Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got to talking about investment and money. I started investing with $150k and in the first 2 months, my portfolio was reading $274,800. Crazy right!, I decided to reinvest my profit and get more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.
Hi. I’ve been forced to find additional sources of income as I got retrenched. I barely have time to continue trading and watch my investments since I had my second child. Do you think I should take a break for a while from the market and focus on other things or return whenever I have free time or is it a continuous process? Thanks
@@israel-r7 However, if you do not have access to a professional like Clementina Abate Russo, quitting your job to focus on trading may not be the best approach. It is important to consider all options and seek guidance from reliable sources before making any major decisions. Consulting with an AI or using automated trading systems can also be helpful in managing investments while balancing other commitments.
I'm 54 and my wife and I are VERY worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, and we are finding it impossible to replace them. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 30 years nonstop just for a crooked system to take all you worked for...
I feel your pain mate, as a fellow retiree, I’d suggest you look into passive index fund investing and learn some more. For me, I had my share of ups and downs when I first started looking for a consistent passive income so I hired an expert advisor for aid, and following her advice, I poured $30k in value stocks and digital assets, Up to 200k so far and pretty sure I'm ready for whatever comes.
@WilliamEthan00 Nah I Can't say I can relate, Alice Marie Coraggio charge is one-off and pretty reasonable when compared to what I benefit in returns...
There is borrowing capacity, I bought two properties and after that banks are not giving me any more , Dilleen is working as property agent and making money from clients adding to his borrowing capacity. You need to have high and more income to continue getting additional loans
@@gun30tyou’re going to try and make tongue in cheek comments because someone put their balls on the line and worked hard to save for a deposit. 2 properties but probably up to their necks in debt, you know nothing about how stressful this financial burden can be.
It's important to be flexible and adaptable in business, especially when unexpected changes occur. In this case, it would be wise to reassess the plan and make adjustments to account for the increased rate rises and potential impact on cash flow.
This is extremely simplified, some lenders won’t let you access your equity depending on your servicing capacity, I literally just had this happen to me even though my salary is $200k+ the lender wouldn’t factor in my overtime and would only take into account my base rate, have $200k+ in equity and couldn’t even access $100k it’s far from this simple.
Let me explain something to ALL OF YOU complaining about borrowing capacity. 1. This is EXTREMELY difficult, but not impossible. I would give this plan in this video a success rate of 1% if that. 2. Banks do not consider property equity (how many properties you own) when it comes to borrowing capacity. They care about your INCOME, meaning you can own 10 homes but if you make $1K a from a job, good luck getting even ONE mortgage. 3. Oh, what about rental income? Banks ALSO do NOT consider rental income as an income to increase your borrowing capacity, as they know you can lose tenants, hence, lose rental income at any given unpredictable moment. There is, however, a way to increase borrowing capacity through rentals. THIS IS HOW: You set up a corporation or LLC or whatever it’s called in your country, receive the rental income through that corporation, and have that corporation HIRE YOU as a PERMANENT EMPLOYEE, with a labor contract, pay stub, social security, employment letter, etc. This WILL BE considered by banks at the time of calculating your borrowing capacity. Furthermore, you will have to do this for at least 2-3 years before any bank will consider this corporation or company as a feasible credit subject (a stable business). You’re welcome.
Hey! thinking of implementing this strategy. Could you do another video elaborating on the banking/borrowing side of things? Thins such as: What are the ranges of loans from banks regarding income? - Do banks see overleverage with buying so fast? - What do banks require and the overall time between loans? Thanks in advance
This method is basically out the window now mortgage rates have gone up, best way to make this work is wait for the inevitable slump/crash in house prices and get in then and hope the boe has to drop rates right back down due to the destruction they cause in the economy by trying to fight inflation.
Sounds good on paper. One more issue to consider is the Transaction costs are roughly around 5% give or take and one maintenance or bad tenant could make a positive CF a negative one. So in your example 300k with stamp duty and other expenses will require another 15k and with 90% one may also have to consider LMI which may be another cost to add.
I lost over $80k when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I found one source to recover my money, at least $10k profits weekly. Thanks Kimberly Ann Doran.
Wow. I'm a bit perplexed seeing her been mentioned here also Didn’t know she has been good to so many people too this is wonderful, I'm in my fifth trade with her and it has been super.
Thanks for the video Eddie. My concern would be that if you have used equity on a property could the bank then margin call you if the property price reduces? It seems likely that property prices will drop 15-20% in 2023/2024. This along with interest rates possibly exceeding the yield (possibly getting as high as 7%) makes this aggressive style of investing seem very risky to me. What will you do if the above does happen?
No one ever explains borrowing capacity limitations in these examples. Unless making 200k a year, you’re not getting 1.2million dollars worth of debt in 8 months (for he first 4 properties). Can you explain how to get over his hurdle?
No, not the way banks assess rental income and the timeline you need to meet their requirements. Banks assess rental income at 70% or 80% of net, and to then get a property to 20% yield on debt you're waiting for a few years. So this doesn't answer the question of buying 10 properties in 3 years. Even if they all make $500 a month net profit, the bank won't loan you anything beyond your first 3 or 4, simply because the way they assess you will actually be running at a loss, because they're hyper conservative. You would need something like 60% LVR across your entire portfolio for your rental income to even come out neutral based on a banks assessment model. Unless you're coming in with huge deposits, you're not getting to 60%LVR inside 3 years on even 1 property. So it doesn't make sense that you can buy 10 in 3 years unless you're solving that borrowing capacity problem. I've bought 2 properties, with a total portfolio value of around $1mil, in 3 years, and I have an average LVR today of 70%-75%. And that was in the extreme conditions of Covid during that huge growth period. Both my properties are also positively geared by about $500 a month each. In normal circumstances, that ain't happening. I appreciate the reply, but it's incorrect haha. Do you have rental properties? This is something you would know if you do..
