485k is a very good buy for this house. I am not a DIY person but would have outsourced to tradies for paint and carpet. Spent max 15k and rented it for 500pw. Another point to consider while valuing the property is it doesn't have a garage just a carport.
Hey mate, enjoying your content. I’ve just done a similar reno at Redcliffe so it’s really relevant to what I’m doing at the moment. Thanks, keen to see more updates!
Fantastic video, thanks for sharing! I agree you need to crunch the numbers and stick to your limit. It's so easy to become too emotionally attached to a property and get caught up in the moment. Loved the potential ideas you envisioned.. the house had a lot of natural light and seemed to only need updating, painting & new flooring throughout.. I prefer seeing vacant properties as you're not distracted by clutter or ugly furniture 😆 I think it's smart that you're growing multiple streams of income to achieve your goals sooner rather than later.. we're just in the process of selling our house here in the UK as we're moving back to Brisbane permanently (just waiting for the paperwork to be finalised etc) our plan is to use most of the house sale money as a deposit towards a cheaper house and rent it out here and put a deposit on another house in Brisbane area so we're spreading our risk.. what do you think?
Agreed definitely important to walk away rather than work for free! We thought the property woulld scrub up nicely. Don't mind any clutter, just need a good buy price and quick turnaround time for the reno. You approach sounds sensible at a high level! Making your money work harder
All pretty basic / obvious renovations discussed. Superficial / cheap as possible. From a buyers perspective always be wary of a house that's been bought renovated and resold in a short period of time..eg few months. You know for a fact they've done the renovations as cheap as possible. Painting things instead of replacing them for instance. Also most likely all done by handymen and not professional tradies..so will ne sloppy work most of the time..
Pretty much looking all over Brisbane to be honest as a short term flip. More about the buy price and renovation costs as long as the area meets the basic investment fundamentals
These Auctions can be exciting for buyers involved. Yeah I agree Luke, better to stick to our own budget and go with that as you correctly mentioned, these types of properties pop up from time to time. Better to wait than regret! Another Great content! Cheers 👍
So basically you work as a tradie and an agent and risking under high rate mortgage for only $50k profit in 6 months? Would it be easier to just work as a tradie and as an agent and make more money with almost no risk?
6months is the longest expected timeline. The actual renos would be on the side (of day job) and take about 8weeks. So earn 2 sets of income for a little extra work on the side. Save on trades and save on selling agent fees
Whats the benefit of doing a short term month to month interest payment with the bank at 10% for a flipper instead of just taking out a regular mortgage at a lower rate?
Capital gain is generally on 100% of the gains if sold in less than 12months. We have a family member with carried for Capital losses so we can offset gains, if we set up the structure correctly
No, if you are able to renovate and flip within 6 months as ATO treat both your POPR and the flip home as POPR for the first 6 months and you need to dispose one property within 6 months, if you don't then CGT will apply even though you are not putting the second property on rental market.
@@lukewiles1 awesome. I’m eligible for a business loan as I own a profitable painting business. Would I be able to use the loan as a deposit on a house to start flipping?
All obvious superfical renovations. Things to consider from a buyers perspective is when you see a house has been bought ony a few months earliwr and resold..with renovations is that everything will have been done as cheap as posible..and most likely not by tradies byt by the flippers . So the work will be sloppy.
Hardest thing at the moment is not overpaying, as in buying now and with increasing rates find out you cannot sell a renovated property for the price you originally purchased it at. Realistic scenario to run with if you factor in 10-15 percent drops from current prices. Downlights, new fans, paint and some landscaping do go a long way, however as the saying goes you can't put lipstick on a pig, overcapitalizing in an area with certain socio-economic profile and low spread between the "expensive and cheap houses in a street" is a real risk.
Have to agree, with what we're seeing. Don't want to overpay for something that might pull back another few percentage points in the time it takes to renovate. We're also looking at higher end areas - just depends on the opportunity
So if you sold it you would of sold it for $50000 more whichthan would get taxed???? And how would of you planned to pay the repayments?? I can’t afford 2 houses of repayments??
