1. You can't just multiply 70k by 7. You hit serviceability ceiling by the time you hit the second or third... 2. The types of properties you are looking at are likely extremely high risk, you don't get high yield and high growth. There's a reason why they're high yield. 3. Your yield also does not take into account vacancy rate. Overall, what you are proposing is quite dangerous and can get people into serious trouble.
Hey John, it’s the exact strategy that I’ve used to grow my wealth. It’s not risky when you know where to buy and where to buy is an area that has a diverse economy as well as massive demand which outstrips supply. I’m not here to convince anyone but, vacancy rates in these areas are less than 0.5% which is much lower than all capital cities. By generalising that these types of properties are high risk is not really taking into account the real numbers and fundamentals that are looked at when researching for these properties. This strategy might not be for you but that’s okay, I appreciate you sharing your thoughts 👍🏽
@@PersonalFinancewithRaviSharma I have no doubt that you have succeeded in doing so and congratulations too. It is possible if you are on a high income to support your borrowing. Otherwise, if this strategy is generally available to all, then people can just replicate this indefinitely. For most people, sooner rather than later the borrowing ceiling will be hit.
@@johnwu3593 Thanks John! Yes, you are correct. Most people will: a) never take this strategy up because they are stuck in the old ways of investing in areas they are familiar with only. b) they don't have a high enough income that keeps going up as you go along the journey of investing c) Most will never look at alternative ways to generate extra passive income. This video is a good guide of what is actually possible when someone looks outside of what's written in older books about investing in negatively geared properties etc. Thank you for watching and sharing your thoughts :)
@@PersonalFinancewithRaviSharma Your portfolio is impressive, but I assume you're on a mid to high six figures income. My question is would it be possible for someone on a $50k salary?
The more likley senario would be to use your own home's equity and buy a few houses then a few years later use the equity in all your homes to get more. You just have to be patient.
This whole scheme presumes the following, 1. You have parents. 2. You have parents with equity. 3. Your parents actually care for you enough to let you tap their equity. 4. You are financially stable & responsible enough to take this whole scheme to your parents without them laughing at your face. I am just kidding, kuddos for breaking it down, really helpful thanks.
Then theres the question of borrowing capacity. Someone starting out - although you can put down the deposits - its not to say the banks will just give you the remainder if you cant service the loans 🤷🏽
I have the following questions: How do you get property that allows you to earn more than what you pay in your mortgage? It sounds like you are suggesting to take interest only loans which rely in banks refinancing you forever, what will you do if the banks does not want to? I wonder how are all these people who bought a lot of houses doing right now with the amount of interests they are paying? Are banks still refinancing them? Also those 1.9 millions are debt. Are the banks willing to lend that much to the same person? I would imagine they would look into their salary. I think those repayments look very low for a 1.9m loan. Are there houses out there in Australia that are $250k ?? Also, Would the owners of these properties actually be selling them at less than their actual market value? I think there are a lot of assumptions in this video. I haven’t bought any property yet but I think I am good with numbers.
Hi Ravi, Are you excited for the new "lending laws" ? Especially for the older Ausies who need to make up for lost time and planning? Please tell us. Thank you for all your hard work.
Hi Vanessa, thanks for commenting! Yes, OMG for sure! Super exciting stuff - here are my thoughts on the new changes - ruclips.net/video/OpZW7wBMrk0/видео.html
Great video! I've been thinking about getting into property, but how risky do you think this is though? I'm worried that in a situation where my parent's property is used as collateral, if I'm not able to make the repayments because the property remains vacant for a long period - that their livelihood will suffer, if it gets to a situation where the bank needs to repossess and the value of the property drops.
Hi Arun, that's where it's essential you have a professional Buyers Agent assist in finding these properties. We look at regional centres and greater cities that provide low vacancy rates with cash flow positive positions. Additionally, the fundamentals in these locations are primed for long term capital growth. This ensures that you have a steady, strong income to repay your debt. Additionally, we focus on bringing value to our clients so buying under market value will act as another risk mitigation tool. Drop us an email and I can provide a review of your position. ravi@searchpropertyau.com
@@PersonalFinancewithRaviSharma Great Stuff! one thing please help me understand do you think that those repayments are going to be covered by rent only ( 4% or 5% yield ) example - 500 k apartment having a 450 $ rent.
