You can even ask the questions

Just a quick update, I am really excited to be sharing some valuable information in one of a series of Business Masters Interviews.

You won’t want to miss this FREE teleconference.

I am being interviewed by David Zeltner from Cash Profit Coaching on “How to Take the Headaches out of Property Investing”

I will be sharing some great information that I know will support you. David will be asking me some really specific questions, however if you have any burning questions that you want answered please email them to david@cashprofitcoaching.com.au in 50 words or less before 10am in the 1st February. David will collate them then I will answer them for you.

FREE Tele Conference

Time: Wednesday 1st February 6.15pm – 7.15pm Sydney Time (AEDT).

(6:45 CDT / 3.15pm WST)

*Please note this tele conference is limited to a number of lines so it’s a case of first in scenario.

Click this link for more information and your login details http://tinyurl.com/businessinterviews

I look forward to answering your questions.

TO SIGN UP CLICK HERE…

Paul Pritchett

Portfolios

As we look towards taking a break over the Summer and setting those New Years resolutions,  I have come across some interesting research that seems to suggest that health is linked to your wealth.

But what is wealthy?

It seems that how much we exercise to stay fit is linked to how much we earn. That wealthier people are more likely to take part in physical activities more than those less well off.

According to the Australian Bureau of Statistics those in the wealthiest income groups were more likely to engage in a number of fitness activities. The least wealthy were less likely to pursue any physical activity at all.

Why?

Well the answers are partly speculation and I welcome your input on this one, but I offer up some suggestions below. I caveat this with my desire that you would think about how you can be more positive towards your health in 2012. Note that very few of the offerings below relate to how much money you have.

More Free Time

I think wealthy people have more spare time than their less wealthy counterparts. The priority of exercise and health is high on the agenda as is spending time in social settings and recreation.

More Organised Time

If they are busy – wealthier people seem better able to distribute their time well to make space for physical pursuits.

Greater Determination

Often people gain wealth through sheer determination and strict planning. This will generally flow into all areas of their lives. The determined take control of their lives and this includes keeping fit.

More income to spend on luxuries /  healthy foods

Although the wealthy are usually cautious about their spending they will have a greater disposable income to spend on extras like gyms, classes and personal trainers. They will also prioritise spending to ensure they have the best equipment to support them.

Why Is Health Important?

A 2008 published study from Cambridge found that of over 20,000 men and women between 45 and 79.

The study looked at a combination of four activities including regular exercise, moderate alcohol use, daily fruit and vegetable intake and not smoking. Over the study period those who took part in none of the above activities were four times as likely to have died than those who engaged in all four.

Practicing the four healthy habits according to the research was equivalent to being 14 years younger in chronological age. 1

Who are the wealthy?

The research I have done refers to the wealthy in terms of income status.

Wealth is also an attitude you choose long before you make sustainable money for yourself. Being at peace with where you are at, a healthy and well balanced life is available to everyone.

As you can see above – simple lifestyle choices cross over wealth boundaries – they are available to all of us. Its not conclusive but could be the start of better things for you.

It is my hope you will take 2012 by the reigns and make it your year to get healthy and build your wealth portfolio as well. At Portfolios we look forward to standing along side you as you do.

From August 1^st this year, the Queensland Building Boost Grant of $10,000 will become available to any person or corporation buying or building a new home to live in, or to rent out for investment purposes, for homes less than $600,000.

This grant is designed to re-ignite the state’s housing sector after a tough year of falling property transfers and economic impacts from the destructive floods and cyclones. We’re in for an upswing!

If this Boost isn’t enough to get you excited, the Super Boost that is going to occur in QLD definitely will. But first things first, let’s answer some essential questions about the $10,000 grant:

What is the Queensland Building Boost Grant?

It is a grant of $10,000 to any person or entity that is buying a new house, building a house, buying a house and land package, or buying a property off the plan.

Who can obtain the grant?

Home buyers, investors (18+ years of age), companies and trusts.

How long is the grant going to last for?

It commences from 1 August 2011 to 31 January 2012, so be quick!

What is the house value limit?

The home or the house and land must be under $600,000.

Do I have to live in the new home?

No you don’t, but there is an occupancy requirement. The home must first be occupied as a place of residence by somebody. This may be yourself, your family or friend, or your rental tenants.

You cannot build the house and sell it before it is occupied.

Can I obtain more than one grant?

