Good job LeoT. I always enjoy reading the interviews here and seeing the paths other people have taken
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Lets say assuming I've done all my DD on an area and my research concluded that to meet my own goals, I should be buying a 600sqm or so house with 3 bedrooms and should also not be renovated. This is how i try to find out its intrinsic value of the particular target I'm looking at:
1. Research all recent sales in the area, comparing size, bedrooms, condition of house, any unique street appeal eg water views, any constraints eg on main road etc
Step 2: How do you now go about actually trying to get it BMV?
Well IMHO this is where strong negotiation skills/tactics can greatly help. Assuming i am targeting a house that's on the market for 570k. First i use RP data Professional to investigate as much as i can what i'm dealing with
Good job LeoT. I always enjoy reading the interviews here and seeing the paths other people have taken
Very inspirational interview Leo. The focus and dedication you had from such a young age is quite amazing.
I'm half way through think and grow rich, and finally starting to grasp the importance of mindset.
Hey Leo,
Great read! I have also been enjoying reading your posts, you have really drummed the mindset thing in, I went out and bought another 10 books today!
HI SK Investment, I'm glad you have enjoyed some of my posts. COngrats on your new book purchases! Just curious some of the books you bought ? I remember quite a few years ago now I would go to all the book shops and buy every single property book on the shelf. Then drive to the next book shop and look for new ones i didnt have have get those. Then I would buy every single mindset book on the shelf. Then did the same with autobios of successful business people. Ive been doing that till today!(the main reason i nag and nag about mindset is because from everything i have read/learnt/personally experienced, the most successful business ppl. athletes etc all have a very well developed and sophisticated mindset. The reason why so many ppl dismiss it/resist it is becasue it is the hardest thing to change IMO.
Couple of questions;
1. Can you be my mentor? Mate there are heaps of resources, books, cds, dvds and many great folk on the forum to help you along the way
2. Does your wife have a sister? No, you can thank the Chinese government for their 1 child policy! Cheers,
Keith[/QUOE]
Great interview Leo!! Your posts are always inspirational and helpful!Thank you for sharing your experience!!
NP, glad you found it helpful!
I am also only starting with properties, working on mindset and reading, reading, reading.... books, internet, somersoft, magazines, anything really I can find...
Awesome! I have always long believed that ppl who are really serious about their investment goals will be hungry to learn everything about property investing in the beginning. Good on you! Have you started building your portfolio yet?
You mentioned mentoring colleagues and friends so if you ever decide to mentor somersoft friends let me know, I would be in
hehe no worries, To be honest i dont do much 1:1 mentoring anymore, but like i said to SK Invesmtents, there is more than enough info out there, as well as a fantastic forum here to ask questions to some very experienced folk who are always happy to help.
Thanks again, well worth read![/QUOE]
Cheer
Leo
Waiting to read your story, Westminster
Great interview LeoT
One comment with your ownership structure.
Try and get those properties that are in our own name and in joint names into a trust structure. I mention is now as you may not have build up equity on these properties and a change over cost is lower.
The reason I mention it is you are a young guy and your going to meet a lady. She may not be the right lady but you take 2+ years to decide. She departs and puts out her hand for her share as she is now your defacto.
Even worse if you were to pass away (heaven forbid) and she now is in line for a substantial share and is actually your next of kin. She will just move on and have a ball enjoying your wealth.
Have a read through some of this site to get a feel for the problems.
http://www.armstronglegal.com.au/contested-wills/
I am speaking from experience having started the same way with properties in my own name etc. Trusts are the way to go. Don't even need to leave anything apart from the appointer and trustee arrangements.
Keep up the good work.
Cheers
"7.What criteria do you use when selecting an area to purchase in?
When I used to buy IPs, I would always follow some basic rules which I feel have served me well over the years.
1. Buy in the state that is on the climb (7-9 oclock). (I never buy at the peak of a boom market. Ever.)"
How do you find out or derive the type of market a particular state/city/suburb is in?
Leo,
Which are your favourite sites for doing your macro DD?
I dont really pay much attention to the macro stuff. I stay away from the obvious places of high unemployment, high crime rate, stagnant population growth but thats mostly about it.
And before that happens, what methods do you use to find the areas to start your research? Do you do it like Lomas: start with the whole country and drill down progressively?
1. Choose state. Personally i stay within 45km for syd cbd, 15km for Brisbane cbd, 30km for melbourne cbd, 5km for Adeliade. Canberra, NT and tassie not on my radar.
2. Choose suburbs that fit my buying critera.
3. Choose deals/sites that i am interested in according to my finance ability.
How many areas do you shortlist at any one time?
3-5.
Do you keep this data on a spreadsheet?
No my wife does that.. im more a visiual person so for example if im looking at Brisbane, I will blow up a map, stick it on a cardboard, and use a compass to draw a radius of 5km, 10km, 15km etc from the cbd. It helps me a lot to see it this way and put it in perspective. Then i just stick things on the map. When im in the researching/buying phase of an acquisition, my office/room floor is a warzone
Is RP Data Professional tax deductible?
Yes.
What do you use to do your pre-selection financials? Your own spreadsheet? Somers' software? Back of envelope
Brilliant finance brokers. IMHO a serious investor wont waste time trying to do the finance him/herself. The benefits of finding and using a great broker far outweigh any reason to chase the finance yourself IMO. Thanks, Leo
Yes great interview Leo, i enjoy your posts too. And if you are still single with no kids who will you leave the empire to?
Good stuff Leo, great read currently embarking on my first development.
Would be great to hear more on the development side of things if you ever get free time
Have you heard of 'notional estate orders' under the Succession Act in NSW?
Trust assets can be divied up on death if an eligible person makes a claim on your estate and your personal assets are not enough to satisfy the claim.
Also you have to consider protection from beneficiary attack. What if you die leaving one trust with 2 children?
Brilliant finance brokers. IMHO a serious investor wont waste time trying to do the finance him/herself. The benefits of finding and using a great broker far outweigh any reason to chase the finance yourself IMO. Thanks, Leo :
1. Choose state. Personally i stay within 45km for syd cbd, 15km for Brisbane cbd, 30km for melbourne cbd, 5km for Adeliade. Canberra, NT and tassie not on my radar.
2. Choose suburbs that fit my buying critera.
.
Perth is not on your radar either?
Now that your IP strategy has evolved, are you still doing buy-and-holds or just developments?
No my wife does that.. im more a visiual person so for example if im looking at Brisbane, I will blow up a map, stick it on a cardboard, and use a compass to draw a radius of 5km, 10km, 15km etc from the cbd. It helps me a lot to see it this way and put it in perspective. Then i just stick things on the map. When im in the researching/buying phase of an acquisition, my office/room floor is a warzone
Very cool. Like those TV shows when the cops strategise on their maps to catch the baddies
What do you use to do your pre-selection financials? Your own spreadsheet? Somers' software? Back of envelope
Brilliant finance brokers. IMHO a serious investor wont waste time trying to do the finance him/herself. The benefits of finding and using a great broker far outweigh any reason to chase the finance yourself IMO.
I like that. My head was not built for maths
Leo, I meant the calculation to assess whether a property was viable. What tool do you use to do the financials?
Hi Catalyst,
I am not sure if i understand what you mean by "type of market" , but i think your refering to where each state/city is in, on the property clock?
There are also some good indicators I have found. When SOM is going down, Discounting rates are starting to decrease, general market sentiment is changing.. media start talking very positive about a state etc.. (not that i ever care what the media says, BUT what they say does change market sentiment and that is important to note and make use of).
Sorry for the long post.. but some of these questions can just be answered in 2 lines...