29, own 25 properties worth more than $10 million across the country
The married couple purchased their first home together in 2010 in Sutherland, south of Sydney
They have built their property portfolio by rentvesting, renting their own home and investing in others

A young couple in Sydney’s south have turned $15,000 into a staggering $10 million through property investment.

It’s a great Christmas story and one any young couple should be thinking of repeating starting in 2017!

(Please contact us at info@limepropertysolutions.com.au for further information or the chance to discuss this and other issues in the comfort of your own home.)

Scott and Mina’s story can be found here http://dailym.ai/2gNPBDS

It’s a story many other young couples could share and one many have shared, turning a relatively small savings account into a multi-million dollar portfolio. Their story is almost a perfect duplicate of the information to be found in the Lime property Solutions free eBook which you can download free from here: www.limepropertysolutions.com.au

To turn $15,000 into a staggering $10 million through property investment, the O’Neill’s have used the strategies Lime teaches and recommends, particularly with understanding markets and market timing. They have, in a relatively short period of time, built a portfolio of 25 investment properties while they continued to rent their own home. Lime Property Solutions can explain a few things to clients which would make their portfolio even less risky and almost certainly better performing than what the O’Neill’s advocate. For example, a better understanding of yield and return can make a portfolio much better performing over a relatively short time-span.

If you want to know more about how you can build a multi-million dollar portfolio through property investment, write to: info@limepropertysolutions.com.au.

This couple manage to make their millions through rentvesting.

Rentvesting refers to purchasing an investment property but continue renting. You could turn $15,000 into a staggering $10 million through property investment!

Dec 05

0

Stamp Duty Must be Reduced

By admin | best investment, Economy, Financial, Investment, Negative Gearing, News, Property Solutions, stamp duty | No Comments

Stamp duty must be reduced

NSW Planning Minister Rob Stokes has recently broken ranks with his Liberal colleagues and suggested that the federal government should make changes to negative gearing. It’s all part of the Sydney ‘affordability’ debate but it is a reduction in stamp duty which is a much better way to improve affordability. Most studies into negative fearing show that its removal is unlikely to drop property prices by any more than half of one percent, yes just 0.5%.

(Please contact us at info@limepropertysolutions.com.au for further information or the chance to discuss this and other issues in the comfort of your own home.

On a very low-priced Sydney home at $550,000, the stamp duty payable to the State Government is over $20,000. Ion the same property, it would likely reduce in value by just $2,750 if negative gearing incentives were removed.

Mr Stokes argued that adding new supply to the market would not make property affordable on its own and suggested changing tax benefits for investors should be changed. In our view, it’s a pity Mr Stokes could not do the arithmetic in the last paragraph and then realise that he and his party can actually do something now to assist affordability rather than doing the political usual of putting it in the ‘too hard’ basket then passing the problem off to someone else. Read more : http://www.domain.com.au/news/stamp-duty-adding-years-to-the-depositsaving-plans-of-sydneys-home-buyers-20161202-gt2jjz/

Property Council of Australia chief of policy and housing Glenn Byres says the $40,000 an average home buyer in Sydney pays on top of their purchase price in stamp duty is a concern. In just four short years, the NSW Government’s stamp duty revenue has doubled from $4 billion to $8 billion. Stamp duty must be reduced if we are to help first home buyers.

If you want to know more about how you can save on stamp duty buying a new property investment contact: info@limepropertysolutions.com.au

Nov 21

0

What should you be looking for in a new investment property?

By Hugh Frame | best investment, Investment, Properties, Property Research, Real Estate, rent, Research | No Comments

What should you be looking for in your new investment property?

It makes sense to understand changing demographics because what you buy today as a ‘good’ investment property may not be so good in 10 or 20 years when you decide it’s time to sell, so what should you be looking for in a new investment property?

An investment property that works today may not be as desirable as a home for our population of tomorrow so it’s important to keep track of changing demographics and buy an investment that is most likely to appeal to tomorrow’s owner occupier market.

Just a couple of decades ago, the average Australian household had around five people living in it. Just five or six years ago, the average home had just over 3 persons per household. This has increased slightly as more and more older children decide to stay at home for much longer. The big family for most Australians is a thing of the past, in the 2012 census it was stated that most households within a small radius of the centre of most of our cities had less than two persons per household!

The growing demographics of home owners and renters, the growth group for new households comes from:

Young professionals
Young couples
Empty nesters
Retirees
Single parent families

It would seem that with older children staying at home longer, as well as the above growth demographics, it’s important to consider their needs for a good investment property.

(Please contact us at info@limepropertysolutions.com.au for further information or the chance to discuss this and other issues in the comfort of your own home.

