TwoWheels said:
- Pay interest repayments & invest the difference.
Can you show us the figures that illustrate how this is likely to happen please?
- in four years there should be sufficient funds for deposit on 2nd property.
Have you compared it to other alternative investment possibilities? What are your investment goals and timeframes? Would you be concentrating mainly or solely in property? Have you crunched the numbers to see how viable this strategy might be? Are you aware of the risks of concentrating on a single asset class and geographic region as compred with assembling a more diversified (by asset class, geographic region and risk/reward profile) portfolio? What if property prices fall leaving you in negative equity on the investment properties? Are you assuming that rental income will always cover most or all of the mortgage repayments on all properties?Good plan?
TwoWheels said:Good plan?
Can you clarify precisely on what basis it is a good plan please? Don't forget that past performance is no guide to future returns so just because it was a good plan for the last six years does not, of itself, mean that it is a good plan going forward.JohnnieKippe said:Yes I think it is a very good plan. I have been doing similar for the last 6 years or so and its working so far.
doberden said:there will have to be a correction at some stage!!
doberden said:...there will have to be a correction at some stage!! Not likely in Ireland for the next couple of years but there's one coming!
sorry, i am completely missing the point/idea....TwoWheels said:So the idea is roughly as follows.
Good plan?
- Get a mortgage & buy a house to be your home.
- Interest only repayments.
- Pay interest repayments & invest the difference.
- in four years there should be sufficient funds for deposit on 2nd property.
- Repeat interest only option & rent out house #2
- Within 2.5 years, savings from house #1&2 should yield deposit for 3rd house
- Repeat etc.
JohnnieKippe said:Yes I think it is a very good plan. I have been doing similar for the last 6 years or so and its working so far.
bacchus said:When do you repay the capital?
bacchus said:Johnnie,
Can you please explain/quantify your "its working so far"?
How many houses have you managed to buy in 6 years?
Nobody knows.noelk said:how much will the value of property fall?
People should distinguish between Devil's Advocacy and critical analyses of/challenges to proposed property investments (often from people with little or now appreciation of the issues involved or the possible alternatives) and simply negativity. In many cases people read the former as if it was necessarily the latter...why all the doom and gloom about property on this site?
Senior officials from the OECD and the Central Bank recently accepted that the Irish property market is overvalued by 15pc, according to a confidential account of their meeting produced by the Paris-based body.
Central Bank officials, however, were reluctant to disclose such a figure in case it might destabilise the Irish property market, the Irish Times reports.
At a meeting of senior officials from the Organisation for Economic Co-operation and Development and the Central Bank on the subject of the property market, Irish officials were told of OECD research that suggests that Irish prices were 15pc overvalued.
The memorandum notes that senior Central Bank officials agreed with the judgement.
The think-tank represents 24 of the world's leading economies, including Ireland. It conducts in-depth studies of a range of policy topics and issues policy advice to its member states.
The views of the OECD and the Central Bank are recorded in a memorandum summing up the preliminary conclusions of the next Economic Survey of Ireland, which is due to be published officially in January.
Originally Posted by JohnnieKippe
You can sell after say five years, pay off the mortgage, pay your tax and enjoy your profits.
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