BANKS. DO. NOT. LOAN. OUT. MONEY. LIKE. THAT. It's largely based on your income. You need to be a very high income earner if you want a bank to hand you that many individual home loans. Not to mention your plan involves landing "3 pointers" repeatedly and if you miss just one, the house of cards falls apart. Forward thinking and proactive planning leads to success... but this video is pie-in-the-sky stuff.
@@Will-yr3zt oh stop it. Deposits range from 5 to 20 percent of purchase price. 5k to 60k just like he said in this video. Please use logic and math before rattling off false information. If you make 40k at one job and 20k at the other it would take roughly 3 months to 2 years by yourself. With a significant other it would take way less time. Oh. And there is deposit assistance programs that will just give you 10k to 40k. Then there is NACA that will give you a mortgage for a quadplex with no money down at all with a less than market rate interest rate. If there’s a will then there is a way. Not trying to be rude, but people that think like you water a lifetime wishing you could out even becoming bitter over the years. Just know you can and find a way.
The more cash flowing properties you get, the more your income increases. Even with the first multifamily property, banks consider you potential rental income as income for approval purposes.
Using equity is easy, it's the borrowing cap that is hard. Good luck servicing 10 rental purchases on standard 2x family income. Most will cap out at 2x rentals and an Oo property max
Yep you’re gonna have very low equity in every property (risky when things turn) and assuming you’ll buy 10 consecutive properties for 10% ‘under market value’ in a row is easier said than done This strategy can be done but the above example is using very favourable circumstances across the board
Can someone explain this? 06:00 I still don't get it. You get house re-evaluated at 360k, and you take 320k (90%) as a loan instead of your original 270k You take an extra 50k in loans? So you go 50k deeper into mortgage? How do you get that 50k in your pocket?
Great explanation 12:20 seconds that you have worked your arse off for the deposits. I was thinking, how come you can buy only with the equity as bank will think the loan is not serviceable if you do not have job. Great strategy Eddie.
Hi Eddie, thanks for the video. By taking equity out of the properties, that means you will have more debt on that property, and reduces your cash flow for that property. On top of that, there are the new loans for the new properties. How do you actually pay for all the mortgage payments? And when do you actually start to have a high cash flow from this strategy? Thank you.
the new loans should be covered by tenants if you do your numbers right and are positive or neutral geared. All investment properties ideally should be on Interest only for 5 year periods to start. That reduces costs and increases cashflow while building equity.
Thanks for the content, I’m just starting to look for buying and investing into properties and this gave me an great perspective on what to do and look for
The strategy is good. However, what is your income that allows you to borrow these loans from the bank? What if all the houses were not rented out for what ever reason? You would need to service all the loans? I’m always baffled because the banks always seem to tell me that I cannot loan any more?
Your right, his strategy is not feasible. He saying as if the bank will lend you all the money with income even under $50,000 a year @@. You must be earning more than at least $300,000 a year to adopt his strategy
Go to a broker, the bank wants to see you run it as a business. You best bet is multi accommodation if you can get 4 rooms or that's 10 to 15% rental return. The more immigrants come in the easier this will be the less strick the laws will be
Mate with all due respect what are your maintenance costs on your 40 properties do you sleep at night and if you do you must have the world's greatest tenant's and the cheapest trade's people in the market 😉
Great channel 👍I like investing on ETF but I like houses... I had nvestment properties but it was in Japan..now I want to buy the investment properties in Australia with my kids! Different systems but Australia is easier to start the investment than Japan if people know how to do it. Also Australia is a great country as population is always growing so rental property is always in high demand! Thanks for sharing your experience. Ill use your videos to educate my kids.
you know what they say ,it takes a village to raise a child .but i think that applies to everyone ,not just kids .we all need a community to support us , to help grow , and to learn from each other . i truly believe that community is one of the most valuable things in life
They have an extensive library of articles and videos on personal finance and investing topics. They also offer live webinars and Q&A sessions with financial experts. And of course, there's the community forum where members can ask questions, share their experiences, and learn from each other
Wow, that sounds like exactly what I need. I've always felt intimidated by the world of investing, but having a supportive community to learn from would definitely make it less daunting. How do I join?
You just explained why Chinese and Vietnamese own so much property. Regardless of the relationship with family they always pull together to buy into a property or business, Aussies aren't as resourceful and are lazy and spoilt , to further confirm my statement you will hear Aussies complain about Asians buying all the properties but fail to admit that the obvious reason for this is that they work hard and save and band together because generational wealth is paramount for the longevity of the family generations to come , they do it legitimately and legally most the time too. The first gen of the Family knows and accepts the honour of dedicating their lives to work and gaining wealth so their following family members don't have to suffer,
I have $200K in my bank account but no confident to invest on RE. I'm still dumb on investing, scared of losing my money. I need proven success before I embark on this journey.
Thanks for the video - A question : you talk about financing 90% but we also need to pay our monthly installments but the amount that we get from the rentals is not sufficient to pay off the monthly loan installments so we end up paying additional every month from our own equity. How will you work this out?
Pretty bad assumptions that house increases so much and the banks are not that keen on 90% refinancing for investment. Generally they look that paid the house down to 80% of the value is zero equity.