There is a move towards the city centre with these groups and the need for well-designed units and townhouses with a bathroom each is becoming an essential for shared living, whither with a relative or a friend. Good-sized bedrooms are also an essential with room to entertain.

Nearly 60 per cent of those aged 15-29 are still living with their parents across the 35 wealthy member nations of the Organisation for Economic Cooperation and Development. In Italy, Slovenia and Greece more than three quarters of that age cohort have not yet flown the coop. Australia’s proportion has reached 54 per cent. Read more https://goo.gl/B3U0kW

This is a trend that is unlikely to change for some years, particularly as house and unit prices continue to rise. Make sure you buy an investment property that will work for you in the future, do the research now before you buy. So what should you be looking for in a new investment property? Consider the future demographics that may eventually want to purchase your investment property.

(Please contact us at info@limepropertysolutions.com.au for further information and the chance to discuss this and other selection criteria issues in the comfort of your own home.

Nov 15

0

Is a unit a better investment than house and land?

By Hugh Frame | best investment, Investment, Properties, Property Research | No Comments

Is a unit a better investment than house and land?

Is a unit a better investment than house and land, one of the most common questions we are asked by property investors? It’s amazing the number of Real estate homilies that are so completely inaccurate yet so many people are prepared to believe them.

(Please contact us at info@limepropertysolutions.com.au for further information or the chance to discuss this and other issues in the comfort of your own home.Location will make the difference

Location will make the difference, not building type

One of the common ones is that we should only buy house and land, the old saying being that “land appreciates but buildings depreciate”. I wonder how you would get on trying to convince Hollywood star Russell Crowe of this this one. Russell has opened the doors of his Finger Wharf apartment in Woolloomooloo to select off-market buyers ahead of an official listing early next year.

His price expectations on the landmark harbour front apartment are $30 million, which would break the current national apartment record of $25 million…… And the land content of this apartment is exactly zero as it is built on a wharf above water. The original selling price when bought off the plan in 1998 was $9.8 million. Crowe made the purchase in 2003 setting a Sydney record of $14.35 million. Current neighbours include billionaire Lang Walker and broadcaster John Laws.

Will Donald Trump burst the Australian housing bubble?

By Hugh Frame | best investment, Economy, Investment, Market, News, Property Research, Research | No Comments

Will Donald Trump burst the Australian housing bubble?

Speculation is rife on everything financial, with Donald Trump at the wheel of the world’s largest economy; the biggest of these questions for the property investor is will Donald Trump burst the Australian housing bubble? Read more: http://www.smh.com.au/business/the-economy/is-donald-trump-going-to-burst-australias-housing-bubble-20161111-gsnee0

Will Donald Trump affect Australian property prices?

It was written at the weekend, “given his propensity for lying, exaggerating and generally raving, nobody can know what Donald Trump will actually do as president. He probably doesn’t know himself.” The article does not confess to general raving and exaggerating itself in that there is absolutely no evidence of an Australian housing bubble! Australia is the largest island nation in the world, it includes WA and FNQ, Tasmania, SA and everything between. There is a possibility of a ‘housing bubble’ in our two largest cities, but in many other places, prices are less than what they were 10 years ago. This is in Australia and we can’t talk about an Australian bubble, that’s Donald Trump talk!

(Please contact us at info@limepropertysolutions.com.au for further information or the chance to discuss this and other issues in the comfort of your own home.

According to the bond market reaction, Trump may burst the Sydney/Melbourne housing bubble by causing interest rates to rise.

The Trump plan, in its essence, is very simple and markets clearly believe it will work. He is planning a major infrastructure investment and, unlike Australia, he won’t let public servants constantly get in the way of the infrastructure momentum. But he will re-fire the American steel furnaces, because he doesn’t plan to use Chinese steel.

Trump also plans to lower the US tax rate and suck the enormous sums that American corporations are holding overseas back into the US. Along the way he will make it harder for Canadian, Mexican and Chinese exporters to tap the US market. He says that will be done via higher tariffs. The world is going to move from an increasingly globalised one to one where nations will look more inwards. But given today’s communication and transport systems there is a limit to this change.

The more common fear is that he could start a trade war with China that would cause a global recession which would obviously affect Australia. That would not be a good way to achieve lower housing prices. Hopefully there is enough sanity left in Congress to prevent such madness and just consider the more benign interest rate story.

The last Reserve Bank board meeting was forecasting another RBA rate cut or two by the middle of next year. Trump’s policies, if implemented, will cause a period of inflation resulting in RBA increases and that could certainly cool down the Australian housing market.

So will Donald Trump burst the Australian housing bubble? The media are always looking for stories which may deliver this result, time will tell but maybe they are on to something here that will see prices stabilise in Melbourne and Sydney.