Hey Ravi before you’re allowed to draw that equity, will banks look at your serviceability? Or are you saying they will automatically approve irregardless of what your yearly income is
All very interesting, but this is technically doable if your salary is already somewhere around 400k per year.. due to the serviceability factor.. right?
@@marcorider88 Not necessarily. Obviously comes down to alot of factors including income but, depending on what the rentals look like from the properties and which bank you go to as they could sometimes use 70% of the rent in calculations or 80%
Hi Ravi. Would this type of equity loan be the same as taking a loan split if I was taking equity from my existing mortgage as opposed to my parents property?
Hi Ravi! Im still in university (unsure if my student debt will play on with using my parents equity) i just want to know if this is possible for me to do this. Thank you so much for your advice.
Hi Ravi, I'm looking at places in large regional cities in VIC and $350/w rent on a $250k property doesn't seem conservative at all. Is this just due to the recent boom?
I live in one of those areas but it’s a mining town . My house $260k can be tenanted for $460 a week. When mining goes down though no tenants available
This is not true that you can purchase 7 properties. The bank will not lent you money. I have my business and have good income, but still can't borrow anything
I don't think bank will allow you to take a loan for 7 properties with just a meager salary, if you have high salary then you don't need your parents money
we need an update pls :) cheapest in my area is 500k. i have 260k saved and an I.P. positively geared. i'm retired and banks won't let me borrow against my own IP house!?? my income at the moment is 26k super pension and 20k rent. the wife makes about 40k. i'm 48.
hi there good video and channel!! $250k home with $350 rent can you list a few suburbs with this return. I'm from VIC and for regional homes you can buy for under $250k but rent is around $200 - $250
Hey Robbie, thanks for watching and engaging bud. These areas we are targetting are for clients so can't be specific about them but they are out there for sure. With low stock levels, it's harder to find though
Hi Ravi, quick question. I’m 22 but always been focusing on my future and for about 4-5 years I’ve had this plan to leverage debt to build a portfolio like yours using debt. But after realizing my potential income with my career path could be around 200k plus salary. Would you recommend someone do it the debt free way if they could afford it ? Or even if you make $200,000 a year would you recommend them to leverage debt. Before I thought I could never afford to buy a house debt free within a few years so I always thought leveraging debt was the way to go. But now that I’m graduated and seeing I’m on my way to a good salary with my career. What would you recommend?
Obviously I would need to know your goals and strategy before advising however, my question is - why buy 1 asset debt free when you could have multiple assets that produce positive income? In turn, which would you prefer, an asset base of $200k or $1M? 💰💰
@@PersonalFinancewithRaviSharma Im in the process of buying again after loosing a few and selling a few over 30years.I have heaps of equity in my own home but dont earn what i use to
Hi Ravi, I’d love to make a time to chat, my mum is in a very good financial position with a few properties, my partner and I have just brought our first property but I’m already thinking about the second one. Let me know how free you are. Regards Dylan
It’s easy to say 2000 $ income and have a paid off house but not a lot of young people have them and besides no broker can approve if you don’t show any increase in your income to. Get approval for your investment property
Totally agree on the fact that without an increase in income, it will be very difficult to continue taking on more debt. This example is to more so showcase at a high level of what is possible if one did have increasing income levels. It's just an example and some will be able to achieve results greater than this and some that won't. Hope that helps :)
Hey Rick, this is an older video so is probably why it still references a "Free session". The complimentary sessions were only available for a short period and now is a paid service for $299. Hope that makes sense :)
Thanks for the question! Servicing a loan will really come down to your personal stituation so if you would like us to have a look, shoot me an email and we can see what is possible with different debt structures ✌️ ravi@searchpropertyau.com.au
I'm in this same situation and want to do exactly this?how do I go about chatting to you and get the ball rolling😊.Although I purchased the property off my parents or my mother as father passed.So I am in a position of having 500k plus equity from the valuation of the property to what I paid .Love to start my investing portfolio ,id love your help and mentoring😊
Hey Jon, I'll be honest - I'm not too familiar with this however, best place to start would be to speak to a mortgage broker that is based in Australia and then an Accountant to see the tax implications :)
@@PersonalFinancewithRaviSharma I have watch so many of your videos and you have given me so much knowledge in such short time. I am looking for my second property wish me the best.
