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Episode 116 | Q&A – How does Guarantor Loan actually works, Fixing a Joint Venture, Investing in WA and more

It’s Question and Answer time!  Now, we answered a few questions in the last episode but realised that we wouldn’t be able to respond to all of your questions at this rate, so we will be doing a Facebook Live very soon. Stay tuned for that!

On another note, there’s an exciting announcement at the end of this episode so make sure you stick around. And here are the questions that we would be answering today:

 

  • Question on Guarantor Loan from Kate:

My partner and I earn a combined gross income of roughly $130,000 annually. We have a small amount of savings – about $5000 (remember we’re getting married). But really nowhere near the amount needed for a deposit on our first home. Listening to your episode about guarantors got me thinking. Is it possible to borrow the full amount for an invest-grade property in Newcastle? Do banks really loan 105% with interest only repayments so that we can continue putting money into an offset account? Or are we better to wait and rent and continue saving?

My parents have been lucky enough to own a home in Sydney that has enjoyed the crazy house price growth. Their home would be worth at least $1.5 million at the moment. How long would my parents need to be guarantors – would it be until we had saved 20% of the loan? Perhaps in our offset account? Or would it be until the full amount was paid down?

My dad is from the generation of debt is bad and avoids risks. If you thought this was a smart move, do you have any tips on how to explain the risk/benefits so that he can understand?

 

  • Question on “To Hold or Sell” from Warren: Hi ‘couchers’, thank you for your entertaining, informative, and thought-provoking podcasts. I’d like to know what your thoughts are on rescuing a situation where someone has an investment property they’ve had for 10 years that isn’t performing. Cut the losses and look to replace it, or hang onto it? (I bought this place at age 20 on apprentice wages, it was all I could afford) Thanks! (specifics: paid $195k, current market value $240k, current rent $270/wk)

 

  • Question on Property Investing in WA from Daniel:

My partner and I recently bought a duplex (2 bedrooms, 1 bathroom, 2 living rooms, 475 m2) in Spearwood for $400,000. We have $112,000 equity in the property and $73,000 cash in our offset. Our salaries are $50,000 p/a for my partner and $71,000 p/a for myself, and we do not plan to have children for another 5 years. There is an opportunity to buy the second duplex (also a 2 bedroom, 1 bathroom, with a small granny flat at the back) for $385,000. The site is zoned R40 on 950 m2 (we see a 4 property potential), 3 km from the new Port Coogee Marina, the North Coogee development estate and the potential South Fremantle Power Station development bringing 6,000 new high-density houses/apartments into the area. We are 300 m from the local shopping centre and 5 km from the satellite employment hub of Fremantle (Bryce’s old hood). It ticks all the lifestyle boxes bar being near a train station (it is currently challenging to access the freeway to the Perth CBD). My two part question is:

  1. I am currently weighing up the opportunity cost. What is your inference of Spearwood as a potential “wave rider” suburb piggy backing off the growth of the coastal development? Do you feel that it would have long-term, consistent capital growth or a short term upswing, followed by a flattening capital growth and thus be better to buy into a blue chip area?
  2. As a first time investor, would it be wise to buy the adjacent duplex and land bank the asset, then develop the land after we have acquired several more properties in our portfolio or focus on the subdivision straight off the bat?

 

  • Question on Joint Venture from Tristan:o

I am in a bit of a bind and require some help. I currently have 4 properties. PPOR, a house in country VIC (Nathalia) that my father rents, a house in Frankston (that’s had 10% growth in 5 months!) and the front house on a sub dived block in Seaford.

The last 2 properties were purchased with friends as tenants in common.

I wanted to try and get another property with just my wife and so (as my friend has changed his plans a bit) I spoke to a well-regarded mortgage broker and they told me that the banks have changed the rules and that now they take the full loan amounts of the split properties and only half the rent!?

This destroys my serviceability. I am now not sure what to do, my friend is moving interstate and will not be ready to buy again for 2 years. (which I think my turn into 5 years) and I am keen to keep purchasing.

Should I concentrate on paying down the debt on my PPOR (280k worth 750k) or look at selling one of the joint houses (to gain the serviceability)?