If you want to know more about possible ‘property bubble bursts” or discuss buying new property investment, contact: info@limepropertysolutions.com.au.

Nov 07

0

Buying your first home is not easy, Bernard Salt

By Hugh Frame | best investment, Economy, Investment, News, property cycle, Real Estate | No Comments

Buying your first home is not easy, Bernard Salt

Buying your first home is not easy, Bernard Salt, some of our younger generations, Gen X and Gen Y, seem to miss the humour of one of our best known demographers, Bernard Salt, who has now written two articles over the last couple of weeks suggesting firstly, that they might like to stop buying expensive avocado lunches and save for a home or even give up their overseas holidays and save instead for a house deposit! Like me, Bernard is a “baby-boomer”, one of the lucky who just drifted through life buying cheap properties and having a ball!

(Please contact us at info@limepropertysolutions.com.au for further information or the chance to discuss this and other issues in the comfort of your own home)

While his recent articles should not be taken too seriously, or rather too literally, I do feel some annoyance at how hard the world is perceived to be to some of the younger generations trying to jump on the first step of the property ladder. It has never been an easy step to take, Buying your first home is not easy, and it can be annoying when we baby-boomers are reminded just how easy it was for us to get started.

Read more Bernard Salt article here: https://goo.gl/wGnqiK

My first home was bought in the UK. I was a 21 year-old teacher and the very small two-bedroom duplex I purchased was around eight times my annual income. I managed the deposit through working for the previous four years, sometimes up to 126 hours per week during all the long university breaks and saving by staying at home. On a couple of occasions, I did take lower paying jobs which offered me free accommodation and free meals in holiday destinations like France and the Channel Islands. While I didn’t save much on these jobs, I at least had the opportunity to explore and enjoy a different culture. Travel expenses were absolutely minimal as I hitch-hiked most of the time.

When I eventually moved in to my first home, I had most of the basics from presents from a large family. I had a bed, lounge suit and necessary kitchen-ware and linen. I made most of the ‘furniture’ from cheap melamine sheets and watched a black and white television gifted to me as most people were switching to colour. I did have an old car that was serviced by me with the help of a friend. I had to take on another evening part-time job to help make ends meet. The only time I could ever afford to eat-out was at family gatherings where usually, my parents were paying. Every couple of weeks, if the budget allowed, we may have had a bottle of wine. Eight years after buying the house, I had my first 10 day trip overseas.

This was a lifestyle very typical to all my friends, it did not seem ‘hard’ and it certainly was not unusual. The older generation thought, quite rightly, that we never had it so good.

In speaking to older Australians, including many European immigrants from the 50’s and 60’s, it seems their life was similar. Many tell stories of building their own first home with the help of friends and sleeping on mats on the floor until they could afford a proper bed.

I’m very glad the world has changed and our standard of living has improved immensely since the 1970’s but I do think Mr Salt, tongue in cheek or not, is putting out a very important message; it is not easy to get on to the property ladder buy it never has been! It does often take some sacrifice in current lifestyle and it does involve living on a tight budget …. and always has!

‘Affordability’ is always an issue after a period of cyclic growth. Buying your first home is not easy and never has been. The same stories emerge after every growth cycle. We had the same discussions in Sydney in 1989 and again in 2003 after the last two major growth cycles. After a few years, income increases, borrowing rates change and things become easier – affordability increases! If we make the necessary sacrifices and budget/lifestyle changes now, then there may be a good chance that advantage can be taken during the next phase of more-affordable housing. It will happen, it always does, just be ready for it and don’t expect to start off with everything that your older neighbours have; it’s taken them all their life to get to where they are!

If you want to know more about this or discuss buying new property investment, a great way to ‘save’ towards your own first home, contact: info@limepropertysolutions.com.au.

Nov 02

0

Banks are destroying your land titles

By Hugh Frame | banking, best investment, Financial, Investment, Mortgage, News, Research | No Comments

Banks are destroying your land titles

Last week we had a couple of days hold up with a refinance matter with one of our clients; the reason was that the banks are destroying your land titles and there may be some hicups in going digital!

It is reported today in the business section of the Sydney Morning Herald –

Affordable Housing fix is years away

By Hugh Frame | best investment, Economy, Investment, News, Properties, Property Research, Real Estate, stamp duty | No Comments

Affordable Housing fix is years away

Don’t you get fed up reading about the latest ideas on affordable housing? Now we read again something we all know, the affordable housing fix is years away!

The latest government inquiry, costing thousands of dollars again has been abandoned and placed in the ‘too hard’ basket yet again, good and not surprising news to the property investor but not so good news for the first home buyers in our major capital cities.

