I have given up buying a house

[Julia]

According to clowboy, I should beg, grovel and plead for a refund of my extra super contributions, make a beeline to my local Coles or Woolies, grab a trolley and load it full of cr_ap. (chocky biscuits, cakes, soft drink, chips). Then sit back on my couch, and wait for the lard to grow until I need gastric bypass surgey

Ohhh how the mind boggles

I am laughing so hard internally, at least if the tuna doesn't kill me, the laughter will

I am really confused I thought the staple diet of humans came from the earth and the sea not from Coles and Woolies shelves.

STC
Clowboy hasn't suggested anywhere that I can see that you should pig out on junk food. He just made the reasonable suggestion that in your quest to pile more dollars into Super, you shouldn't make your life and/or diet too rigid.

If you genuinely like eating tinned Tuna (and there's nothing wrong with most Home Brand products that I've tried), then, great, have it. But if you're eating it just because it's cheap, then I agree that you shouldn't do it all the time. Occasionally instead treat yourself to some fresh raw tuna (very expensive and utterly delicious) . You'll probably never eat tinned tuna again!

Although I respect your capacity to save money (as long as you're not bludging off others in order to do so), and think more people of your generation should be doing the same, I think it's unhealthy to become so obsessed about it that you lose sight of enjoying the present. Like all things, balance is best. Money can become an addiction like other substances and habits.

Julia

 

[Realist]

As one example I put zero down (Equity secured) paid $90K and sold 3 yrs later at $210K.So I picked up $120K for the grand cost of Zippo.

Buy House $90K
Sell House $210K
Profit = $120K ????

Conservative Estimates...
Stamp duty = $6K
Interest over 3 years on $90K = $15K
Mortgage Fees = $3K
Agent fees/advertising = $5K
Repairs, improvements, insurance, rates, = $10K
YOUR TIME = $20K
CGT Tax = $30K

Your profit = $30K

Sounds more realistic to me...


Don't fool yourself into thinking your killing it with property, your house more than doubled and you made $30 to $50K.

Guess what will happen if your house dipped just 10% in value...

 

[krisbarry]

STC
Clowboy hasn't suggested anywhere that I can see that you should pig out on junk food. He just made the reasonable suggestion that in your quest to pile more dollars into Super, you shouldn't make your life and/or diet too rigid.

If you genuinely like eating tinned Tuna (and there's nothing wrong with most Home Brand products that I've tried), then, great, have it. But if you're eating it just because it's cheap, then I agree that you shouldn't do it all the time. Occasionally instead treat yourself to some fresh raw tuna (very expensive and utterly delicious) . You'll probably never eat tinned tuna again!

Although I respect your capacity to save money (as long as you're not bludging off others in order to do so), and think more people of your generation should be doing the same, I think it's unhealthy to become so obsessed about it that you lose sight of enjoying the present. Like all things, balance is best. Money can become an addiction like other substances and habits.

Julia

Come on, come on people....lighten up, I still enjoy great food occassionally. Nothing beats a thick cut of steak or a tasty chicken breast.

I was also poking fun at Clowboy...running with a little humour on this fine Friday!

 

[krisbarry]

On a more serious note, it still puzzles me why my generation have to pay for our education and our pensions and still afford to eat nice cuts of meat and buy over priced homes, while listening to ipods and jet-setting around the world

How insane is that

 

[cogidubnus]

On a more serious note, it still puzzles me why my generation have to pay for our education and our pensions and still afford to eat nice cuts of meat and buy over priced homes, while listening to ipods and jet-setting around the world

How insane is that

I agree sonny. I think all you young whippersnappers should give all your worldly goods to old codgers like me.

 

[krisbarry]

Ohhh thats right it was the previous generation that got free education, affordable housing and nice cuts of meat from the backyard farm, all while listening to the wireless and collecting a pension... how times have changed :

 

[cogidubnus]

Ohhh thats right it was the previous generation that got free education, affordable housing and nice cuts of meat from the backyard farm, all while listening to the wireless and collecting a pension... how times have changed :

Ah yes I remeber them well.. the good ol days

 

[Smurf1976]

Totally off the topic of housing but relevant to the debate about tuna.