 

And here are Free Resources mentioned in today’s podcast:

 

 

If you like this Q&A episode (How does Guarantor Loan actually works, Fixing a Joint Venture, Investing in WA and more), don’t forget to rate us on our iTunes channel (The Property Couch Podcast) and our Facebook page. Any questions or ideas? Feel free to drop us your thoughts here: http://tpcaustralia.wpengine.com/topics/

Episode 106 | What Is Fractional Property Investment and How Does It Work? – Chat with Anthony Millet, CEO of BRICKX

A few of our listeners have asked us about Fractional Property Investment; what is it and how does it actually works. It is a relatively new investing concept and often, people are confused if it’s investing in shares or property especially when it comes to ownership of the property. So we’ve invited Anthony Millet, CEO of BRICKX, to come on the show and share his expertise! Appointed as the CEO back in April 2016, Anthony comes from an investment banking background, had been the Chief Operating Officer of a leading global online sports retailer and is active investor himself. So for today’s podcast, the three of them will be chatting about:

  • What motivated Anthony into this industry and his investing story
  • What does fractional property investment means and how did it start in Australia
  • Who owns the property in the portfolio and what rights do the investors have
  • How does it work and how much returns would you get
  • What type of assets are included in the portfolio and the asset selection criteria that’s in place
  • The regulatory requirements surrounding this investment product
  • Are gearing or leverage a consideration in fractional property investment
  • Is it possible to trade the ownership of the product and what are the technological platform available for investors to trade in
  • The future of Fintech and property investing in Australia

 

ps: For the roles mentioned in the episode, please check out our Jobs page

 

If you like this podcast: “What Is Fractional Property Investment and How Does It Works? – Chat with Anthony Millet, CEO of BRICKX”, don’t forget to rate us on our iTunes channel (The Property Couch Podcast) and our Facebook page. If you have any questions or ideas, feel free to drop us your thoughts here: http://tpcaustralia.wpengine.com/topics/

Episode 105 | Insights from the Money Queen – Chat with Effie Zahos, Editor of Money Magazine

Our second Live Podcast Recording at the Melbourne Property Buyer Expo last weekend was with Effie Zahos! With more than 20 years in the finance and journalism industry, Effie started as a graduate trainee for Westpac and then moved on to being the head researcher for Channel Nine’s successful Money program in 1997. She has been the editor of Money Magazine since 1999 as well as the magazine’s banking specialist, a regular finance commentator on TV and radio, and the author of The Great $20 Adventure and Getting Rich, Staying Rich!

 

 

So for today’s episode, the three of them will be talking about:

  • How did she start in the finance and journalism industry
  • Being the editor of Money Magazine, working with top economists and industry experts and investors’ success and horror stories she’s come across over the years
  • Having a mentor and how it helps in her career
  • The Top 4 Money Magazine Cover Story and the changes in readers’ interest when it comes to building wealth
  • Building wealth through superannuation and why you should take an interest in it at an earlier age
  • Salary sacrificing and if it’s a good idea
  • The housing affordability debate and what others ways to get onto the property ladder sooner
  • Continuous source of information and education for property investors

 

Here are the resources mentioned in today’s podcast:

  • Money Magazine Cover Story | Earn $2500 a Week at Retirement – Read here
  • Money Magazine Cover Story | Rent and Invest – Read here
  • ABS Website for Population Clock – Find out more

 

If you like this podcast: “Insights from the Money Queen – Chat with Effie Zahos, Editor of Money Magazine”, don’t forget to rate us on our iTunes channel (The Property Couch Podcast) and our Facebook page. If you have any questions or ideas, feel free to drop us your thoughts here: http://tpcaustralia.wpengine.com/topics/

The Property Couch Christmas Pack

 

Hi all! As promised, here’s The Property Couch Christmas Pack for 2016! Just leave your details above and we’ll send it to you right away.

You should be expecting lots of goodies in this pack such as:

  • Case Study for Single 30-something Investor (How to Build a Property Portfolio to Retire on $2,000 a week in Passive Income)
  • Fact Sheet on Guarantor Loan
  • Presentation Slides (7 Ways to Get Kids on the Property Ladder Sooner)
  • Link to the Population Growth Estimate

And whilst you’re here, check out our New Website… hint, check out the “About Us” page, it is a pretty cool look at how far we’ve come.

Merry Christmas and have a happy and safe New Year!    😎

 

Bryce, Ben and The (TPC) Stig

 

 

 

 

 

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