Jul 23 2007, 12:37 AM
QUOTE(tinkerbel @ Jul 18 2007, 05:22 PM)
@b00n,
You've a point. Anything on PAPER merely remains as on paper. Take for example, if i'd paid RM100k for a house, and it's market value today is RM500k, the RM400k gain [for easy calculation, let's not take into account of interest, etc.] can only be realised IF u SELL the house to someone who's willing to pay RM500k for the house. If I don't sell the house, it makes no difference whether the property is RM1m today or not - because there's no intention of liquidating the asset.
Ahhhh, but there is a way of realising the capital gain immediately without actually selling the house, should you need money. All you have to do is just go to the bank and get a loan with the house as collateral. Sure, you pay interest on the loan, but remember, the house is still yours! How to use the money, you think yourself.........You've a point. Anything on PAPER merely remains as on paper. Take for example, if i'd paid RM100k for a house, and it's market value today is RM500k, the RM400k gain [for easy calculation, let's not take into account of interest, etc.] can only be realised IF u SELL the house to someone who's willing to pay RM500k for the house. If I don't sell the house, it makes no difference whether the property is RM1m today or not - because there's no intention of liquidating the asset.
Added on July 23, 2007, 12:41 am
QUOTE(b00n @ Jul 19 2007, 09:47 AM)
Again on loans for the 4th property, you have to understand that banks doesn't treat rental income as your income. It would only treat the 1st 3 properties as your liability.
Added on July 23, 2007, 1:21 am
QUOTE(wcwroger @ Jul 19 2007, 12:23 AM)
My story:
I've read dozens of property investment books for years. 4 years ago, the idea of venturing into property investment sparks me after I've attended a property investment seminar by our very local property investor, Renesial Leong (u may read her success at www.upia33.com). I do invest in stocks too, quite heavily at one time
Anyway, my story continues below...
Year 2005 (Salary: RM2500)
I jumped start by buying my first property, a condo, without any downpayment for RM150k. I signed a 15 years contract with the developer, with the criteria having the rental paid to me RM900 monthly for 15 years. Then, I secured my financing with a local bank. Managed to work out installment of only RM850 for 30 years. Positive cashflow of RM50 per month. Dun forget, my salary is still untouch
2nd and 3rd property are rather unique.
Year 2006 (Salary: RM2800)
I bought my 2nd property together with my brother who has the same earning power as mine. Together we bought a RM250k worth of property. Secured a local bank loan and work out the installment to be only RM750/month/person. Ok wat.....
Year 2007 (Salary: RM3000)
Recently, I've just bought into RM380k worth of property together with my wife who has the same earning power as mine. It's for own stay. Secured my company's loan (interest rate a slightly lower than local bank) and work out the installment of only RM1000++/month/person. Ok wat...
Year 2008 (Salary: hope it rises)
Rent out some of the rooms from the 2nd and 3rd property to help service the installments. Hence, boost my monthly income enabling me to secure another bank loan for my 4th property as an investment...
Year 2009 (Salary: rise rise rise)
Buy my 5th property, by manipulating my 1st, 2nd or even the 4th property. How? Read 'em up... it's all in the books. Attend seminars! Learn from the successful people.
Hope I did shed some lights to some of you out there.
Nothing is impossible
Cheers
Roger
wcwroger@yahoo.com
wcwroger,I've read dozens of property investment books for years. 4 years ago, the idea of venturing into property investment sparks me after I've attended a property investment seminar by our very local property investor, Renesial Leong (u may read her success at www.upia33.com). I do invest in stocks too, quite heavily at one time
Anyway, my story continues below...Year 2005 (Salary: RM2500)
I jumped start by buying my first property, a condo, without any downpayment for RM150k. I signed a 15 years contract with the developer, with the criteria having the rental paid to me RM900 monthly for 15 years. Then, I secured my financing with a local bank. Managed to work out installment of only RM850 for 30 years. Positive cashflow of RM50 per month. Dun forget, my salary is still untouch
2nd and 3rd property are rather unique.
Year 2006 (Salary: RM2800)
I bought my 2nd property together with my brother who has the same earning power as mine. Together we bought a RM250k worth of property. Secured a local bank loan and work out the installment to be only RM750/month/person. Ok wat.....
Year 2007 (Salary: RM3000)
Recently, I've just bought into RM380k worth of property together with my wife who has the same earning power as mine. It's for own stay. Secured my company's loan (interest rate a slightly lower than local bank) and work out the installment of only RM1000++/month/person. Ok wat...
Year 2008 (Salary: hope it rises)
Rent out some of the rooms from the 2nd and 3rd property to help service the installments. Hence, boost my monthly income enabling me to secure another bank loan for my 4th property as an investment...
Year 2009 (Salary: rise rise rise)
Buy my 5th property, by manipulating my 1st, 2nd or even the 4th property. How? Read 'em up... it's all in the books. Attend seminars! Learn from the successful people.
Hope I did shed some lights to some of you out there.
Nothing is impossible
Cheers
Roger
wcwroger@yahoo.com
I see you're trying to practise what the seminars and books tell you.
Allow me to be a bit critical of your 1st 3 properties. Your return on your 1st property in 7.2%/year. I am not sure what loan package you have, but i think it would be BLR+0.??%, meaning between 6.5-7.5%, no? 15years guaranteed return is good, but it should have been able to negotiate rental every 5years . You end up with a +ve cash flow of RM600/year. But how much do you have to fork out for quit rent, assessment, fire insurance & income tax?. I hope for your sake too, that the agreement with developer states that any repairs if bourne by tenant! Also, if your agreement if 15 years duration fixed, then it would be hard to sell your property as your only target are investors, and how many investors are keen on a property offering only 7.2%/year return?
As for your 2nd and 3rd property, they are not even for complete rental. Renting out rooms are ok....if you can live with strangers in your home, but I'm not sure if that's sustainable. Honestly, I hope there is capital appreciation for you in the end. If I were you, I will save like hell to pay off your non profit generating loans first and forget about buying another property at present.
Sorry for being harsh.
minolta
This post has been edited by Minolta: Jul 23 2007, 01:21 AM
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