Paul Wilson

By Paul Wilson

Source: djohnsonconstruction
This kitchen is not as bad as it looks and the ROI should be great

Ugly houses get a bad rap.  Ugly houses are properties which certainly do not fit into the “hot property” category but should.  In today’s realestate market, Australian property prices have caused many to have to rethink their property investment strategies.  After a bit of a slump in property sales in 2012 along with an increasing difficulty in locating positive cash flow properties, some are looking at more innovative ways to turn a profit.  Buying a house considered “ugly” is a great way to make the best of a difficult situation.  Why and how?

First, by Ugly houses, I generally mean properties which have been allowed to become run down and in bad shape.  You have seen these.   The seller’s agent tells you that it needs a little work and on seeing the exterior, you make a mental note of paint and gutters.  Then on entering, you see the kitchen is a wreck.

Moving further through the house, you smell an odor and begin to think, no way.  This place is going to take a lot of work.  It is going to require far too much effort to make it either sellable or rentable.  You tell yourself, there is no way I am buying this property.

Finally, you reach the Master Bedroom and your decision is final.  You excuse yourself and tell the agent you’ll be in touch.

But why don’t you want this property?

Is it because it is going to take too much work to turn a profit?  Or is it because you don’t have the capital to pay for the needed renovations?

If the reason is because of the second question and you have no way you can afford to take out the loan needed for repairs and the time required to do the work, then your pass makes good business sense.   I have a friend who recently passed on a great 91 room hotel in a great location because he calculated that he just could not afford the total project costs.  He really wanted the property, but it would have been too risky for him so he just had to pass.

Source” Suenorealty.com
Looks bad, but only minor repairs are needed.

But if your reason is because of the effort required to make a profit and you have the ability to do it, then you are passing on a great opportunity.

This is because such properties often are sold for far lower than they would be worth and make once renovated.   Indeed, as long as the property is not condemned for some reason, the cost to renovate is usually far lower than the returns.  This is why so many are now looking at older, run down properties as a way to make killer profits.  These are often great investments and when done right, can return considerable profits for many years.

For example, look at the master bedroom picture below.  It looks terrible, but really all that is needed is some plasterboard, insulation, paint, and carpet.  This room could be ready in a day or two at the most.  Also, look at the image of the kitchen and dining area to the right.  Again, much of what is needed to this room is cosmetic.  One sheet of plasterboard will repair the hole and three new tiles will repair the section under the counter.

Even the burned up kitchen will only take relatively minor repairs.  I know it looks bad, but really it is not.  Insulation and plasterboard will take care of the ceiling.  Certainly new appliances are required, but often these must be changed out anyway, if they are included in the property at all.  Paint naturally will go a long way to making this kitchen look much better.  Perhaps the only thing that will be costly is the replacement of any electrical lighting, wires, and fixtures.  Really, the repairs even to this room would be minor compared to the price you will likely pay for the property to the rent you can obtain.

Source: commons.wikimedia.org
This Master Bedroom looks worse than it really is. Little is really needed to make it pretty.

The bottom line is this:  If you walk into a property that looks ugly but with a few renovations can be made pretty again and you can get a great deal on it, don’t just dismiss the property as not fitting into your portfolio.  You are in business to make money and a great way to make very good returns on investment are in buying ugly realestate and making it pretty.

Remember too that I provide personal property investment coaching and Buyer’s Agent Services.  I have been helping other property investors since 2001 to not only find the right properties but also understand how to safely invest.  If you need any help with your property investing, I would be happy to help.  You can reach me Australia wide at 1800 600 890.

Want to learn more?  Check out these articles.

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Paul Wilson

By Paul Wilson

Source: Geology.com Map shows the believed deposits of oil shale in Australia recently discovered by Linc Energy, which holds the lease

Lately there has been much talk about the recent major oil discovery in the northern corner of South Australia.  In fact, many property investors are already considering property in these areas.  But what exactly does this discovery mean for property investors and how can one do the research needed to know whether to invest or not?  Would this be a good time to invest in realstate in these areas?  Is the realestate market going to boom near these deposits?  Will this drive Australian property Prices higher?

The short answer to the first part of the question is that this discovery doesn’t mean much for property markets at this point so if you suddenly hear of hot property as a result of this find, be careful.  Allow me to explain.

The long answer to these questions is that the oil which has been found is actually oil shale and is buried deep within the ground.  Hence, although this is a discovery on the scale of “Saudi Arabia” as some news organizations have called it, getting to it could be cost prohibitive at this stage.  Thus, the head of Linc Energy, which holds the leases for the area has warned that it is too early to tell whether mining these deposits would be profitable or not.  Certainly, if they decide it is not profitable there will be no mining.  Hence, properties in the region will be largely unaffected.