How did you go from a 50k deposit of 300k to borrowing 270k isn't it 250k. Finally someone explaining how you beat the borrowing capacity issue 🎉. Just have to pay a higher interest rate with lower tier lenders
I'm going to assume that $300k for an investment property that has "strong cashflow, metropolitan based and good capital growth potential" is just an arbitrary number right? Because trying to find a home that fits that criteria under $300k is damn near impossible. Which makes me think that this entire strategy and timeframe is completely unachievable..
Hi there, we are still buying properties for as little as 200k - 250k in the current market. You just have to know where to look + it helps getting access to urgent sales that are typically discounted already!
Thanks for the video. I want to get started very soon and would like a 10 year exit strategy. What do you think about apartments in small blocks that are easily renovated. I'm handy with the tools.
Great video. Really got me thinking. That's a lot of debt to accumulate, tho. At what point would you hit the breaks and sell like 3 or 4 of them with the growth and try and bring the loan down a bit? Then you could clear all of it even if you just got too keep two(ideally) and then restart the cycle to mitigate the risk.
Problem is you can't buy a property in Brisbane for $300k it would be rat infested shoebox in Inala... and wouldn't be able to charge anywhere near $400 a week rent to be positively geared. Destroys the entire framework of the strategy.
Hi James, We find plenty of properties around the 300k mark in metro Brisbane that are of good quality and low maintenance, additionally the rental yields are strong - minimum 5%. If you'd like to see this, check out our instagram for example of properties we help clients purchase :)
What happens is for next property bank considers rent as your income That is why if you are low earner first 2 property should be positive cash flow The problem usually start from property 2 onward as banks considerc%80 of rent as income oppose to payg which is %100
im on 60k a year after tax, i have a property with about 150k equity, if i move back with my parents and save and use equity could i buy 2 properties within 1 year? no kids no mrs im 41. seems like im in a good position going off this? should i aim higher? i could stay with the olds for max 3 years
@@eddiedilleen_ I have one more question, I’m about to buy my first property with first home buyers guarantee. Would it be more wise to get the most expensive property I can, considering I won’t have to pay stamp duty / LMI or buy something cheaper that will have positive cash flow? I’m thinking cash flow but would like to hear it from someone with experience. Thanks
People are forgetting property that’s an investment or whatever you gotta be insured but I have rates paid all strata might have tenants that going to hardship and can’t pay or won’t pay for damage stuff unless you got a reasonable salary I wouldn’t suggest to get into this it’s just from my experience I went for a job that I was earning 70,000 of the space of 2 to 3 years I was only earning 45,000 interest rates go up to take into consideration all the sort of factors so have the multiple properties they will need multiple insurances this bloke should put your towards the insurances who is the best insurer for all your properties it’s not as clear cut as what display is making it so be aware
Good strategy, BUT, you start off with a loan of 270k and after pulling out another 50k for the next deposit you owe the bank 320k, thats hundreds per month is repayments. So it only works if you're getting excellent rental returns, otherwise your ability to make those repayments is eliminated.
Yes, the strategy we follow is by obtaining properties that are below market value, with strong rental returns, and growth locations in metro capital city areas. We focus on yields in the current market between 5% - 9% so most of the time this will be neutral, slightly positive, or worst case slightly negative - but manageable. The goal is to have the property servicing itself :)
i am based in Sydney looking to buy my first property in Australia. let’s say the market is more favorable in a different state. when you first started to buy outside NSW, did you always go to inspect the property before signing your investments?
This strategy is just before interest rate goes high like nowadays. How you survive with high interest rate?? You could increase rent but what if you cant increase rent as much as increased price by increased interest rate ?? Any idea ? I would like to analyze worst scenario which can occur to anyone who can see your video
I read your book, but the only issue here is that the property isn't 300k in Australian metro areas anymore. Unless you can give me an example? The math makes sense but you are looking at the 600k mark.
Hey Ryan, it certainly is still possible in today's market. We are currently sourcing between 200k - 700k. You can check out our instagram/fb for some of our property purchase examples if you like :) For more info on what we do you can email my team here: admin@dilleenpg.com
Why did you choose not to buy quads with 100k though? Any reason? I’m really interested because I am actively searching for a quadplex. I would like to know if there’s something i should be aware of. Thank you in advance.
❤️🙏🧿 Sounds good. But finding those properties is the hard part. And buyers agents want 10k to 15k to find a property 🤯😱... 10 properties that's 150k just to buyers agents. In the USA it's only 2k to 5k to buyers agents which makes more value sense 🤔 ❤️🙏🧿
Hey there, definitely understand where you are coming from, but there's another way to look at this... As an example, our buyers agency sources properties for clients that are 10%-25% below market value. This essentially means you are making money on the way into the property purchase. (e.g. purchase a property for 425k but it's value is 500k) If you were to source properties by yourself, you may not be able to access properties that are below market value, you would most likely be paying market value or more. The fees paid to use a service like this are minute compared to the money made/equity gained going into the deal. Hope this helps :)
@@prospectus2011 Greedy people and nothing else. There is nothing that a buyers agent does that warrants 15k price. I would love to see there break down of the hours they put into their work for each client to prove the 15k price. The words Below Market Value is a joke. The price something is sold IS the market value. Its in the words "Market Value", which mean that`s what the Market would pay for it. Advertised value or Recommended Value or Median Value is different. Remember they sell their service with Zero guarantees but somehow want 15k. * Do they have a place in the market, yes they do. But not at 15K. In the USA they charge 2k for basic service and 5k for Top service which is more reasonable.....
This strategy can still be applied in todays market yes. However properties with positive cash flow can be more difficult to come by, they may be slight positive, neutral or slightly negative geared. The main point to focus on is buying below market value :)
Your theory is built on the scenario of properties in the 400k mark which are diminishing currently. Also you are forgetting the most important component of borrowing capacity. No bank will give one person all these loans
Good to diversify between Townhouses, Units, Duplexes and Houses. It comes down to the number at the end of the day when choosing a good property deal, not so much the property type.