@lukewiles1 Thanks again for the reply . We are planning to sell in around 6-12 months so will defn consider doing it myself. Would be an interesting topic for a video if you haven't done it already.. Ie how to cut out the real estate agent
I think to be more accurate, you should be factoring in the "man hours" spent doing Reno in costs. Eg if the 4 of you soent a combined total of 150 hrs doing Reno at an estimated figure of say $30 an hr for your time. That's 45k. $30 an hr is just a guess.depends on what you'd likely to get paid doing this sort of work for someone else..or even a different type of work ..depends on your situation. Another consideration is what the market market did over the time you owned ir.. for eg if market generally in that area for that kinda of house went up 5% in the time you owned it then that's contributed to your profit..conversely if market went down 5%..it's eaten into returns. I'd call that the luck factor ..but 1coule argue there's sskill i timing the market. Just been thinking about doing It myself lately and also whether it's worth doing a Reno on my place before selling . And these thoughts popped up
Its difficult to flip properties in QLD because stamp duty kills so much profit. You should also talk about the ownership structures to maximise your profit.
Can you still spend 25k, putting some turf down, tidying the gardens, a quick exterior / interior paint refresh, refresh the floors and carpets, put some blinds up, a few kitchen / bathroom fittings; And then having that property gain 100K? Some people still think it's possible, but I reckon those days are over in my view. It works very well in a rising market however, but I reckon it's the market which does the heavy lifting. But I reckon you've got the skills to do it Luke!
Well shit, that was a waste of everyone's time, yours, theirs and mine... You took us through all your plans and then it was just a hypothetical... without any evidence that you achieved what you set out to do...
485k is a very good buy for this house. I am not a DIY person but would have outsourced to tradies for paint and carpet. Spent max 15k and rented it for 500pw. Another point to consider while valuing the property is it doesn't have a garage just a carport.
Not a bad buy price for a rental but we're trying to flip to get our cash back out of the deal + profit
Hey mate, enjoying your content.
I’ve just done a similar reno at Redcliffe so it’s really relevant to what I’m doing at the moment.
Thanks, keen to see more updates!
We may have secured something! More to come
Fantastic video, thanks for sharing!
I agree you need to crunch the numbers and stick to your limit.
It's so easy to become too emotionally attached to a property and get caught up in the moment.
Loved the potential ideas you envisioned.. the house had a lot of natural light and seemed to only need updating, painting & new flooring throughout.. I prefer seeing vacant properties as you're not distracted by clutter or ugly furniture 😆 I think it's smart that you're growing multiple streams of income to achieve your goals sooner rather than later.. we're just in the process of selling our house here in the UK as we're moving back to Brisbane permanently (just waiting for the paperwork to be finalised etc) our plan is to use most of the house sale money as a deposit towards a cheaper house and rent it out here and put a deposit on another house in Brisbane area so we're spreading our risk.. what do you think?
Agreed definitely important to walk away rather than work for free!
We thought the property woulld scrub up nicely. Don't mind any clutter, just need a good buy price and quick turnaround time for the reno.
You approach sounds sensible at a high level! Making your money work harder
All pretty basic / obvious renovations discussed.
Superficial / cheap as possible.
From a buyers perspective always be wary of a house that's been bought renovated and resold in a short period of time..eg few months.
You know for a fact they've done the renovations as cheap as possible. Painting things instead of replacing them for instance.
Also most likely all done by handymen and not professional tradies..so will ne sloppy work most of the time..
Always great to see how you break down the process and include the numbers Luke
thanks mate - good to hear you get value out of the videos!
Great video mate. Boronia heights is a treasure chest of a suburb if you can get a good deal. What other suburbs are you looking at for flips?
Pretty much looking all over Brisbane to be honest as a short term flip. More about the buy price and renovation costs as long as the area meets the basic investment fundamentals
These Auctions can be exciting for buyers involved. Yeah I agree Luke, better to stick to our own budget and go with that as you correctly mentioned, these types of properties pop up from time to time. Better to wait than regret! Another Great content! Cheers 👍
I always enjoy a good auction. Not too stressful if you stick to the budget!
So basically you work as a tradie and an agent and risking under high rate mortgage for only $50k profit in 6 months?
Would it be easier to just work as a tradie and as an agent and make more money with almost no risk?
6months is the longest expected timeline. The actual renos would be on the side (of day job) and take about 8weeks.
So earn 2 sets of income for a little extra work on the side. Save on trades and save on selling agent fees
Whats the benefit of doing a short term month to month interest payment with the bank at 10% for a flipper instead of just taking out a regular mortgage at a lower rate?
Great video Luke . Better Luck next time man .
Thanks mate!
Great content .Would like to see more such property around 500k - 600k!!
We have a client purchase coming up in the low 500k which I will be sharing!
@@lukewiles1 Excited for this one !!
Thanks for doing the vid, and showing us the numbers.
No problem 👍
How much would be capital gain tax after selling within 6 months?