Yes, you can receive $10,000 for each new home that is purchased or built provided that the grant conditions are met.

Can I get the grant more than once for the same property?

Good effort, but Anna Bligh won’t let you this time. However, you could combine it with a $7,000 First Home Owner Grant and the first home buyer transfer duty concession if you meet the conditions.

When do I need to buy the home or start building?

A legally binding contract for the purchase of a new home or a comprehensive home building contact must be made between 1 August 2011 and 31 January 2012.

Owner builders must start the building work between 1 August 2011 and 31 January 2012. ‘Start’ of building means laying the foundation for the house.

Are there construction time limits if I’m building a new home?

Yes, for a comprehensive home building contract, the building work must start within 26 weeks of the date of the contract and finished within 18 months of the work starting.

For owner builders, you need to finish the work within 18 months of the work commencing.

For a contract to purchase a new home off the plan, the construction must be finished by 31 July 2013.

This is great! I want my $10,000 grant from Anna Bligh! How do I apply?

The Office of State Revenue (OSR) is currently making the application form and it will become available for you before 1 August 2011 on the OSR website (www.osr.qld.gov.au).

You mentioned earlier about a ‘Super Boost’ that is going to happen in Queensland. What is it?

The ‘Super Boost’ is the double kicker that is going to make the property market around places like the Sunshine Coast experience tremendous growth in demand. Here is the reason why.

Grants such as the Building Boost and First Home Owners create ‘demand clusters’ which brings forward the buying and construction activity that was likely to happen anyways. This means that once the grant ends the level of activity drops below what they were previously before the grant. The economic benefits are not long lasting.

However, some regions in QLD are in line for a second boost that is going to kick in at the same time the effects of the Building Boost wears off. What is this second boost? The Queensland government is undertaking several significant infrastructure projects in the Sunshine Coast over the next 48 months. The first one on the list is starting in October 2011. It is the construction of the $2 billion dollar University Hospital that is estimated to expand the local economy by 10-15%. This is significant since it would make Sunshine Coast the only non-mining community in all of Australia to experience growth of this magnitude. However, it is the timing of this project that makes it a ‘Super Boost’.

Even though the construction of the University Hospital is starting in 2 months, the real economic effect from the projects would not be felt until 2012. The effects of the Building Boost should start to flow to the economy in the latter part of 2011, and just when you think the effects are wearing off, the benefits from the hospital stimulus and other projects are going to start kicking in 2012. This ‘Super Boost’ will bring forward the growth phase of the Coast. When you combine these two stimulus with the other billions of dollars worth of projects that the QLD government will start within the next 5 years, you can understand why the team at Portfolios is so excited.

The Building Boost and infrastructure and building projects have now brewed up the perfect storm for the Queensland property market. If you can see this opportunity as clearly as we can, contact us at Portfolios to create your property investment strategies to take advantage of this upswing that you have been waiting for. Make sure you check out our top Queensland investment properties at www.portfoliosproperty.com.au and please call us to discuss your strategy in moving forward.

Have you ever wanted to have a high quality NSW property that is never to be repeated on deal and location?

Built right on the sand of a beautiful beach with uninterrupted views of the ocean.

The key benefits:

1. Priced at $199 000 inc GST , under current market valuation
2. A guaranteed nett rental return of 7% for the first 3 years with the first year rent paid upfront in full at settlement
3. No stamp duty payable under a current NSW government initiative
4. High depreciation benefits, now and ongoing, Year 1 is a forecast of $12 300 alone.
5. Has an independent body forecast for capital growth of 7.2 % for the next 5 years and the last 10 years historically 9%
6. An experienced owner operator that acts in your interests
7. Free complete furniture package
8. Positive cashflow up to $146 per week

View Property Now

You Will Need To Be Quick

We have been given the opportunity to make 30 of these properties available to you, but you have to jump at this.

It’s a case of first in best dressed because I am sending this to 24 000 people and after our newsletter late last week now only 24 remain.

One of the main reasons people fail to create wealth through property is procrastination.

Remember the best time to increase your property was 10 years ago, the next best time is now.

View Property Now

The Area

Birubi Beach in Port Stephens NSW is just over 2 hours drive from Sydney and 45 minutes from Newcastle.

A local experienced resort developer and operator is offering Portfolios Property some lots in their new and exciting development.

This property is offering a nett 7% rental return for the initial 3 years. The studio and dual key apartments current valuation is 5% over the contract price excluding furniture.