When sellers have a time constraint to sell for urgent reasons they are usually willing to sell for a lower price point to quickly offload the property. That's where Eddie comes in, as he has good industry connections with real estate agents and bank administrators, he can get access to these kinds of deals when they come about :)
We have been getting great deals between 200k-700k in Metro Bris and Adelaide with around 5.5% - 9% yields. Take a look at our Instagram or Facebook for our recent properties sourced for clients :) @dilleenpropertyau on Instagram.
Commbank want me to keep 20% equity in my property, so then I could use anything over that to buy another property.... Which bank/broker lets you keep just 10% equity in your property?
Servicing can get tricky in times like this when rates are up, sometimes it's a waiting game, or you may need to find ways to increase your income, reduce your expenses and reduce your liabilities. It's also important to have a good mortgage broker with investment experience as they can come up with alternative options for you/have access to banks with less strict policies
which bank would let u cashout for 90% property value after refinancing? I could only pull out 80% of my first. Theres hardly anything for single house at 300k range within those 3 states u mentioned about. 😂
Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got to talking about investment and money. I started investing with $150k and in the first 2 months, my portfolio was reading $274,800. Crazy right!, I decided to reinvest my profit and get more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.
Hi. I’ve been forced to find additional sources of income as I got retrenched. I barely have time to continue trading and watch my investments since I had my second child. Do you think I should take a break for a while from the market and focus on other things or return whenever I have free time or is it a continuous process? Thanks
@@israel-r7 However, if you do not have access to a professional like Clementina Abate Russo, quitting your job to focus on trading may not be the best approach. It is important to consider all options and seek guidance from reliable sources before making any major decisions. Consulting with an AI or using automated trading systems can also be helpful in managing investments while balancing other commitments.
@@BarbaraHarper-c1p Oh please I’d love that. Thanks!.
@@israel-r7 Clementina Abate Russo is her name.
Lookup with her name on the webpage.
I'm 54 and my wife and I are VERY worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, and we are finding it impossible to replace them. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 30 years nonstop just for a crooked system to take all you worked for...
I feel your pain mate, as a fellow retiree, I’d suggest you look into passive index fund investing and learn some more. For me, I had my share of ups and downs when I first started looking for a consistent passive income so I hired an expert advisor for aid, and following her advice, I poured $30k in value stocks and digital assets, Up to 200k so far and pretty sure I'm ready for whatever comes.
@@AnnelieseGretel That's actually quite impressive, I could use some Info on your FA, I am looking to make a change on my finances this year as well
@@Oliver-Lucas My advisor is Alice Marie Coraggio;
You can look her up online
@WilliamEthan00 Nah I Can't say I can relate, Alice Marie Coraggio charge is one-off and pretty reasonable when compared to what I benefit in returns...
There is borrowing capacity, I bought two properties and after that banks are not giving me any more , Dilleen is working as property agent and making money from clients adding to his borrowing capacity. You need to have high and more income to continue getting additional loans
Poor you with your two properties. My heart goes out to you.
I understand your feeling, I love properties , but can’t get any more loans
If you put your investment properties into company trusts, some lenders will ignore their existence when it comes to borrowing capacity
Exactly
@@gun30tyou’re going to try and make tongue in cheek comments because someone put their balls on the line and worked hard to save for a deposit. 2 properties but probably up to their necks in debt, you know nothing about how stressful this financial burden can be.
Great plan but just after this was made, we had 13 rate rises in 12 months. Cash flow would be frightening.
It's important to be flexible and adaptable in business, especially when unexpected changes occur. In this case, it would be wise to reassess the plan and make adjustments to account for the increased rate rises and potential impact on cash flow.
The rates are always going to change. Don’t let that stop you from making your money.
Need to have the budget for the cases and I think if interest rate is about 3%, you should lock it to fix rate
Exactly
This is extremely simplified, some lenders won’t let you access your equity depending on your servicing capacity, I literally just had this happen to me even though my salary is $200k+ the lender wouldn’t factor in my overtime and would only take into account my base rate, have $200k+ in equity and couldn’t even access $100k it’s far from this simple.
Let me explain something to ALL OF YOU complaining about borrowing capacity. 1. This is EXTREMELY difficult, but not impossible. I would give this plan in this video a success rate of 1% if that. 2. Banks do not consider property equity (how many properties you own) when it comes to borrowing capacity. They care about your INCOME, meaning you can own 10 homes but if you make $1K a from a job, good luck getting even ONE mortgage. 3. Oh, what about rental income? Banks ALSO do NOT consider rental income as an income to increase your borrowing capacity, as they know you can lose tenants, hence, lose rental income at any given unpredictable moment.
There is, however, a way to increase borrowing capacity through rentals.
THIS IS HOW: You set up a corporation or LLC or whatever it’s called in your country, receive the rental income through that corporation, and have that corporation HIRE YOU as a PERMANENT EMPLOYEE, with a labor contract, pay stub, social security, employment letter, etc. This WILL BE considered by banks at the time of calculating your borrowing capacity. Furthermore, you will have to do this for at least 2-3 years before any bank will consider this corporation or company as a feasible credit subject (a stable business).
You’re welcome.
Hey! thinking of implementing this strategy. Could you do another video elaborating on the banking/borrowing side of things? Thins such as: What are the ranges of loans from banks regarding income? - Do banks see overleverage with buying so fast? - What do banks require and the overall time between loans? Thanks in advance
I think this is applicable in theory only. If not everyone would be using this method to be "guarantreed" rich within a short time.