If however, they do decide to mine then investors can anticipate a rising demand and hence prices for properties within range of the fields mined.  The map below shows the deposit locations as they are believed to exist at the moment, but where mining would occur is anyone’s guess.  So to seek property at this point would be speculation and would carry some risk.  How so?

To start with, until it is known where mining will occur, the property will not be affected other than the normal order of business.  If a property you locate near this region is able to make you positive cash flow, then by all means buy it.  The worst that can happen is you make a little bit of added income.  The best is that mining does occur nearby and you make even more.

But just don’t plan on buying undeveloped land with the belief that it will be worth plenty when the mining takes place for no one, not even Linc Energy knows what will happen at this point.  Also, be on the alert for Property Spruikers trying to sell you land now as they seek to capitalize on the ignorance of many unsuspecting investors.

The way to know what to do these days is simple.  Do a bit of research.

I checked with various sources online and discovered what I have already stated above.  This is not crude oil, but oil shale which is much harder to extract usable petroleum from.  Everything at this point is mere speculation so property investors should be cautious unless they have deep pockets with which to gamble.

However, in doing this research I came across a sure thing.

Have you heard of the Carnarvon basin?

Map shows the locations of Chevron discovery number 20 in the Carnarvon basin recently.

Not much is being said about this location, but according to the Oil and Gas Journal, Chevron has just made its 20^th discovery of LNG in this region and is thus expanding operations there.

Hence, if you are seeking a sound location for investing in hot property, see the next image.  This shows the location of the Carnarvon basin where Chevron is certainly stepping up production.

The point is, finding the facts regarding realestate property is not difficult if an investor keeps his or her wits and checks reliable sources.  The least reliable are the news agencies which get ratings from sensational stories and the property spruikers who make a killing from unsuspecting buyers.

Check with the sources, the companies actually planning the operations.  Check industry sources and check with governmental agencies involved.  If you do this, you can find real hot property for sale.

The goal of Educating Property Investors is to teach you how to invest in properties which will profit you and help you build your portfolio.  If you would like to continue to be better informed, be sure to sign up for our newsletter to the right.

 Other articles you may find useful…

 Seven Tips to Avoid Property Investment & Mortgage Stress

Plan Your Summer Real Estate Investment Strategy

2 Strategies for Raising Property Values

Australian Property Prices for 2012 to 2015

12 Tips for First Time Property Investors

Image 1 Source: Geology.com

Image 2 Source: www.adventenergy.com.au

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Debbie and Gavin are speaking of our sister site, We Find Houses.  We also operate We Find Finance.  These two sites, along with the Educating Property Investors were established by Paul Wilson to take the pain out of property investing.  Too often, people know they should get into property investing as a retirement tool, but find themselves bombarded with more information than they can rightfully manage.  One of the things Paul Wilson does is help new investors learn the fundamentals of property investing without all the gimmicks.  There are no magic tricks and learning how to safely invest is not something that needs to be full of slight-of-hand.  It really is a very straightforward business that anyone can learn.

If you would like to learn how to invest in realestate, properly without all the fluff, just get in touch with us today.  Paul or any member of his team would be delighted to help.  Something to remember is that the real state of property investing is still very good, but without the right information to guide you, the market can turn sour very fast.  Arm yourself with knowledge.  Call Paul.

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Why Buy Ugly Houses?

What Does the Oil Shale Discovery mean to Property Investors?

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Seven Tips to Avoid Mortgage Stress

How to Avoid Overcapitalising when Renovating

Paul Wilson has been helping property investors like Ted Cooper since 2001.  Paul’s first property well before this was the incentive for him to help others.  He had purchased a property that he had carefully researched and determined could be strata titled and turned into a nice positive cash flow piece of realestate.  Everything was in order and since the property had been earlier divided, there was no concern on his part.  He made the purchase and already had the council’s approval when he received bad news.  Someone petitioned the council to change their position and Paul was told he could not strata title the property.  He was facing certain ruin with his very first investment.

This was where Paul first began to understand his slogan that “Knowledge is power.”  Armed with the conviction that he was in the right, Paul fought back all the way to a higher court and won his case.  After that day, he decided that when he understood enough to help others, he would.  That is why several years and countless properties later, Paul launched his own property mentoring firm and he has never been happier.  He loves helping others learn the ins and outs of property investing.  This site along with his others We Find Houses and We Find Finance are all designed with one thing in mind–helping property investors make wiser, safer property decisions.

If you would like any kind of assistance such as Ted received, Paul or any other member of his staff will be happy to help.  Get in touch today and start living what Paul likes to call “Lifestyle Great” rather than simply a “Lifestyle good.”

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Founder Of We Find Houses, Educating Property Investors and We Find Finance, Paul provides valuable, independent guidance and support by teaching strategies on how you can invest successfully while protecting yourself from the mistakes that prevent investors from reaching their goals.