What would Warren Buffet know about RE?
http://www.news.com.au/finance/mone...way-shareholders/story-e6frfmdr-1226836794534
He does like Real Estate as a class, his main problem is price, He says its hard to find real estate investments at a price that would excite him.
He outlasts everyone in the market. While everyone is "dancing in and out of the market", he is looking at accumulating business certainties. Far sighted he surely is though I wonder if he is addicted to 'more'. How much is enough?He also said this "focus on what an investment will produce, not its price"
"focus on what an investment will produce, not its price"
He outlasts everyone in the market. While everyone is "dancing in and out of the market", he is looking at accumulating business certainties. Far sighted he surely is though I wonder if he is addicted to 'more'. How much is enough?
Smartest property investor is my GF she
Bought a 1 bed unit at balmain in 1983
For $47,000 sold it last year for $415,000
Put it into the 5 bed home at camden worth
$440,000.
She paid balmain off in 10 years by paying
The high interest in the recession we had
To have, she kept paying the high payments
After interest rates came down & it was
Paid off real quick.smart girl...tb
He outlasts everyone in the market. While everyone is "dancing in and out of the market", he is looking at accumulating business certainties. Far sighted he surely is though I wonder if he is addicted to 'more'. How much is enough?
Smartest property investor is my GF she
Bought a 1 bed unit at balmain in 1983
For $47,000 sold it last year for $415,000
Put it into the 5 bed home at camden worth
$440,000.
She paid balmain off in 10 years by paying
The high interest in the recession we had
To have, she kept paying the high payments
After interest rates came down & it was
Paid off real quick.smart girl...tb
Sorry ... I must have missed this emoticon ...
He also said this "focus on what an investment will produce, not its price"
He outlasts everyone in the market. While everyone is "dancing in and out of the market", he is looking at accumulating business certainties. Far sighted he surely is though I wonder if he is addicted to 'more'. How much is enough?
$47K of '83 dollars was $147K of 2013 dollars.
How much did the starta fees and council rates cost over the 30 years?
How much interest + management fees did she pay?
How much did the insurance cost?
How much maintenance and renovations costs did she pay?
Probably doesn't look like such a great annual return once you factor in inflation and holding costs.
In any case, I would be surprised if this was not a good outcome considering how overpriced the oz market is for real estate..
causes have been dioscussed ad nauseum here
True, but it may not be that positive and there is the opportunity cost:
you should indeed added both these costs and incomes and then compare these on cash return or if braver on the asx200.
then it becomes meaningful.
but I also agree that it is a much better outcome than having bought a new luxury car!!!!
In any case, I would be surprised if this was not a good outcome considering how overpriced the oz market is for real estate..
causes have been dioscussed ad nauseum here
Those costs wouldn't be deducted from your capital gain, you would have paid for them with the annual rent you were earning ( or saving if you lived in it)
I constantly see people make similar comments on this thread, its like everyone forgets to add in the rent.
As soon as somebody says they have made a $x capital gain, people say you have to factor in all the annual costs against that gain, but if your going to factor in those annual costs, then you have to add in the 100's of thousands of $$$ of rent earned over that time.
people also make the same mistake in the gold thread,
They compare the price of gold increases from 2000 to present to the price of the asx 200 index over that time, without factoring in the dividends, which gives a phony outcome.
But a property will generally produce a lot more rent than the annual costs, I would be surprised if a landlord on average had to outlay more than 25% of rent received to cover all costs including maintance.
You need to account for al costs and income to show what the true ROI was.
Just saying I bought at X in 83 and sold for Y in 2013 isn't very informative. It's what most do when talking about housing. Ignoring inflation over such a long time frame is not good.
I doubt the rent would have totalled to hundreds of thousands over the 30 years, even adjusting for inflation.
The most recent Census data shows us that of those homes occupied, 29.6% are rented (investment properties). Based on this data, if we assume that without the private sector building homes for investment purposes, the public sector would have to account for 29.6% of all dwelling approvals to cover those in rental accommodation. Over the past 12 months this would have equated to 43,684 dwelling approvals. If we also consider that the median home price across Australia as at October 2012 was $386,000, and if the Government had to buy the land and build 43,684 homes, this would cost the Government of the day $16,861,900,480 based on the number of approvals and the median home price.
You need to account for al costs and income to show what the true ROI was.
Just saying I bought at X in 83 and sold for Y in 2013 isn't very informative. It's what most do when talking about housing. Ignoring inflation over such a long time frame is not good.
I doubt the rent would have totalled to hundreds of thousands over the 30 years, even adjusting for inflation.
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