This method is basically out the window now mortgage rates have gone up, best way to make this work is wait for the inevitable slump/crash in house prices and get in then and hope the boe has to drop rates right back down due to the destruction they cause in the economy by trying to fight inflation.
Great content, videos like this and insight from an expert really helps.
Hello Jax dier, how are you doing?
great plan. the bank very happy
Sounds good on paper. One more issue to consider is the Transaction costs are roughly around 5% give or take and one maintenance or bad tenant could make a positive CF a negative one. So in your example 300k with stamp duty and other expenses will require another 15k and with 90% one may also have to consider LMI which may be another cost to add.
Eddie's figures used in the video includes associated costs like stamp duty, legal fees, LMI, etc.
@@eddiedilleen_ Do they include how much someone would be underwater haemorrhaging cash right now if they did it?
I know. Anything is great on paper but in reality it only works for 1-5% of people.
Great theory based on highly positive assumptions.
Good Luck
I lost over $80k when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I found one source to recover my money, at least $10k profits weekly. Thanks Kimberly Ann Doran.
Wow. I'm a bit perplexed seeing her been mentioned here also Didn’t know she has been good to so many people too this is wonderful, I'm in my fifth trade with her and it has been super.
The very first time we tried, we invested $2000 and after a week, we received $9500. That really helped us a lot to pay up our bills.
I'm new at this, please how can I reach her?
she's mostly on Telegrams, using the user name
@Kdoran59 ..that's it .
Thanks for the video Eddie. My concern would be that if you have used equity on a property could the bank then margin call you if the property price reduces? It seems likely that property prices will drop 15-20% in 2023/2024. This along with interest rates possibly exceeding the yield (possibly getting as high as 7%) makes this aggressive style of investing seem very risky to me. What will you do if the above does happen?
Bro that many properties by 30? Hats off to you man
Thanks Vito! Almost at 50 properties now :)
No one ever explains borrowing capacity limitations in these examples.
Unless making 200k a year, you’re not getting 1.2million dollars worth of debt in 8 months (for he first 4 properties).
Can you explain how to get over his hurdle?
This is precisely my question
@@krishnatrivedi3676 Notice how no one ever answers it lmao
Positive gearing ?
You don’t need 200k a year if it’s positive geared
No, not the way banks assess rental income and the timeline you need to meet their requirements. Banks assess rental income at 70% or 80% of net, and to then get a property to 20% yield on debt you're waiting for a few years.
So this doesn't answer the question of buying 10 properties in 3 years. Even if they all make $500 a month net profit, the bank won't loan you anything beyond your first 3 or 4, simply because the way they assess you will actually be running at a loss, because they're hyper conservative. You would need something like 60% LVR across your entire portfolio for your rental income to even come out neutral based on a banks assessment model. Unless you're coming in with huge deposits, you're not getting to 60%LVR inside 3 years on even 1 property.
So it doesn't make sense that you can buy 10 in 3 years unless you're solving that borrowing capacity problem.
I've bought 2 properties, with a total portfolio value of around $1mil, in 3 years, and I have an average LVR today of 70%-75%. And that was in the extreme conditions of Covid during that huge growth period. Both my properties are also positively geared by about $500 a month each. In normal circumstances, that ain't happening.
I appreciate the reply, but it's incorrect haha. Do you have rental properties? This is something you would know if you do..
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How to get enough loans for the third and fourth properties?
Thanks Eddie
You're doing a great job mate.
BANKS. DO. NOT. LOAN. OUT. MONEY. LIKE. THAT.
It's largely based on your income. You need to be a very high income earner if you want a bank to hand you that many individual home loans.
Not to mention your plan involves landing "3 pointers" repeatedly and if you miss just one, the house of cards falls apart.
Forward thinking and proactive planning leads to success... but this video is pie-in-the-sky stuff.
Yes they do. Done it 25 times
lol. He clearly said that he had to save about 20 genuine deposits. He is using equity and savings.
20 genuine deposits in todays money would amount to roughly 2 million dollars. Average Joe's are not saving that amount in their lifetimes.
@@Will-yr3zt oh stop it. Deposits range from 5 to 20 percent of purchase price. 5k to 60k just like he said in this video. Please use logic and math before rattling off false information. If you make 40k at one job and 20k at the other it would take roughly 3 months to 2 years by yourself. With a significant other it would take way less time.
Oh. And there is deposit assistance programs that will just give you 10k to 40k.
Then there is NACA that will give you a mortgage for a quadplex with no money down at all with a less than market rate interest rate.
If there’s a will then there is a way.
Not trying to be rude, but people that think like you water a lifetime wishing you could out even becoming bitter over the years. Just know you can and find a way.
The more cash flowing properties you get, the more your income increases. Even with the first multifamily property, banks consider you potential rental income as income for approval purposes.
Using equity is easy, it's the borrowing cap that is hard. Good luck servicing 10 rental purchases on standard 2x family income. Most will cap out at 2x rentals and an Oo property max
He really doesn’t address it.
Once they start with property 5 they have like $2m debt and no explanation as to how you borrow more
@@jrtpaul man that's it exactly, there just isn't enough income from a standard couple for 2m in debt even with a few rentals all cash flow positive
True
Well, he did say in the video that he worked 2-3 jobs, maybe that’s how he can borrow more?
Yep you’re gonna have very low equity in every property (risky when things turn) and assuming you’ll buy 10 consecutive properties for 10% ‘under market value’ in a row is easier said than done
This strategy can be done but the above example is using very favourable circumstances across the board
Can someone explain this? 06:00
I still don't get it. You get house re-evaluated at 360k, and you take 320k (90%) as a loan instead of your original 270k
You take an extra 50k in loans? So you go 50k deeper into mortgage? How do you get that 50k in your pocket?
