STEP NUMBER SIX – CLOSER TO MY HOME.
The Gold Coast has lots of very pleasing areas in which to live, such as Elanora which is two to three kilometres inland from Palm Beach. It was here my wife found a very interesting two bedroom unit in a block of three. It has a small garden area in a courtyard, is built on stumps rather than a slab, and has high cathedral ceilings which give a lovely feeling of spaciousness,
and above average size rooms. To cap it off, there is a garage with a tilting door, the block is on a cul-de-sac, it has small views [ PEEPS ] of a local man made lake, and it’s ten minutes from home. Just about a perfect investment unit, I thought. As previously mentioned, the owner was a bit difficult to deal with and kept changing his mind about the deal, but Joe the agent was very definite on my behalf, and it went through.
DAVID THE FINANCE DEAL MAKER.
As I’d come to expect, David worked out a deal where we were able to extract lots of equity from both Mt Isa and Geraldton, and my out of pocket expenses for the purchase were minimal. Interest rates were on the rise and were tipped to go to at least 10 % over the next couple of years – which they did – so it was decided to fix the rate at 6.8 % for five years. There are many varied opinions regarding fixed versus variable interest rates, and the reasoning for us fixing the rate was that the other two were variable, so what was lost on one may be gained on another. It has turned out to be a good decision for most of the four years which have elapsed, with the exception of the last few months when the variable rate decreased to 5.04 % for a while. It’s now 6.1 % [ January 2010 ] and may increase – Please Mr Reserve Bank, not too far.! It was my introduction to ………Which Bank ? 
SADIE – I MEAN HARRY, THE CLEANING PERSON .
The owner had inherited the unit and I doubt he had heard of the word cleaning. To be honest, it was a serious mess, but, undaunted, I rolled up my sleeves and with family help had it sparkling and hygenic in a matter of days. My mentor always insisted on a complete change of locks when buying a house or unit, so the property manager to whom I’d given it to manage had a list of reliable tradespeople including Dave the locksmith. He suggested that we change all the internals/ barrels so a common key would operate each lock. Worked really well. We washed all the curtains, fitted new venetian blinds, had my sparkie mate Brian fit a new switchboard and safety switch, and all was ready to go.
TIP. Property managers seem to have a group of reliable trades and service people at their fingertips because tenants deserve to have rapid response when there is an emergency. If you are in need of a ” good reliable tradie ” I can highly reccommend you call your local real estate agent’s property manager and ask for help. It’s been my experience that they are always willing to share their tradespeople.
TENANTS – BLESS THEM !
I have been blessed with some really high quality tenants at Elanora, and have not have a repeat of The Tenants From Hell episode at Geraldton. Changed my ” families only rule ” and had a couple, a single lady, a single mother with one child and a dog, and a second single lady. Our local LJH real estate office has a rigorous screening procedure in place, and it pays huge dividends. As mentioned previously, the relationship between tenants and landlords is one of mutual interest. Or a symbiotic one. A proven fact is if the landlord takes care of the tenants, they will take care of the property.
REVIEWING MY PROGRESS – Under the Microscope
It’s interesting looking back on this the Sixth Step and the previous Five. The very expensive 2 day seminar I attended was in late 2003 and I must confess, like Sergeant Schultz in the Hogans Heroes TV show, ” I KNEW NOTHING ! “ of any consequence about investing in real estate / property. What a journey ! And there is more to come as I have realised the majority of people who invest, buy only one or two dwellings. The goal I set after the seminar was to create a portfolio of 8 – 10 properties to generate a substantial income and security for our family. Mt Isa settled in October 2004 and in five years it is worth at least two and a half times what it cost. Love the capital gain. More to come on Seventh Step as I return to the mining towns, and buy the so far, least clever, house. It looks as though the 10 foot long Baldwin, Steinway, Bosendorfer or Yamaha Concert Grand piano will have to wait a while…………..
ACCENTUATE THE POSITIVE !
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