Capital gain is generally on 100% of the gains if sold in less than 12months. We have a family member with carried for Capital losses so we can offset gains, if we set up the structure correctly
Thanks for the video. How do you factor in capital gains as I can only assume that will take a chunk of cash out of the profit?
Hi mate. Great video. Just curious, shouldn't we deduct the CGT upfront? ATO will eventually ask their chunk from any flip sales, won't they?
No, if you are able to renovate and flip within 6 months as ATO treat both your POPR and the flip home as POPR for the first 6 months and you need to dispose one property within 6 months, if you don't then CGT will apply even though you are not putting the second property on rental market.
Thanks for the video. Hoping to try follow ! Wish us luck haha
Good luck! 👍
What about capital gains tax?
Is a real estate license required when selling your own property?
@@dzeeeeeee nope :)
@@lukewiles1 awesome. I’m eligible for a business loan as I own a profitable painting business. Would I be able to use the loan as a deposit on a house to start flipping?
@@dzeeeeeee sounds pretty high risk to me. You should watch our flip series from last year, I share all the numbers
Damn hard to flip properties in Australia with the tax man taking their stamp duty which isn't indexed to property values rising.
All obvious superfical renovations.
Things to consider from a buyers perspective is when you see a house has been bought ony a few months earliwr and resold..with renovations is that everything will have been done as cheap as posible..and most likely not by tradies byt by the flippers .
So the work will be sloppy.
Agreed. That can definitely be the perception regardless of who does the work (Builder or diy)
@@lukewiles1 thanks for the reply . Found your video clear and well presented.
Hardest thing at the moment is not overpaying, as in buying now and with increasing rates find out you cannot sell a renovated property for the price you originally purchased it at. Realistic scenario to run with if you factor in 10-15 percent drops from current prices. Downlights, new fans, paint and some landscaping do go a long way, however as the saying goes you can't put lipstick on a pig, overcapitalizing in an area with certain socio-economic profile and low spread between the "expensive and cheap houses in a street" is a real risk.
Have to agree, with what we're seeing. Don't want to overpay for something that might pull back another few percentage points in the time it takes to renovate. We're also looking at higher end areas - just depends on the opportunity
So if you sold it you would of sold it for $50000 more whichthan would get taxed???? And how would of you planned to pay the repayments?? I can’t afford 2 houses of repayments??
What about your capital Gains???????
A fair chunk of the profit discussed was just cutting out the agent.
Which is a truckload less work then all the renos
Yup. I don't understand why more people don't at least try to sell their home or investment themselves
@lukewiles1
Thanks again for the reply .
We are planning to sell in around 6-12 months so will defn consider doing it myself.
Would be an interesting topic for a video if you haven't done it already..
Ie how to cut out the real estate agent
@@Fred-rg5vw good idea. We've sold 4 places ourselves, so we should definitely do a video on it!
I think to be more accurate, you should be factoring in the "man hours" spent doing Reno in costs.
Eg if the 4 of you soent a combined total of 150 hrs doing Reno at an estimated figure of say $30 an hr for your time. That's 45k.
$30 an hr is just a guess.depends on what you'd likely to get paid doing this sort of work for someone else..or even a different type of work ..depends on your situation.
Another consideration is what the market market did over the time you owned ir.. for eg if market generally in that area for that kinda of house went up 5% in the time you owned it then that's contributed to your profit..conversely if market went down 5%..it's eaten into returns.
I'd call that the luck factor ..but 1coule argue there's sskill i timing the market.
Just been thinking about doing It myself lately and also whether it's worth doing a Reno on my place before selling . And these thoughts popped up
Its difficult to flip properties in QLD because stamp duty kills so much profit. You should also talk about the ownership structures to maximise your profit.
Agreed stamp duty takes a big chunk out of the profits. Will do!
great video mate....thanks for sharing
Thanks for watching!
4:28 *splashback
Can you still spend 25k, putting some turf down, tidying the gardens, a quick exterior / interior paint refresh, refresh the floors and carpets, put some blinds up, a few kitchen / bathroom fittings;
And then having that property gain 100K?
Some people still think it's possible, but I reckon those days are over in my view.
It works very well in a rising market however, but I reckon it's the market which does the heavy lifting.
But I reckon you've got the skills to do it Luke!
I'll keep you up to date on the numbers / time involved if we end up getting a renovator!
Well shit, that was a waste of everyone's time, yours, theirs and mine... You took us through all your plans and then it was just a hypothetical... without any evidence that you achieved what you set out to do...