Great explanation 12:20 seconds that you have worked your arse off for the deposits. I was thinking, how come you can buy only with the equity as bank will think the loan is not serviceable if you do not have job. Great strategy Eddie.
Hi Eddie, your book and videos have been so helpful mate. You’re doing good work keep it up 👍
Lots.of ifs and buts in that strategy.. but appreciate the insight
Mate where are you buying $300K properties in "metropolitan" cities like Brisbane or Adelaide?
10km - 40km radius from the CBD - also in Perth too, we can pick up deals from 200k - 700k
Wow Thank you so much I understand 100%. It is a magic. and it is going to really work in Booming market like nowadays.
👍👍👍👍👍
Thank you for the info. looking forward to learn more.
This method bot suitable in Malaysia because process to buy 1 house take 6 month and and for rental income declaration by bank is 3 month.
I am more interested to know how you serve your loan interests repayment?
This sounds good. Can you tell us where are such properties in Canada? Ontario. NOT a chance.
Hello N M, how are you doing?
Can you find the owner who sells property under market value?
The bank will only lend you 80% of the equity, how will this method still work?
After that go buy a telescope an become an astronaut
😂😂😂
Comedy bro 😂
Hi Eddie, thanks for the video. By taking equity out of the properties, that means you will have more debt on that property, and reduces your cash flow for that property. On top of that, there are the new loans for the new properties. How do you actually pay for all the mortgage payments? And when do you actually start to have a high cash flow from this strategy? Thank you.
With the re-evaluation, I would assume that the debt would not really increase relatively?
the new loans should be covered by tenants if you do your numbers right and are positive or neutral geared. All investment properties ideally should be on Interest only for 5 year periods to start. That reduces costs and increases cashflow while building equity.
yes but still with interest only aren’t positive cashflow. Very rare or everyone would be doing it
Hello squallzie, how are you doing?
Thanks for the content, I’m just starting to look for buying and investing into properties and this gave me an great perspective on what to do and look for
You're stupid if you think these clowns know what they're talking about. Wait and see... things are turning as I advised years ago.
So to get under market value is the main issue.
The strategy is good. However, what is your income that allows you to borrow these loans from the bank? What if all the houses were not rented out for what ever reason? You would need to service all the loans?
I’m always baffled because the banks always seem to tell me that I cannot loan any more?
Your right, his strategy is not feasible. He saying as if the bank will lend you all the money with income even under $50,000 a year @@. You must be earning more than at least $300,000 a year to adopt his strategy
this strategy is usually for well of people, especially in times of high interest rates
Go to a broker, the bank wants to see you run it as a business. You best bet is multi accommodation if you can get 4 rooms or that's 10 to 15% rental return. The more immigrants come in the easier this will be the less strick the laws will be
This sound good on your board, reality is totally rough out there with banks, rates, loan capacity...
Mate with all due respect what are your maintenance costs on your 40 properties do you sleep at night and if you do you must have the world's greatest tenant's and the cheapest trade's people in the market 😉
Properties management companies can handle that
It's going to be EPIC!
Thanks I’m going to do that. I have equity in my
current property I can use
Great channel 👍I like investing on ETF but I like houses... I had nvestment properties but it was in Japan..now I want to buy the investment properties in Australia with my kids! Different systems but Australia is easier to start the investment than Japan if people know how to do it. Also Australia is a great country as population is always growing so rental property is always in high demand! Thanks for sharing your experience. Ill use your videos to educate my kids.
you know what they say ,it takes a village to raise a child .but i think that applies to everyone ,not just kids .we all need a community to support us , to help grow , and to learn from each other . i truly believe that community is one of the most valuable things in life
They have an extensive library of articles and videos on personal finance and investing topics. They also offer live webinars and Q&A sessions with financial experts. And of course, there's the community forum where members can ask questions, share their experiences, and learn from each other
Wow, that sounds like exactly what I need. I've always felt intimidated by the world of investing, but having a supportive community to learn from would definitely make it less daunting. How do I join?
You just explained why Chinese and Vietnamese own so much property. Regardless of the relationship with family they always pull together to buy into a property or business, Aussies aren't as resourceful and are lazy and spoilt , to further confirm my statement you will hear Aussies complain about Asians buying all the properties but fail to admit that the obvious reason for this is that they work hard and save and band together because generational wealth is paramount for the longevity of the family generations to come , they do it legitimately and legally most the time too.
The first gen of the Family knows and accepts the honour of dedicating their lives to work and gaining wealth so their following family members don't have to suffer,
Surely there aren't many properties left at 300k. Maybe in adelaide, or maybe Perth, but surely not Melbourne or Brisbane.
There are still properties for around 300k in Brisbane and Adelaide. We get them off-market and below market value which helps :)
I bought a property for 520,000 and the value now is $450,000. It’s lucky for you if price has gone up.
Find someone dodgy to do you re revaluation submit this to 2nd tier lender and buy another property
I have $200K in my bank account but no confident to invest on RE. I'm still dumb on investing, scared of losing my money. I need proven success before I embark on this journey.
You can't go wrong with real estate in Sydney
Thanks for the video - A question : you talk about financing 90% but we also need to pay our monthly installments but the amount that we get from the rentals is not sufficient to pay off the monthly loan installments so we end up paying additional every month from our own equity.
How will you work this out?
That's where he's saying to live frugally, extra jobs and grind it out.. You still have to pay regardless..
Dont forget the tax return you can get from your day to day job, because you invested in bussiness gov pays back your tax..
