Only a couple more weeks left to our Summer Series. This week, Bryce Holdaway and Ben Kingsley will be answering the questions below from our fellow listeners. Thanks again for submitting your questions!

• Credit card management question from Peter on Facebook: Loved reading the book. Quick question, in your Money Smarts section (Chapter 3 of the book) you discuss using your credit card for fixed expenditure. Does that include groceries…assuming groceries doesn’t come under lifestyle? That seems to provide a variable – do you think that is still best? I want to adopt your setup but worry about using a credit card, considering we don’t have one currently. Thoughts?

• Professional Fees questions from Andrew : Hey guys, thanks for all the valuable information so far. I have a question in regard to the fees and cost of the property portfolio and buyers agent services. I am a first time investor with limited funds for my purchase, and I am trying to get an idea whether or not I could
  • a) even afford the above services and
  • b) whether those funds would be better spent contributing to a larger deposit? Can buyers with smaller budgets (sub $400k) still maximise capital growth and rental yield using qualified property advisers and investment savvy buyers agents? Cheers.

• Question on line of credit from Christian: Hi Ben, what are your thoughts on using equity and/or a line of credit to fund the negative cash flow on high growth properties?
  I know that some other high profile companies are advocates of this strategy. Your thoughts? Would love to hear your thoughts in podcast.

• Value add question from Heath: Hi guys, love the show and I am currently up to the Buyer’s decision quadrant in the book and really enjoying it. My question to you is:
  I have a recently renovated investment property in Brisbane that is a 3x2x2. We have built in a 4th bedroom downstairs in the existing utility room (legal height, ventilation, windows and power supply etc.) Currently I am speaking to a few building certifiers and engineers etc. to assess whether or not I can get the 4th bedroom certified through council. It’s looking like the certification will cost me around 5k and the difference between the median for 3 & 4 bedrooms in the area is around 60K. Would you think moving forward with this would be feasible? And if so when issued the certificate through the Brisbane council is this something that I would submit to the valuator when they would be doing the inspection?

• Repayment question from Joe: I actually just finished reading your book about 30 min ago and I have to say I really enjoyed it. In particular chapter 9 and 10 (investment strategies and the case studies). I found it very easy to follow and understand though I do admit I learn a lot of the terms and phrases from the podcasts. I do have a couple of questions though.
  • I noticed that in the case studies the loans were always interest only which is fine and I understand why it’s like that, but is it possible to have Interest only repayments over the course of the entire loan? Surely at some point the bank wants principal paid back.
  • This leads me to my second question, during your case studies do you factor in the fees of your service as this would have a noticeable  impact on the overall purchasing power of the buyer?

 

If you like this Q&A episode (Credit card management, professional fees, LOC for negative cash flows, adding value via renovation and interest only loans), don’t forget to rate us at 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/