Overseas investors have already exchanged on 30% of this project.

The immediate area boasts 7 tour operators bringing over 800 tourists to the beach every week, this discounts the additional local tourist trade in the wider Port Stephens area. This resort development offers tourists a unique experience in accommodation, immediate coastal beach access, and of course a wide range of activities.

This adds up to a red hot real estate investment for you.

View Property Now

Other Information

Project is set to commence in March 2011 with completion expected May 2012. A Sunset clause is inplace for December 2012. Terms are 10% cash upfront with a FREE furniture package for the first 30 people.

You can download a Portfolios Property investors report on the Birubi Beach Resort or View Property now.

A more detailed development brochure will be posted here soon.

There are a limited number of these properties available and we’re telling over 30,000 people.

Don’t delay! Call Us NOW or visit our property website.

With Summer around the corner we start to think about our properties, the wild summer storms and dry heat bringing bush fires – summer is a volatile time for property investors.

But have we considered ourselves in the equation?

What would happen to your loved ones if you were no longer around to pay the bills?

I know it sounds morbid on this fine Spring day but the reality is these things happen, and quite often it is the family that is left holding the financial ball, so to speak.

This is where Portfolios can help.

Portfolios Plus provides the services of insurance professionals through our network of trusted providers.

Personal Insurance

Protecting yourself and your family is a vital part of a successful property investment strategy. If you were to suffer in an accident or be unable to repay your investment loans through disability or death would your family be able to support your portfolio?

What kind of legacy will you leave?

Protecting yourself is one of the greatest gifts you can give to your loved ones if you should be unable to support them.

Portfolios through our insurance providers can offer you one or all of the following insurance products:

• Life Insurance
• Accident Insurance
• Income Protection Insurance
• Temporary Or Permanent Disability

Insuring Your Portfolio

Whilst Portfolios does not provide insurance in this area we recommend you contact your property insurer to discuss a deal with them.

There are other forms, the important thing is to make sure you are covered.

A chat with a trusted Portfolios insurance advisor will ensure you are not in the dark.

Are You Wanting To Know More?

Expressing interest in insurance is simple, contact Portfolios today by downloading and filling out Insurance Signup Form and we will pass your details onto Peter Bentley, our trusted advisor, who will contact you in the coming days to discuss your requirements on behalf of Portfolios.

We are constantly being asked why we put so much of a focus on Queensland when there are great deals around the country in property investment.

At Portfolios we scour the entire Australian property investment market, and will be bringing other property opportunities from other states, but it is true, we have seen the most potential to date in Queensland.

In this article we will show you why Queensland show great potential in property investment and why we have chosen to offer such a large proportion of our property selection here.

Firstly you will you note that all Portfolios Property is measured against our strict property selection criteria. In selecting these properties only properties scoring more than 15 out of 20 even make our short list, with the majority of our offering being 18 or above. See our previous article on property selection.

When we show you Queensland’s benefits, perhaps you might ask yourself – when looking at your potential investment – whether the area you are investing in stacks up.

What About Queensland?

The real Gross Domestic Product growth in Queensland is the highest in the country. When placed on the international stage, GDP in Queensland even out performs global competitors like UK, USA and Japan. This is staggering for one state. Much of this is on the back of the resources sector but there is also heavy expenditure right across the state in infrastructure.

Following on from above, Queensland is home to the largest public infrastructure spending program in Australia’s history. You only have to take a drive through Brisbane to see the massive expenditure taking place, but outside of the metro areas ports, roads and rail are being constantly upgraded to meet the growing market.

Queensland is home to a growing young and entrepreneurial workforce fueled by numerous world-class educational institutions. In step with this is Australia’s fastest growing consumer market, being buoyed by the relatively young affluent population. Not to be outdone many parts of Queensland are experience growth in the retirement market with favourable climate and low cost of living.

In terms of trade and economy, Queensland has the 2nd highest number of international arrivals into Australia behind Sydney. The East Coast now known as Australia’s trade coast – connects Queensland to global markets (through many ports including Gladstone, Cairns) There are over 127,000 businesses and the number is growing daily.

Queensland has been ranked by KPMG as one of the world’s most cost-competitive locations. With the fastest growing population in Australia – major domestic inward migration – as well as from outside Australia, it is unlikely property prices will stop growing in the near future.

