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GCS15

Just Realized I Am A Millionaire/ Now What?

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Hello all,

Thanks for taking the time to read my post. I am new to the forum, although I have looked in here occasionally year after year. I have read all of Jan’s books during the year, but have been to busy too implement the ideas to realy be able to say that I know what I am doing! But the time has come to set up some infrastructure and make my money work for me! It has all been trial and error and gut feeling up to now, and it has paid of pretty good. To make it as brief as possible, I will give some detail.

My husband and I have run a very successful business for the past 25 years, in the building and construction area. We are young 47 years olds.We want to take a year of to finish some projects, but also want to start our real estate portfolio in earnest, as a hobby, and also as a retirement strategy. The business will recommence after a year ( guaranteed) so cash flow after the “holiday” period will be taken care of. During this year, I want to be able to invest in some more property, to grab opportunity as it presents itself, and also to make the path for our changing lifestyle. We envision ourselves spending time in North Qld, Brisbane and the Gold Coast, at monthly intervals—our business will allow us to do this.

We have various loans for IP at present, with a lot of equity, but I guess over the years, I have not thought about how to structure these for maximum benefit. Our accountant is great at doing our tax, but is very conservative when it comes to property. Our bank manager loves us, and obtaining loans is no problem. However I have had to make up the game plan as I went along. We paid of our mortgage by the time we were 30 and all our IP’s have been built and held by us, over the years. Our strategy has been to build upmarket houses for ourselves, hold for 5-7 years and sell, and build medium range IP’s and hold. We have also built our own factory, from which we run our business, and which is currently also receiving rent from outside parties.

Current picture is as follows:’

PPOR- $490000.00 / mortgage free

IP1- $1000000.00 / owner built property ( built over 5 years

IO loan- $ 203000.00 / available excess loc of $116000.00 which has sat in the account ready for use for the past 3 years

IP2- $320000.0

PI loan $142223.00- / Repayments $730 P/fortnight

Rented at $260 p/w to family member ( should be $310)

IP3- $280000.00

IO loan- $130000.00 / Repayments at $770.00

Rented at $260.00 p/w self managed

IP4- $510000.00 / Repayments at $1076.00

IO loan $189525.00 Rented at $420.00 p/w Managed by rental firm

IP5- $420000.00

PI loan $108450.00 Commercial/ Repayments at $1900.00 p/m

Rented at $350 p/w as well as owner oc

IP6- $200000.00 vacant land/ Repayments $600.00 p/m

IO loan $74000.00

IP7 $500000.00 vacant land/ Future upmarket home to be built in 3 years/ Ocean frontage/ loan free

IP8 $150000.00- Marina Berth/ loan free

Rented at $100.00

IP9 $750000.00 Of the Plan Unit/ current resale value

IO loan $470000.00 loan not yet drawn/ expected late 2006

IP10- $500000.00 New purchase/ Unit at Gold Coast

IO loan $450000.00 used $45000.00 cash deposit, but do not know if this was the correct strategy. Contract being signed this week

Apart from this I have a share portfolio of about $80000.00 and super etc is all in place.

Last valuations were done 1 year ago. I keep reading about the importance of valuations and refinancing etc.

Should I be looking at doing this- getting yearly valuations?

Is it better to combine some of the loans, and if so, why?

Should I be able to use my equity to finance some more property, without having to worry about the shortfalls?- (we need to ensure a years holiday with limited cashflow . Even if we build a house and sell it in this year, the week to week cashflow incliding the shortfalls, is not going to let us eat) I feel that there are definitely some opportunities out there at present and do not want to wait until after the year break to start. Our business is run through a company,all of the IP’s are run through our partnership, but I have a trust in place which remains unused, as I don’t have a clue on how to use it for my investment portfolio!

I was going to sell our PPOR to pay out the commercial property and the IP1 loan of $203000.00, to free up some cash. This will then become our PPOR for 5 years. Is this a good idea?

I was also going to sell IP4 to free up cash to enable us to buy more property, but I don't realy want to this as the rent is great, and the loan is small in comparison to its value. Do I need to sell this or is there an other way?

Can anyone make some suggestions??

( and by the way-- all our properties are in Mackay/ some have doubled in value over the past 2 years. The growth here has been enormous!)

cheers

__________________

Time flies when you are busy

http://www.somersoft.com/forums/showthread.php?t=22286

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Sell Property, pay off debt: convert it into real wealth:

Not just theoretical paper profits

Its a no brainer!! Even for someone like me :lol:

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  • 339 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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