My mother acquired two kittens in 1984. One was quite normal whilst her sister seemed to be the weak runt of the litter, was small, easily bossed around by the other cats and lacked strength.

The stronger cat ate normal things like tinned cat food etc while the weaker one refused to eat such things. She ate mostly raw mince, tinned tuna and cheap cat biscuits. She simply wouldn't eat brand name biscuits or tinned cat food.

Bottom line is that the "strong" cat eating processed cat food passed away in 1998 while her sister remained in good health until 2004. The "weak" cat eating natural food lived a lot longer than the "strong" one eating processed food and remained reasonably fit right to the end.

I tend to avoid processed foods...

 

[Jay-684]

Buy House $90K
Sell House $210K
Profit = $120K ????

Conservative Estimates...
Stamp duty = $6K
Interest over 3 years on $90K = $15K
Mortgage Fees = $3K
Agent fees/advertising = $5K
Repairs, improvements, insurance, rates, = $10K
YOUR TIME = $20K
CGT Tax = $30K

Your profit = $30K

Sounds more realistic to me...


Don't fool yourself into thinking your killing it with property, your house more than doubled and you made $30 to $50K.

Guess what will happen if your house dipped just 10% in value...

Going off S.A stamp duty rates stamp duty would be $3,000 not $6,000
Interest assuming a 20yr loan, 90,000 principal, 7.5%p.a. compounded monthly, Interest payments after 3yrs = $19815.90
Mortgage fees - approx 1% = $900
RE fees - $5,000
Rates - again going off SA rates, for the 3 years (assuming the rates are calculated off the market value of the property which they clearly arent, and assuming an annual growth rate of 32.64%) - $1866
Repairs and improvements - who says there were any?
Your time - $20,000 is very excessive. Going off average wages of $1043 per week, thats 920 hours on the property over 3 years assuming a 48hr working week. To be realistic maybe 6 weeks is reasonable, so assume $6258
CGT based on 05/06 taxation rates would be 30% of $120,000 (not getting into depreciation allowances, tax deductions on interest repayments etc) 3$36,000

Total expenses = $72839.90

So total gain on the initial value of the investment is $47160.10

However realist, what your not realising is that Tech/A put NO MONEY DOWN ie he had no initial investment! 100% debt finance was used, therefore the return is quite impressive indeed. He still had 100% of his equity to invest in other areas.

 

[Realist]

However realist, what your not realising is that Tech/A put NO MONEY DOWN ie he had no initial investment! 100% debt finance was used, therefore the return is quite impressive indeed. He still had 100% of his equity to invest in other areas.

Agreed,

But please consider the house went up 233% in value in what is one of the biggest property booms ever.

He made at most $47,000 - which will buy you a nice second hand German car. Woop de do.

 

[AAA]

And how much did you make out of the property boom?

 

[tech/a]

Buy House $90K
Sell House $210K
Profit = $120K ????

Conservative Estimates...
Stamp duty = $6K

Tax deductable taken off the capital gain at sale.

Interest over 3 years on $90K = $15K

Rent return over the 3 yrs $35,800

Mortgage Fees = $3K

If you mean conveyencing then that was $1690

Agent fees/advertising = $5K

Was actually $7500 I gave them an incentive over $200k

Repairs, improvements, insurance, rates, = $10K

Around the mark.

YOUR TIME = $20K

We self manage our properries so any cost you wish to allocate we keep.

CGT Tax = $30K

After our complete business dealings for the year were calculated the figure was around $18500.Thats for the accountants.

Don't fool yourself into thinking your killing it with property, your house more than doubled and you made $30 to $50K.

Realist the last thing I do is fool myself.This is one of 4 sales in the last 3 yrs.
Leaving me with 3 freehold including my business property reciently valued (before buying Cash for my superfund) $550K.

Guess what will happen if your house dipped just 10% in value...

