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10 highly dangerous ‘tips’ investors get

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Your Investment Property | 21 Dec 2011, 12:00 AM Agree 0
You're sure to find trouble if you follow common, but ill-advised suggestions, such as buying in an area just because the rents are high or investing in the US. Read carefully as we reveal 10 “pearls of wisdom” you should probably ignore
  • Gail L | 19 Jan 2013, 04:49 PM Agree 0
    Americans are not buying property because they can't get finance. Their complex credit score system means if they are foreclosed after a job loss or similar, it can take them years to build up a credit score to apply for another loan. And the banks are now very conservative about their lending (about time!). Americans also do not have the interest in property investing that we Aussies do - it's a different mindset. Property investing in the US for Aussies is a big risk - you need to do your research - physically in the US - not on the internet - and develop the right networks over there. You need to be prepared to set up LLC's, file IRS returns, open US bank accounts, have a mail forwarding service, hire a US CPA, set up asset protection measures for your Aussie assets, educate yourself on US property etc. etc. It's not something you do lightly and at low cost but there are benefits if you do it correctly. We toured the US 2 years ago, bought 5 properties across 3 states which are all returning between 14% and 21% net per annum. There are also great opportunities to keep secure tenants by offering "rent to own" to good tenants who lost their homes in the GFC through no fault of their own and either cannot save for a deposit or do not have a high enough credit score to apply for a loan. It is hard work and things don't always go smoothly but we have found it very profitable and rewarding.
  • Simon | 19 Jan 2013, 07:58 PM Agree 0

    Reply to 'do not Invest in U.S.'

    I bought in Gilbert, AZ, $31k and sold at $75k after 5 months.
    Bought off bank's foreclosure list for cash.
    April 2012.

    At the time, the local US citizens were too debt laden and with bad credit to buy anything.

    In recession times, cash is king.
  • Roger O | 22 Jan 2013, 02:35 PM Agree 0
    OK so I am guilty of adopting tips 1, 2, 4, 7, 8 and 9. My SMSF paid $450k cash for 3 houses and 4 duplexes in the USA, the properties have been returning $70k I guess I am living dangerously....??
  • JAW | 09 Oct 2013, 05:59 AM Agree 0
    I agree with the others comments --i recently took advantage of a 3.1% interest rate here in the US -purchased a home in Houston -looks like we done ok -houston is seeing incredible growth .. Compare that to my rental in Perth and the interest i pay on the Aussie loan -i'm wondering why i'd ever buy in Oz again ...
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