So there you have it – we believe Queensland is a great market for property investors.

Portfolios encourages you to consider your next investment in Queensland and as always are happy to discuss your unique requirements and investment strategy to help your investment property portfolio grow.

Ready Now Or Ready Later? What’s Your Preference?

This month we take a brief look at investment properties purchased off the plan and those that are turn-key.

Which is better? We take a look at the pros and cons of both.

With an off the plan investment property the purchaser is literally buying an apartment “off the plan” based on perhaps a completed prototype or even on the developers history in the development game. Usually the developer is required to sell a certain number of properties prior to the development commencing construction.

On the other hand a turn-key property is as the name implies,  a completed new property that is ready to “turn the key” and move in.

Off The Plan

So lets look at the pros and cons of off the plan first.

Pros:

• You secure a property at today’s prices with minimal initial cash in (sometimes as low as $1000) and dont have to worry about mortgage repayments for some time – or any other cost for that matter – BUT – you also dont have income from a tenant
• Depending on lead time (some as long as 18 months) you could experience substantial capital growth and sell for a profit at time of completion
• You can sometimes determine basic inclusions and colours – usually from a set range so you may have the opportunity to connect with the market better than your developer
• You are gurranteed the property will be brand new and fresh.

Cons:

• There is a risk that a decline in the property market could spell trouble for values and a drop in your LVR. You may not be able to finance the full loan at settlement.
• If property values have plateaued or fallen, the rental yeild of the property may also have fallen
• The developer is only as good as their last project – you need to be sure that the quality of construction and fitout will be in keeping with the price you are paying and the market your development will be aimed at. There have been reports of developers changing fit out at the last moment to cut costs.
• Buying off the plan can be difficult for someone who does not visualise well – being clear on what you are getting, sense of space and functionality will be important.
• You could start paying your mortgage long before a tenant moves in – sometimes the builders work on a progressive scale of work completion – particularly if you are building a house for investment. You could be paying your mortgage months before a tenant moves in, particularly if a hefty deposit is required.

Turn Key

Turn key properties are ready to be tenanted immediately. You will notice that properties listed by Portfolios Property are always turnkey, we want people to being their investment journey today.

Pros:

• You can start your investment cycle almost immediately. Once you have settled you can start earning money from tenants. To get the first tenants in we advise you to work with local agents during the exchange phase to ensure a tenant is ready when the mortgage repayments start.
• Turn key properties in many states attract stamp duty concessions – you need to check in your local state – stamp duty concessions can wipe thousands off the purchase costs.
• You can see what you are getting in terms of investment – you can go through the normal process of getting a building inspections and of course take advantage of the maintenance period of the new property from the builder.

There are not a lot of cons with the turn key option – specifically related to turn key – at the end of the day you get to choose the property that best suits your situation and market and with the assistance of Portfolios can even look at how the investment plays out over the coming years.

We look forward to being able to work with you to make property investment happen.

You’ve watched the lifestyle shows, dreamed of buying the do-upable dump and making a good return out of it.

All over the world people take on projects to renovate and make money from property. It is contagious, both challenging and rewarding.

But what happened to making the dream a reality?

Portfolios is proud to be associated with Cherie Barber and Stephen Tolle and the Renovating For Profit team. It is a unique community of people that buy houses, do them up, and sell them – for a living. The amazing thing about this community is it is made up of ordinary Australians like you and me. There are some who wouldn’t dare put a lick of paint on a wall or pretend to be the carpet layer, tiler, sparky and plumber all in one.

In fact most of these people are simply great project managers, I will come back to that later.

Renovating property is a rewarding experience that, given the right tools, structure, strategy and financial platform, will give you a very fulfilling career or some extra income.

I personally complete 2 -3 projects per year, look after the Portfolios group businesses and along with meeting our wonderful clients that is my plan. Business will give you a lifestyle, your deals will give you your financial wealth.

So how can I help?

When looking into renovation project there are plenty of aspects to consider.

The main 3 are: Structure, Strategy and Finance, other fine print considerations for you could be:

1. What is your exit strategy?

Are you going to renovate and hold or renovate and sell?

Always be prepared when you have to hang onto the property that you have the capacity to hold via income or equity.

2. What is your costs and profit margin?

Understand the kind of gains you can make and manage your improvements accordingly. Knowing your numbers for buy, renovation and end sales price are critical to success.

