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  1. #1
    Join Date
    Mar 2006
    Location
    Auckland
    Posts
    223

    Default First trade settled yesterday :)

    And how nice it was to see some didgets in the 000's column of my bank acct!

    Saw a 3 bed crosslease do-up in Manurewa listed online asking 195k, called first thing next morning but it already had a contract for $182,500. Put a backup offer for the same price and 4 weeks settlement. Amazingly the first contract fell thru on finance so we got the great price they had managed to negotiate, effectively for us!

    Listed on trade me for $99, got a call that evening from a gentleman wishing to view, had a contract later that night for $193,000 double settlement. Net profit approx. 9k! Not big money for sure, but it was the easiest money I've made (actually no, teaching English in Japan was the easiest money I've ever made, hoho~) and besides, I couldn't be bothered holding out for a higher offer, or renovating it for the sake of an extra 5k. Left that for the person buying it off me. Win-win I think!

    Got my next one in Henderson lined up already, 3 bed at nice price with settlement in March, just need to tidy the grounds. Should be able to get more from this with the good weather I think.

    Its all good, haha~
    payji-san dayo, SAN! sonkei shiro!

  2. #2
    Join Date
    Jul 2005
    Posts
    1,156

    Default

    Well done, congratulations!
    If you don't mind me asking, have you done it in your name or used a specialised entity?

  3. #3
    Join Date
    Jan 2004
    Location
    Whangarei
    Posts
    5,867

    Default

    That's interesting, thanks for posting!

    I was wondering how much margin other traders require for trades that they do nothing to?

  4. #4
    Join Date
    Mar 2006
    Location
    Auckland
    Posts
    223

    Default

    Thanks, actually Ivanhoe I was in the process of setting up a trading trust when this deal came along so it was risk putting it in my own name or letting it go. As this is my first property transaction and I now have a structure within which to operate properly from now on, I think I should be ok IRD wise.
    payji-san dayo, SAN! sonkei shiro!

  5. #5
    Join Date
    Aug 2006
    Location
    Hamilton
    Posts
    24

    Default Well done on your first trade

    just keep in mind for your next one the costs that eat into your net profit, on your 9k your going to have legal in and out, same day settlement means your going to avoid holding & insurance costs, but next time, if you set up a trading trust as I presume you will you'll also have GST to pay on sale as well.
    Keep up the good work, always like to see success stories

  6. #6
    Join Date
    Jul 2005
    Posts
    1,156

    Default

    good on you mate, keep it up!

  7. #7
    Join Date
    Oct 2006
    Location
    Auckland
    Posts
    570

    Default

    Payjisan,

    Awesome, you have done the coarse, used what you learnt and more importantly as Dean always says, you took ACTION!!!

    Good stuff, cant wait to hear of the next.

    I like it when class mates are doing well, it gets the rest of us to take more action.

    FH

  8. #8
    Join Date
    Jul 2005
    Posts
    1,156

    Default

    You know that i'm an "aye-sayer" but in cases like this one so far risk is too high for me. You are still liable if ultimate buyer fails to settle so the flow of deposits should be arranged properly and also tax issues - nothing wrong in paying tax, but after solicitor IN/OUT fee (less GST, sure!) profit on 5k is marginal compared to your risk exposure - IMHO.
    I don't think ALL of the aspects of assignments and double settlement are covered in any book or course (especially legal consequences of left field events).
    Looking forward to do Dean's trading course - should open this direction for me again!
    Repeat after me: "my trades are risk free!", "my trades are risk free!", "my trades are risk free!", "my trades are risk free!", "my trades are risk free!"
    Last edited by Ivanhoe; 06-12-2006 at 08:18 AM.

  9. #9
    Join Date
    Jan 2004
    Location
    Whangarei
    Posts
    5,867

    Default

    Ivanhoe,

    That's exactly what I was thinking and the reason I asked what other traders accept as a minimum margin... this one seems very slim.

  10. #10
    Join Date
    Mar 2006
    Location
    Auckland
    Posts
    223

    Default

    ARV was around 210 - 215k but was only asking 199k for a quick sale. Could have got more than the 193k I'm sure but didnt want to be greedy really for my 1st attempt... Since then I have determined 15k gross profit as the minimum required in the final sale price on any trades. Any less then will look into assigning to a purchaser for 5k or so.
    payji-san dayo, SAN! sonkei shiro!


 

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