Yeah you are fcked when you cant pay. Goodbye the deposit, as long as this guy got his cash form the bs seminar or whatever he's selling
Pretty bad assumptions that house increases so much and the banks are not that keen on 90% refinancing for investment. Generally they look that paid the house down to 80% of the value is zero equity.
thanks for the video, do we need to consider borrow capicity from bank?
Yes of course, this definitely comes into it.
Hi I’m wondering about where u can find properties worth $350k in Australia
we are finding properties in this range around Perth, Brisbane, and Adelaide in Metro areas about 10km - 40km to the CBD
Come on bruh, I will come back 3 years later when you already got your 10 houses LOL
How did you go from a 50k deposit of 300k to borrowing 270k isn't it 250k.
Finally someone explaining how you beat the borrowing capacity issue 🎉. Just have to pay a higher interest rate with lower tier lenders
10% deposit of 30k + the associated expenses around 20k = 50k total :)
How do you get the properties under market value?
We have a video on this: ua-cam.com/video/hUoPP2ozKUs/v-deo.html :)
Hello Hannah M, how are you doing?
Which apps would you suggest?
I'm going to assume that $300k for an investment property that has "strong cashflow, metropolitan based and good capital growth potential" is just an arbitrary number right? Because trying to find a home that fits that criteria under $300k is damn near impossible. Which makes me think that this entire strategy and timeframe is completely unachievable..
Hi there, we are still buying properties for as little as 200k - 250k in the current market. You just have to know where to look + it helps getting access to urgent sales that are typically discounted already!
Thanks. I'm curious to know why you opted for a duplex rather than single family homes ?
Just an example, either could be used. Duplexes tend to have higher cash flow though
Are the loans variable? What happens when interest rates rise?
Thanks for the video. I want to get started very soon and would like a 10 year exit strategy. What do you think about apartments in small blocks that are easily renovated. I'm handy with the tools.
Great video. Really got me thinking. That's a lot of debt to accumulate, tho. At what point would you hit the breaks and sell like 3 or 4 of them with the growth and try and bring the loan down a bit? Then you could clear all of it even if you just got too keep two(ideally) and then restart the cycle to mitigate the risk.
Thank you so much
Hello AussieMe, how are you doing?
This only works for houses, with apartments the OC fees would bankrupt you
Problem is you can't buy a property in Brisbane for $300k it would be rat infested shoebox in Inala... and wouldn't be able to charge anywhere near $400 a week rent to be positively geared. Destroys the entire framework of the strategy.
Hi James,
We find plenty of properties around the 300k mark in metro Brisbane that are of good quality and low maintenance, additionally the rental yields are strong - minimum 5%.
If you'd like to see this, check out our instagram for example of properties we help clients purchase :)
Hello Alexander Mcpherson, how are you doing?
How do you service the loan in the bank's eyes when your borrowing capacity is $600-$800K?
Its impossible
Thanks for sharing your experience. My question is how to get mortgage for the second property?
What happens is for next property bank considers rent as your income
That is why if you are low earner first 2 property should be positive cash flow
The problem usually start from property 2 onward as banks considerc%80 of rent as income oppose to payg which is %100
Is now a good time to buy "under market value" in Melbourne?
im on 60k a year after tax, i have a property with about 150k equity, if i move back with my parents and save and use equity could i buy 2 properties within 1 year?
no kids no mrs im 41.
seems like im in a good position going off this? should i aim higher? i could stay with the olds for max 3 years
Sounds like you're in a good position! Would recommend giving us a call to assess your options and find out your borrowing capacity. 1300 833 118
Anymore video I am keen to learn more please
HI great video would love to chat further and learn how to make this happen . Sharon
Hey Sharon, sounds good! Please send us an email on admin@dilleenpg.com to get the ball rolling :)
Hello Sharon, how are you doing?
Thanks mate
This may involve finding ways to increase revenue, reduce expenses, or secure additional funding to ensure the business remains financially stable.
Hey mate, is this using interest only loans for best early cash flow?
Yes!
@@eddiedilleen_ I have one more question, I’m about to buy my first property with first home buyers guarantee. Would it be more wise to get the most expensive property I can, considering I won’t have to pay stamp duty / LMI or buy something cheaper that will have positive cash flow? I’m thinking cash flow but would like to hear it from someone with experience. Thanks
People are forgetting property that’s an investment or whatever you gotta be insured but I have rates paid all strata might have tenants that going to hardship and can’t pay or won’t pay for damage stuff unless you got a reasonable salary I wouldn’t suggest to get into this it’s just from my experience I went for a job that I was earning 70,000 of the space of 2 to 3 years I was only earning 45,000 interest rates go up to take into consideration all the sort of factors so have the multiple properties they will need multiple insurances this bloke should put your towards the insurances who is the best insurer for all your properties it’s not as clear cut as what display is making it so be aware
Good strategy, BUT, you start off with a loan of 270k and after pulling out another 50k for the next deposit you owe the bank 320k, thats hundreds per month is repayments. So it only works if you're getting excellent rental returns, otherwise your ability to make those repayments is eliminated.
Yes, the strategy we follow is by obtaining properties that are below market value, with strong rental returns, and growth locations in metro capital city areas.
We focus on yields in the current market between 5% - 9% so most of the time this will be neutral, slightly positive, or worst case slightly negative - but manageable.
The goal is to have the property servicing itself :)
Growth locations now are 160k deposit for 20% minimum
@@eddiedilleen_ 9% yield is fantasy
i am based in Sydney looking to buy my first property in Australia. let’s say the market is more favorable in a different state.
when you first started to buy outside NSW, did you always go to inspect the property before signing your investments?