@@PersonalFinancewithRaviSharma do you really need to push your 'buyer agency' so much aswell? thats obviusly the real reason for any content to earn % of commis bc clearly you have no idea as shown here. adding countless ads is insult to injury. ahahahahahahah
100% impractical and impossible in Sydney. Show me a property worth $250k yielding 350/week. In Sydney, you won't get even a studio apartment for $250k
@@soundforheal8538 but I think in his other video he used the same logic for Sydney. Not sure if it's Sydney Australia or Sydney, Canada..hahaha. BTW 350/pw rent on 250k investment.. I am investing in USA now if that's true ;-)
1. You can't just multiply 70k by 7. You hit serviceability ceiling by the time you hit the second or third...
2. The types of properties you are looking at are likely extremely high risk, you don't get high yield and high growth. There's a reason why they're high yield.
3. Your yield also does not take into account vacancy rate.
Overall, what you are proposing is quite dangerous and can get people into serious trouble.
Hey John, it’s the exact strategy that I’ve used to grow my wealth.
It’s not risky when you know where to buy and where to buy is an area that has a diverse economy as well as massive demand which outstrips supply.
I’m not here to convince anyone but, vacancy rates in these areas are less than 0.5% which is much lower than all capital cities.
By generalising that these types of properties are high risk is not really taking into account the real numbers and fundamentals that are looked at when researching for these properties.
This strategy might not be for you but that’s okay, I appreciate you sharing your thoughts 👍🏽
@@PersonalFinancewithRaviSharma I have no doubt that you have succeeded in doing so and congratulations too. It is possible if you are on a high income to support your borrowing. Otherwise, if this strategy is generally available to all, then people can just replicate this indefinitely. For most people, sooner rather than later the borrowing ceiling will be hit.
@@johnwu3593 Thanks John! Yes, you are correct. Most people will:
a) never take this strategy up because they are stuck in the old ways of investing in areas they are familiar with only.
b) they don't have a high enough income that keeps going up as you go along the journey of investing
c) Most will never look at alternative ways to generate extra passive income.
This video is a good guide of what is actually possible when someone looks outside of what's written in older books about investing in negatively geared properties etc.
Thank you for watching and sharing your thoughts :)
@@PersonalFinancewithRaviSharma Your portfolio is impressive, but I assume you're on a mid to high six figures income. My question is would it be possible for someone on a $50k salary?
@@johnwu3593 no, I guess 😂
The more likley senario would be to use your own home's equity and buy a few houses then a few years later use the equity in all your homes to get more. You just have to be patient.
Dam that was bad financial advice on interest rates not rising
This whole scheme presumes the following,
1. You have parents.
2. You have parents with equity.
3. Your parents actually care for you enough to let you tap their equity.
4. You are financially stable & responsible enough to take this whole scheme to your parents without them laughing at your face.
I am just kidding, kuddos for breaking it down, really helpful thanks.
hahah started reading it and thinking oh dear another hate comment. I appreciate the humor LOL :)
3 & 4 are the biggest problem 😂
@@jadedFk I know right.
If you got desi parents that equity only coming out for your marriage 😂
@@MB-xw8ir Yep, have desi parents, that equity's taken out already for marriage.
Hi Ravi Calculation seems wrong first you were talking about 500k equity means borrowing capacity later in a vid you endup buying 7 property??
This only would work if you have a loan capacity of 1.4m
Then theres the question of borrowing capacity. Someone starting out - although you can put down the deposits - its not to say the banks will just give you the remainder if you cant service the loans 🤷🏽
9:00 that didn’t age well 😅
I have the following questions: How do you get property that allows you to earn more than what you pay in your mortgage? It sounds like you are suggesting to take interest only loans which rely in banks refinancing you forever, what will you do if the banks does not want to? I wonder how are all these people who bought a lot of houses doing right now with the amount of interests they are paying? Are banks still refinancing them? Also those 1.9 millions are debt. Are the banks willing to lend that much to the same person? I would imagine they would look into their salary. I think those repayments look very low for a 1.9m loan. Are there houses out there in Australia that are $250k ?? Also, Would the owners of these properties actually be selling them at less than their actual market value? I think there are a lot of assumptions in this video. I haven’t bought any property yet but I think I am good with numbers.