Urrrr it would be worth 10% less.

There are a few people here who "get it"

Zero down and X profit---be that 120K or 20K fact is its ZERO DOWN.

Also how did you make 338k out of 30 in 3 years

Im a systems longterm trader.
I trade 3 Mechanical systems Each with a starting base of $30K.
One is fully disclosed on Reefcap and is the same as one of the methods I trade.My results are similar to that which has been running live for 4 yrs on Reefcap.

The trick is Margin leverage,Positive expectancy,re invested profit.Which is all explained in the Techtrader Forum on Reecap.

 

[professor_frink]

Agreed,

But please consider the house went up 233% in value in what is one of the biggest property booms ever.

He made at most $47,000 - which will buy you a nice second hand German car. Woop de do.

$47,000 profit on no capital outlay at all. I'd say that's worthy of a bit more than a woop de do

47,000 wopp de so's may be in order!

 

[NettAssets]

Realist has not sold anything ever - so any profits are only illusory and therefore untaxable. I would not be suprized if he still has his first nappy still in its original wrapping
He is incapable of understanding that there is no difference between the taxes that you are forced to pay while selling your soul to a boss and those on a trading transaction.
John

 

[cuttlefish]

Realist - I believe that investment properties also earn rental income - don't see this anywhere in the equations above.

And if you bought out of Sydney at the right time you could get yields that matched or exceeded the interest payments (i.e. positively geared).

 

[Jay-684]

Agreed,

But please consider the house went up 233% in value in what is one of the biggest property booms ever.

He made at most $47,000 - which will buy you a nice second hand German car. Woop de do.

Your not thinking about it properly.

He made $47,000 from nothing! Didnt use one cent of his equity to gain that money.

Explain to me how you can do that with shares!

And as was stated above, it didnt even include rental income!

 

[nioka]

I haven't had an answer to the question as to thether or not you are still living at home and bludging on your parents (or your mates). Does no reply mean YES.?

 

[Realist]

Well what I said is correct, you need to take all expenses out before quoting what you made.

Property investors and traders forget this simple fact.

Tech/a did well obviously, better than me. I did not buy a house before the housing boom and have not bought one ever. Laugh as you may but Sydney property has gone down for 3 years in a row now, I'm quite enjoying having shares and no mortgage thank you very much.

My point was twofold : that Tech/a made a profit but nowhere near the $120K he first spouted. And secondly his profit considering the house went up 233% in value was not that impressive in reality.

$47,000 in Sydney would get you a carspace for 2 years.

Anyone who says "yeah but he put no money down" is not taking into account the huge risks in doing this. HAd Tech/a bought in Sydney 3 years ago with no money down he could be bankrupt by now, he'd have lost hundreds of thousands of dollars.

His example worked, if you want I can look up an example of someone spending $5 on a lottery ticket and becoming a millionaire overnight. Because it worked in the past does not necessarily mean it will work for you, or even for him in the future.

Everyone's a property guru and a share expert during bull markets.

Tech/a's strategy will backfire big time for those that try this when houses turn for the worse - AND THEY WILL!!

 

[brisvegas]

ASF integrity taking a hammering here . this guy is krissbarry reincarnated . instead of telling people how to do it when YOU have little experience how about listening to those that HAVE done it and learning something . how about a little intelligent critical thinking with meaningful dialogue based on logical conclusions . belligerance and pompous rhetoric will lead nowhere fast .


keeping it real .................... bris

 

[lancedefrance]

Im a systems longterm trader.
I trade 3 Mechanical systems Each with a starting base of $30K.
One is fully disclosed on Reefcap and is the same as one of the methods I trade.My results are similar to that which has been running live for 4 yrs on Reefcap.

The trick is Margin leverage,Positive expectancy,re invested profit.Which is all explained in the Techtrader Forum on Reecap.

Thanks for the reply although i didnt really understand it because I am a complete NOOB :hide:
I will be heading over to the techtrader for a read soon so hopefully it will all make sense once i start understanding the basics