$100,000 equity to play with but hubby says WAIT!

[SuperDad]

Once you hear that it has been accepted, will you share a few details?

It is always interesting to hear the nitty gritty details of what others are doing.

Paul.

[MarniH]

I absolutely might, or I might just wait until it's unconditional. I will however share as soon as I can.

[SuperDad]

One of the advantages on posting a few details before it goes unconditional is that others might have a few suggestions, or spot something you didn't spot.

I did this with my first deal, back in mid 2006, and got a huge ammount of helpful feedback.

Paul.

[MarniH]

And the phone call came in! It's ours, and I just bought a property for $100,000 under the govt valuation!!! All I can say right now, but WOWEE!!!!!!

[SuperDad]

Wow!

That sounds good.

Paul.

[MarniH]

Hi Paul

Yes, I think it is good. Now we have to go look at the property we just bought *grin*

I was just one of those deals you couldn't muck around on, there was someone else looking through it at lunchtime today, so we had to get our offer in and get it accepted before that time. We have a finance clause so we are covered if we do need to pull out. But I don't think we'll have to.

It's a two bedroom serviced apartment in the centre of Christchurch.

[Gerrard]

And the phone call came in! It's ours, and I just bought a property for $100,000 under the govt valuation!!! All I can say right now, but WOWEE!!!!!!

Hi MarniH - I'll get in before Xris does and ask how you know this is such a good deal? I've seen plenty of places with overinflated GVs so do you have something else (e.g. a registered valuation or recent comparable sales) to back up its true worth?

Gerrard

[SuperDad]

While we are playing "beat xris to the punch", I'll add that a finance clause is not a general out clause.

Paul.

[tricky]

I was just one of those deals you couldn't muck around on, there was someone else looking through it at lunchtime today, so we had to get our offer in and get it accepted before that time. We have a finance clause so we are covered if we do need to pull out. But I don't think we'll have to.

It's a two bedroom serviced apartment in the centre of Christchurch.

Hi MarniH,
Well done in moving fast.
Any chance of some figures (price, returns, yield) to see what has got you excited?
Is it a good cashflow investment?

[MarniH]

Oooh Mr Negativities.....How bout, just a well done on a great deal? I am getting a registered valuation done on the 14th, and if it doesn't stack up the bank isn't going to back it, so yeah, I do have an out clause. Tricky, thanks for being the only positive person on this page! Even on 100% finance (no money down) it's well and truly cash flow positive.

[Wayne]

It's a two bedroom serviced apartment in the centre of Christchurch.

A 2 beddy in Chch for $100k under GV - must be a massive discount (% wise)or a really high class, expensive apartment.

[Davo36]

A serviced apartment that you bought without seeing? I hate to sound negative too but you might be lucky with this buy, but you might also be unlucky.

And luck shouldn't really be playing a part (although we all have some good and bad luck). This is more speculation than investment.

I would suggest you need to have a very thorough look at this opportunity. Especially the GST issues.

RE the out clause you think you have, read the thread here called 'The Safest Out'.

David

[Wayne]

negative?

remember that what may just seem like negative comments are really opportunities to learn. Just because a person doesn't share your enthusiasim (sic) doesn't mean that they are negative or wrong. Some of the best learnings come from the challanges that people Davo36 make.

[Davo36]

Thanks Wayne.

MarniH, I don't want to sound like "You don't know what youre doing or you're going to come a croppa". I really just wanted to say that you need to really look at this deal hard now.

Signing up something without seeing it because you reckon someone else may have snapped it up is one thing. OK, you've done your little risky bit. Now it's time to have a really good honest look at the deal and if it's no good, walk away. Look for another. There will be heaps more of these sorts of deals availabe shortly I reckon.

IMHO the best business people definitely take some risk BUT they do everything humanly possible to mitigate that risk. And then they only take the risk if there's a good upside.

What do you believe the upside for you is MarniH? Do you think it's worth a fair bit more than you've signed it up for?

Are you absolutely sure it's cashflow positive? You will need to look at all the figures yourself. Figures supplied by agents and vendors are often wrong. I would want proof of the rental being paid and the outgoings that need to come out of that.

David

[MarniH]

Well, I guess time will tell, and one of two things will happen. I'll either be dancing on the ceiling or running away with my tail between my legs....Either way there's really only one thing I can say....WHAT A RIDE!!!!!