Join our investing community

Happy New Financial Year!

Discussion in 'Investing Strategies' started by Nigel Ward, 3rd Jul, 2006.

  1. Nigel Ward

    Nigel Ward Team InvestEd

    Joined:
    10th Jun, 2005
    Posts:
    1,172
    Well another FY gone and a new one just begun...

    So what are your New FY resolutions? :D

    Are they S.M.A.R.T. goals?
     
  2. -T-

    -T- Well-Known Member

    Joined:
    2nd Apr, 2006
    Posts:
    194
    No time for goals yet Nigel. I'm doing year end for: 2 x investors, 3 x trusts and 3 x private companies. Not the lodging itself, but finalising books, year end adjustments, reporting final GST/PAYG, etc.

    My primary NFY resolution is to become financially independent based on current lifestyle minus a few luxuries. So by 30 June 2007, that's the goal.

    How about yourself?

    PS That goal will be S.M.A.R.T once I have some time to update my plan and define it in new detail.
     
  3. hiflo

    hiflo Well-Known Member

    Joined:
    3rd Jun, 2006
    Posts:
    68
    Location:
    Sydney, NSW
    I have been lurking on this forum for a while and absorbing heaps of information.

    Here are my goals this financial year:

    1. Get a job that pays more - change jobs, learn new skills that will make me more valuable.

    2. Get rid of my HECS debt totally and get 10% discount- have learnt that if I am studying that is required on the job, I should pay up front, and not get HECS (but this should depend on individual financial circumstances)

    3. Learn more about finance, investing & tax so that I can be more in control of my money.

    4. Analyse my current investment portfolio and diversify my investment Also think about getting a margin loan for my well performing shares and management funds, thus increasing my overall return on capital in the following years.

    5. Buy an investment proprty if I find a bargain below $300,000.00
     
  4. Qaz

    Qaz Active Member

    Joined:
    16th Aug, 2005
    Posts:
    26
    1. Continue saving $12,000 a year (more if possible)

    2. Keep up my current marks at uni

    3. Get some experience in the field of accounting

    4. Learn more about investing

    5. Build up enough money for starting deposit
     
  5. -T-

    -T- Well-Known Member

    Joined:
    2nd Apr, 2006
    Posts:
    194
    Hey Qaz

    What are you doing at uni, if you don't mind me asking? Is it finance related?
     
  6. Qaz

    Qaz Active Member

    Joined:
    16th Aug, 2005
    Posts:
    26
    Bachelor of Commerce, majoring in Accounting.......
     
  7. -T-

    -T- Well-Known Member

    Joined:
    2nd Apr, 2006
    Posts:
    194
    I see you're in Canberra; ANU, UC?

    I'm doing a Master of Finance at ANU at the moment. Maybe you can do any future accounting for me (since it's your major), it's the only subject I haven't got an HD for so far (got a CR) :p
     
  8. Qaz

    Qaz Active Member

    Joined:
    16th Aug, 2005
    Posts:
    26
    Uni Of Canberra
     
  9. Jacque

    Jacque Team InvestEd

    Joined:
    16th Jun, 2005
    Posts:
    1,885
    Location:
    Sydney
    Where are you hoping to purchase your bargain property, Hiflo?
    Plenty of places to locate something for that price- location is highly dependent, naturally :)
     
  10. hiflo

    hiflo Well-Known Member

    Joined:
    3rd Jun, 2006
    Posts:
    68
    Location:
    Sydney, NSW
    Hi Jacque,

    What I mean by bargain is 10-15% below market price. Not too desperate to buy yet. But have some money to put down as deposit if I come across something.

    Currently going to open houses every week and doing some internet search.
    I am also trying to get some feel for the market in Sydney as I intend purchase the first property in Sydney to take advantage of all first home owners benefits and then turn it into investment property.

    What is most important for me is:

    CAPITAL GROWTH FOR NEXT 10 YEARS as I want to buy & hold and use the equity to grow my portfolio.

    The location must be:

    1. Close to public transport.

    2. Close to good shopping facility.

    Currently interested in:

    1. Lower North Shore (haven't been to any open house yet)
    2. Maroubra/Randwick/Coogee/Clovelly/Bronte/Bondi Junction
    3. Botany/Mascot/Rosbery
    4. Marrickville/Dulwich Hill/St Peters/ Erskinville
    5. Belmore/Campsie
    6. Blacktown

    Jacque, do you think there is anything that I can do? Or are there any other areas that I should put under my radar?
     