I'm reading your book, Eddie! What an amazing success story! You inspire me
This strategy is just before interest rate goes high like nowadays. How you survive with high interest rate?? You could increase rent but what if you cant increase rent as much as increased price by increased interest rate ?? Any idea ? I would like to analyze worst scenario which can occur to anyone who can see your video
Any respond Dilleen??? Try to avoid up to date real issue ???
Hey! We have a video going out tomorrow where Eddie addresses the interest rates increase, keep an eye out for that :)
great content mate!
I read your book, but the only issue here is that the property isn't 300k in Australian metro areas anymore. Unless you can give me an example? The math makes sense but you are looking at the 600k mark.
Hey Ryan, it certainly is still possible in today's market. We are currently sourcing between 200k - 700k. You can check out our instagram/fb for some of our property purchase examples if you like :)
For more info on what we do you can email my team here: admin@dilleenpg.com
Why did you choose not to buy quads with 100k though? Any reason?
I’m really interested because I am actively searching for a quadplex. I would like to know if there’s something i should be aware of. Thank you in advance.
The video is good but what about the cash flow ?
❤️🙏🧿 Sounds good. But finding those properties is the hard part. And buyers agents want 10k to 15k to find a property 🤯😱... 10 properties that's 150k just to buyers agents. In the USA it's only 2k to 5k to buyers agents which makes more value sense 🤔
❤️🙏🧿
Hey there, definitely understand where you are coming from, but there's another way to look at this...
As an example, our buyers agency sources properties for clients that are 10%-25% below market value. This essentially means you are making money on the way into the property purchase. (e.g. purchase a property for 425k but it's value is 500k)
If you were to source properties by yourself, you may not be able to access properties that are below market value, you would most likely be paying market value or more.
The fees paid to use a service like this are minute compared to the money made/equity gained going into the deal.
Hope this helps :)
@@eddiedilleen_ I understand your view point. I still don't agree with the pricing, I believe buyers agents are over priced. 🙏
@@et8893 that is true!!
There are many in fb offer seminar, how to find or finance the property below market, but at the end they charge you 10 K. Wtf ...
@@prospectus2011 Greedy people and nothing else. There is nothing that a buyers agent does that warrants 15k price. I would love to see there break down of the hours they put into their work for each client to prove the 15k price.
The words Below Market Value is a joke. The price something is sold IS the market value. Its in the words "Market Value", which mean that`s what the Market would pay for it. Advertised value or Recommended Value or Median Value is different. Remember they sell their service with Zero guarantees but somehow want 15k.
* Do they have a place in the market, yes they do. But not at 15K.
In the USA they charge 2k for basic service and 5k for Top service which is more reasonable.....
This is awesome!
Can this still be done with todays interest rates?
This strategy can still be applied in todays market yes. However properties with positive cash flow can be more difficult to come by, they may be slight positive, neutral or slightly negative geared. The main point to focus on is buying below market value :)
Your theory is built on the scenario of properties in the 400k mark which are diminishing currently. Also you are forgetting the most important component of borrowing capacity. No bank will give one person all these loans
Eddie, could you please suggest a Mortgage broker please? 💸
Justin Picker is our recommended Mortgage Broker, you can make an inquiry using this website: www.pickerfs.com.au/contact/
Hello Siva Charan, how are you doing?
Houses or units? Does that make a difference?
Good to diversify between Townhouses, Units, Duplexes and Houses. It comes down to the number at the end of the day when choosing a good property deal, not so much the property type.
How can you buy under market value?I'm sure buyers know what the price of the property?buyers are not dummies
When sellers have a time constraint to sell for urgent reasons they are usually willing to sell for a lower price point to quickly offload the property. That's where Eddie comes in, as he has good industry connections with real estate agents and bank administrators, he can get access to these kinds of deals when they come about :)
all the best with finding decent property in Adelaide or Brisbane for 300K
How about borrowing power
Hello Joyce, how are you doing?
how are you buying all these properties when the combined value of all of them will be more than your borrowing power?
Have an investment property in bathurst.Want to buy another somewhere else.Any suggestions? Where abouts in Perth?
Yes if u could do this it’s great . No house in Australia is in 300 k with a gd rental yield .
We have been getting great deals between 200k-700k in Metro Bris and Adelaide with around 5.5% - 9% yields. Take a look at our Instagram or Facebook for our recent properties sourced for clients :) @dilleenpropertyau on Instagram.
Note: we source Townhouses, Houses and Duplexes. Townhouses being the most affordable and on the lower end of the price range.
what about land tax?
Video is now live on the channel addressing the land tax changes if you want to check it out :)
If interwst rates are 3%
I am PhD student is I buy any property in Australia
Commbank want me to keep 20% equity in my property, so then I could use anything over that to buy another property.... Which bank/broker lets you keep just 10% equity in your property?
2nd and 3rd tier lenders
Each time you take out equity, doesn't this become another loan you will need to pay interest on?
Is that an idea of selling all off after 10 properties to buy 1 property worth $3m near cbd for aiming capital growth?
What about servicing ? I have tried this and the banks wouldn't loan me despite having equity in three properties because my income wasn't enough.
Servicing can get tricky in times like this when rates are up, sometimes it's a waiting game, or you may need to find ways to increase your income, reduce your expenses and reduce your liabilities.
It's also important to have a good mortgage broker with investment experience as they can come up with alternative options for you/have access to banks with less strict policies
which bank would let u cashout for 90% property value after refinancing? I could only pull out 80% of my first. Theres hardly anything for single house at 300k range within those 3 states u mentioned about. 😂
How can I go about it now in a high market now ?
Hello Jenice Moran, how are you doing?