3. What improvements/ works do you need to make?

Are you just making cosmetic changes or major structrual or even extending the property?

Firstly make sure you can make the changes you want to – check with council and look at similar properties.

Your due diligence is your chosen area will make sure you know what is desired and the end sale price for delivering that to the market.

As you make more an more deals this job will get easier because you will be able to estimate better yourself. But in the mean time surround yourself with professionals. Dont be afraid you will be helping their businesses too.

4. What is your contingency?

I see too many developers, renovators and property investors that come in with a conservative estimate on improvement works and do not consider an contingencies.

Lets face it there are many and varied factors to property projects, allow in your plan to cater for these.

5. Become A Project Manager

Project management 101 – manage your project closely – watch your progress, scope and budgets.

Timing is also critical so use a program to manage day to day activities who is where when – what needs to be completed to allow other works to take place on site. And like your contingency build buffers into your program – rain delays, holidays, slack contractors.

6.  With each deal it gets easier

When I started out – like all of us – I made mistakes but in each case I have learnt far more from them,now I have the privilege of helping people avoid the mistakes I made, saving them valuable time and money.

There are aspects of this business that you will always rely on others to solve for you but increasingly you will be able to take on aspects of the deal yourself based on your growing knowledge – you will become more astute and will see potential everywhere.

Financing The Deal

So the deal looks good and you have done your due diligence, what now.

Make the time to work with the Portfolios Team on your plan, whats possible, the project, structure, strategy and then we can work on finance options.

We can even show you strategies how to finance the deal using other people’s money and time.

First things first complete our Portfolio Review and we will work with you through the steps to becoming that Professional Property person.

Make It Happen – you’ll love it.

Paul Pritchett

A Never to be repeated bargain! Contract has crashed, and YOU are the winner!!

One Only House/Land package in town of Chinchilla for just $375K with Ducted Aircon.

Call Keiran at Portfolios Property for details on 0447 255550

$1000 *refundable EOI, will secure this for you TODAY! This wont last!!

Find out more about this deal…

At Portfolios we have profiled Chinchilla a number of times previously in this broadcast and have profiled it on our property website.

We believe that Chinchilla is a fantastic investment property opportunity and having only a one property left at this fantastic price it will be a shame to miss out.

Chinchilla is located in the Darling Downs 250 Km NW of Brisbane. It is a popular tree change destination. With an historical capital growth of 14% and rental yield 6.6% with vacancy under 1.0 the stats really hold up for this property. If you earn in the 40% tax bracket – this property could be yours from just $43 per week.

Strong population growth continues throughout the region alongside ever increasing job opportunities and tightening rental availability has driven up rents sharply.

The town has a great community spirit and has hospitals, schools and many ammenities of normally much larger towns.

Over $10 Billion dollars is currently being spent on Coal mines, Gas pipe line, Rail line linking rural Qld, gas exploration & waste water purification.

You can find out more about Chinchilla here but we suggest you dont delay to get this great price.

With the average loan for an investment property being refinanced every three years it is little wonder the banks have introduced fees to make you think twice about moving away from them.

Loan exit fees have become common place in the mortgage market. Today very few banks provide loans without them. But it hasn’t always been the case.

Lenders exit fees serve to discourage people from refinancing to other banks – or even with the same bank. They are designed to keep customers as long as the bank can.

The challenge for banks is that most home loans do not make as much profitability in the first few years as they do in the ensuing years. Banks need to recoup profit if the customer chooses to exit early.

Fees can range from $400, an average of major lenders around the $750-$1000 mark with non-bank lenders charging a percentage to exit of around up to 2.5%.

Whilst we dont necessarily agree with these exit fees it is something we have work with developing your strategy.

What you need to understand is your strategy affects the loan options and it is far more than just the interest rate.

At Portfolios we understand all consideration of your deal and the associated loan/s which is why we aim to offer up to three loan options into your strategy each with its own profile and considerations. Make sure you take the time to review and discuss.

For example if you are purchasing to renovate and sell  quickly  then we will offer up to 3 loans that typically would have  lower exit fees for great profitability in your deal.

However if your strategy is to buy and hold the property then the early exit fees are not so much of a consideration.

Portfolios will work with you to develop the right strategy that includes Structure, Strategy, the Property and Finance.

If you wish to look at your options and get started complete our FREE Portfolio Review and we will be in contact with you shortly.

Portfolios looks forward to working with you to …Make it Happen.