(Please contact us at info@limepropertysolutions.com.au for further information or the chance to discuss this and other issues in the comfort of your own home)

It’s reported today, “Treasurer Scott Morrison’s speech on housing affordability might look like an improvement on his predecessor’s “get a job, a job that pays well” advice. It’s not. In practical terms, it’s nothing at all.”

It’s reported as one of the government’s favourite sort of problem, “one they can flick responsibility for onto the states and spend some years “thinking” about it without actually doing anything constructive.”

So the problem is all about supply, or is it state land use regulations, or is it tax policy and something to do with the cost of supplying expensive social housing? Maybe it’s all about changing our capital gains tax rules or getting rid of negative gearing or just moderating the rules on new land releases? It might also help to charge developers more for appropriate infrastructure around new releases or developments, (struggling to understand this one?) or just a simple case of easing the huge amounts of stamp duty payable on the purchase of a property?

Of course, the answer may just be reviewing the first home owners grants, introduced in 2000 to assist with the additional costs in building caused by the introduction of the GST or maybe it’s just about lowering interest rates even further and keeping them low?

Now you know what some of the issues are you should have some idea of how easy this is to rectify! For a fuller explanation, you might like to try and understand this article: https://goo.gl/pE6vAR

I really think it is fair comment to assume that property investors have little to fear in the future about what government can or will do to make owning a property more affordable. The one thing that is very true and understandable about the issue is that affordable Housing fix is years away, if ever.

If you want to know more about how to make money out of the ever increasing price of property, contact us at info@limepropertysolutions.com.au.

Oct 24

0

Empty bedrooms? Put your money where your mouth is!

By Hugh Frame | best investment, Economy, Financial, Investment, News, Property Research, Real Estate, Research | No Comments

Empty bedrooms? Put your money where your mouth is!

Apparently Sydney now has 20 years of future housing stock in empty bedrooms? Put your money where your mouth is NSW if you want to utilize more of this ‘space”.

Downsizing is too costly for many older Australians

The first point of this new argument must be defining who has these ‘extra bedrooms”? While some bedrooms in the homes of empty nesters may be empty some nights of the week, many do not have empty bedrooms gathering dust. After years of being cramped with children, it’s a later life treat to own enough space for a study or an area to pursue a hobby. These rooms can also be used as exercise rooms to keep ageing bodies trim. Most are also grandparents who require bedrooms for visiting children and grandchildren; they are perhaps underused but certainly not empty.

(Please contact us at info@limepropertysolutions.com.au for further information or the chance to discuss this and other issues in the comfort of your own home)

It’s also time to review the massive disincentives placed on older Australians to downsize. Many empty nesters will never consider downsizing because the appropriate type of housing is just not being built. Sure, we are constantly being warned about the forthcoming glut of apartments in most of our east-coast city markets, but many older Australians are not prepared to give up their gardens or a small private area where they can allow their ‘fur-children’ some space to run around outside the home. A smaller garden is often an attractive proposition but no garden at all is a deal-breaker. We need more villas and town homes in the established suburbs where the majority of these older Australians currently live.

The financial penalties for retirees downsizing can be enormous. Just imagine, an older retired couple in a slightly above average (larger) home worth $1.5 million. The home sale, including marketing and legal costs will cost them around $30,000. They buy a smaller town house at around $900,000 and they say goodbye to another $40,000 in stamp duty, another $2000 on legal fees and probably around $10,000 in removal expenses and buying some new furniture that ‘fits” their new surroundings. Basically, they would need to budget around $100,000 of their, (in most cases) diminishing wealth just to move.

Having made the move, they find that they have an additional $400,000 in the bank. This may be enough to stop many of their senior benefits, including pension payments. The argument, of course, is that they don’t need any government funding now but this misses the point that older Australians do love their children and grandchildren and they see it as an essential legacy to leave an inheritance to their family.

It will always be difficult to persuade older people to move out of their family home to free up empty bedrooms for the younger generations but as long as our governments insist on penalising such a move, the bedrooms will stay “empty”. Read more https://goo.gl/jBePqx

If you want to know more about appropriate house type investment contact us at info@limepropertysolutions.com.au.

Investment

Is Property investment a better investment than shares?

Turn $15,000 into a staggering $10 million through property investment

Stamp Duty Must be Reduced

What should you be looking for in a new investment property?

Is a unit a better investment than house and land?

Will Donald Trump burst the Australian housing bubble?

Buying your first home is not easy, Bernard Salt

Banks are destroying your land titles

Affordable Housing fix is years away

Empty bedrooms? Put your money where your mouth is!

Recent Posts

Archives

Categories

Meta

About Us

Contact Us

Sitemap

Follow Us