Hi Ravi,
Are you excited for the new "lending laws" ?
Especially for the older Ausies who need to make up for lost time and planning?
Please tell us.
Thank you for all your hard work.
Hi Vanessa, thanks for commenting! Yes, OMG for sure! Super exciting stuff - here are my thoughts on the new changes - ruclips.net/video/OpZW7wBMrk0/видео.html
Great video!
I've been thinking about getting into property, but how risky do you think this is though? I'm worried that in a situation where my parent's property is used as collateral, if I'm not able to make the repayments because the property remains vacant for a long period - that their livelihood will suffer, if it gets to a situation where the bank needs to repossess and the value of the property drops.
Hi Arun, that's where it's essential you have a professional Buyers Agent assist in finding these properties. We look at regional centres and greater cities that provide low vacancy rates with cash flow positive positions. Additionally, the fundamentals in these locations are primed for long term capital growth. This ensures that you have a steady, strong income to repay your debt. Additionally, we focus on bringing value to our clients so buying under market value will act as another risk mitigation tool. Drop us an email and I can provide a review of your position.
ravi@searchpropertyau.com
@@PersonalFinancewithRaviSharma Great Stuff! one thing please help me understand do you think that those repayments are going to be covered by rent only ( 4% or 5% yield ) example - 500 k apartment having a 450 $ rent.
Hey Ravi before you’re allowed to draw that equity, will banks look at your serviceability? Or are you saying they will automatically approve irregardless of what your yearly income is
Hey Manny, yeah they will look at servicing before they even allow you access that equity
All very interesting, but this is technically doable if your salary is already somewhere around 400k per year.. due to the serviceability factor.. right?
@@marcorider88 Not necessarily. Obviously comes down to alot of factors including income but, depending on what the rentals look like from the properties and which bank you go to as they could sometimes use 70% of the rent in calculations or 80%
Hi Ravi. Would this type of equity loan be the same as taking a loan split if I was taking equity from my existing mortgage as opposed to my parents property?
Hi what di you think of ndis and co living positive cashflow? Do you buy those too? ThNkz
Hi Ravi! Im still in university (unsure if my student debt will play on with using my parents equity) i just want to know if this is possible for me to do this. Thank you so much for your advice.
Hi Ravi,
I'm looking at places in large regional cities in VIC and $350/w rent on a $250k property doesn't seem conservative at all. Is this just due to the recent boom?
Hi Ravi,
I am looking where to buy this $250k property with $350/week rental please.
Thanks
Nice one
I’d like to know where in Australia you can buy a property for 250k and get $350 a week rent from it?
I live in one of those areas but it’s a mining town . My house $260k can be tenanted for $460 a week. When mining goes down though no tenants available
love the content, what would the first steps be for someone wanting to start in property investment with nothing? i own nothing, no deposit yet?
Where do you buy a property for 250K??… Antartica??
Does this then mean my parents have no equity left in their house to use themselves?
Loved the video.But would have been easier to understand the concept considering one property as an example instead of 7 properties
Thank you! That's great feedback, I'll make note to make a more in-depth video about this concept with 1 property as the example :)
Great video Ravi
Thanks a ton
This is not true that you can purchase 7 properties. The bank will not lent you money. I have my business and have good income, but still can't borrow anything
It is possible. Just need to know how to structure debt properly. Plenty of investors out there that have done this :)
@@aulzhoefer They do but, it's not impossible to still grow a portfolio of this size and bigger.
What about serviceability of the loan??
i just did this for my latest home and they called it my parents as "guarantors"
I don't think bank will allow you to take a loan for 7 properties with just a meager salary, if you have high salary then you don't need your parents money
we need an update pls :) cheapest in my area is 500k. i have 260k saved and an I.P. positively geared. i'm retired and banks won't let me borrow against my own IP house!?? my income at the moment is 26k super pension and 20k rent. the wife makes about 40k. i'm 48.
hi there good video and channel!! $250k home with $350 rent can you list a few suburbs with this return. I'm from VIC and for regional homes you can buy for under $250k but rent is around $200 - $250
Hey Robbie, thanks for watching and engaging bud. These areas we are targetting are for clients so can't be specific about them but they are out there for sure. With low stock levels, it's harder to find though
Some of the cheapest suburbs in Perth would offer you this.
hey mate are you in sydney?