  11. Jacque

    Jacque Team InvestEd

    Joined:
    16th Jun, 2005
    Posts:
    1,885
    Location:
    Sydney
    Hi Hiflo
    You need to really narrow down your search and concentrate on a couple of areas/suburbs at a time to know the area, the prices, what's happening in the market and subsequently develop a much clearer idea of what constitutes a "bargain". Only after doing enough research will you be able to recognise an opportunity when it presents itself, or when your offer has been accepted :)

    Besides going to opens, what else are you doing to find out more about a specific area?

    Forecasting future cg in any town, including Sydney, can be akin to crystal ball gazing. One can use historical growth and factors such as rental reality to help narrow down the search area, but there's more to it than mere statistics, as I'm sure you're only too aware! Basic fundamentals such as position, rental demand and supply, proximity to transport/shops/schools etc all play an essential part in selecting the right investment.

    I can't really comment on all of the areas you mention as I'm not intimate with them, but I'd be looking at something closer to the city for your money and selecting areas that historically have shown solid growth for units at around 7-8%+ over a 10 yr period. Lower north shore is a popular area, and $300K can still get you something in a decent 1 bedder or a 2 bedder (more likely on a busy road for the extra bedroom) and the inner west region is also a popular choice, particularly as the train line provides the option for fast transport into the CBD. I especially like the Summer Hill area, for it's affordability and proximity to the station, as well as all it's cute period homes :D

    In Blacktown, however, as you're aware, $300K will get you a house. Older, yes, fibro or weatherboard, probably needs work, is rundown and may not be in the better parts of this suburb. However, for my money, I'd be looking hard at nearby Seven Hills (Kings Langley side) for the bargains. With prices dropping over the last 2-3 yrs, there are now some real beauties coming onto the market in the low $300K's which would make great reno jobs :D

    Please note the above is my opinion only :)
    Good luck with your quest and let us know when you decide where you wish to buy. Sydney may well be in for a quiet period, but it also represents a time of opportunity for those who are cashed up to take advantage of the current doom and gloom mentality.
     
  12. hiflo

    hiflo Well-Known Member

    Joined:
    3rd Jun, 2006
    Posts:
    68
    Location:
    Sydney, NSW
    Thanks for your comments.

    I think you are right about me diversifying my search and if I were interested in just getting a bargain, I could probabaly have found one already.

    Only thing I have done aside from just going to open houses is that I bought Residex Report showing prospective growth of suburbs in Sydney and thinking of getting in contact with a Buyer's Agent to see if they can really help in my situation. (But first thinking that I should be armed with all the information I can get).

    I have bought a residex report with top 100 suburbs having the best potential for capital growth. However, I take that with a grain of salt because it conflicts with my observation of housing prices in the area. According to Residex Report Coogee area is supposed to be doing really well (for units) but as far as the units are concerned it hasn't been performing well. Units in Coogee/Randwick/Maroubra, are at 2000 prices (the older style brick units without view to ocean) and some investment unit owners of the area are complaining that they should have refinanced in 2003 when the units were valued 20-30% more. The rent in Maroubra is not great either because of supply despite all the news that there is rental shortage in Sydney market.

    Since I live in the area, I see more units/apartments being built and this makes me really cautious about buying my first property in the area as I see lot of unsold empty ones as well.

    Because I know the area quite well (I hope, it might be an illusion), I could possibly buy something if a bargain turns up but I would need to budget at least $350K + to buy something in a desirable street, so buying it below $300K would be a real bargain for me. I may consider a studio ($250-$280K in the area for 50m2), but I do not think it is popular, and I may find it difficult to sell at market price(should the need arise from change of my financial circumstances.)

    [In the current static real estate market in Sydney] So my next step is as well as going to open houses (a drive in the area to check the main infrastructure and the feel), I am trying to obtain, sales history for past 10 years to see whether the region had real capital growth for median house price for units. This can be an expensive exercise, because I would have to buy it postcode by postcode unless I can befriend a real estate person who will give it to me.

    I am thinking of attending auctions which I haven't got around to yet, which I should be doing weekday nights.

    [If I see signs of market picking up] I will probably buy a house in outer Sydney just to get the capital growth. I am thinking just outside Parramatta at the monent for no apparent reason but Parramatta being another centre for Sydney and its transport connections. And that is why I plan to go outer Sydney for some inspections in the future.

    Thanks for your input Jacque