Sure am! :)
That person would be screwed at the moment. Probably negative $100 a week on each property
Hi Ravi, quick question. I’m 22 but always been focusing on my future and for about 4-5 years I’ve had this plan to leverage debt to build a portfolio like yours using debt. But after realizing my potential income with my career path could be around 200k plus salary. Would you recommend someone do it the debt free way if they could afford it ? Or even if you make $200,000 a year would you recommend them to leverage debt. Before I thought I could never afford to buy a house debt free within a few years so I always thought leveraging debt was the way to go. But now that I’m graduated and seeing I’m on my way to a good salary with my career. What would you recommend?
Obviously I would need to know your goals and strategy before advising however, my question is - why buy 1 asset debt free when you could have multiple assets that produce positive income? In turn, which would you prefer, an asset base of $200k or $1M? 💰💰
But this all depends on your weekly wage,as the bank needs to know if you can service it
Correct. It’s why I mention it comes down to income and servicing :)
@@PersonalFinancewithRaviSharma Im in the process of buying again after loosing a few and selling a few over 30years.I have heaps of equity in my own home but dont earn what i use to
Hi Ravi,
I’d love to make a time to chat, my mum is in a very good financial position with a few properties, my partner and I have just brought our first property but I’m already thinking about the second one.
Let me know how free you are.
Regards
Dylan
It’s easy to say 2000 $ income and have a paid off house but not a lot of young people have them and besides no broker can approve if you don’t show any increase in your income to. Get approval for your investment property
Totally agree on the fact that without an increase in income, it will be very difficult to continue taking on more debt. This example is to more so showcase at a high level of what is possible if one did have increasing income levels. It's just an example and some will be able to achieve results greater than this and some that won't. Hope that helps :)
Dude how do I get a hold of you? I’m an investor
This is a bit confusing. What about your borrowing capacity?
Hey Ravi, it seems the 'free' strategy session is $299? Which is it?
Hey Rick, this is an older video so is probably why it still references a "Free session". The complimentary sessions were only available for a short period and now is a paid service for $299. Hope that makes sense :)
is there a way to do this without having parents home?
Great break down, although it is a little difficult to see the break down on the board.
Noted :) Hopefully the newer videos on the channel are easier and more clear :)
Personal Finance with Ravi Sharma Yeh they sure are 🙏 how much is a strategy session and how long is the wait currently?
@@lukeburrows7144 I have a few sessions available as early as next week :) You can find more details here - www.searchpropertyau.com.au/contact-us/
@@lukeburrows7144 $399 and you can book a session for as early as next week :)
How about Serviceability? How to borrow 1.4m to service this loan. Please reply to this :)
Thanks for the question! Servicing a loan will really come down to your personal stituation so if you would like us to have a look, shoot me an email and we can see what is possible with different debt structures ✌️
ravi@searchpropertyau.com.au
How much of an income would you need to make to have this plan ?
I'm in this same situation and want to do exactly this?how do I go about chatting to you and get the ball rolling😊.Although I purchased the property off my parents or my mother as father passed.So I am in a position of having 500k plus equity from the valuation of the property to what I paid .Love to start my investing portfolio ,id love your help and mentoring😊
Please email me on ravi@searchpropertyau.com.au :)
Thank you
Solid advice and self promo😅
Mum said no.
That for sharing this valuable information 👌👌👌
Thank you Zac! Appreciate it :)
Hi Ravi, is it possible to to use equity in my NZ house, to buy property in Aus, I live in Aus?
Hey Jon, I'll be honest - I'm not too familiar with this however, best place to start would be to speak to a mortgage broker that is based in Australia and then an Accountant to see the tax implications :)
Hey ravi, but the question is how do we get our parents equity if they are not working bank wouldnt lend it to them as they are not working ?
Yes I believe that is correct. Might be worthwhile having a chat with your mortgage broker for options :)
@@PersonalFinancewithRaviSharma I have watch so many of your videos and you have given me so much knowledge in such short time. I am looking for my second property wish me the best.
@@roseyjojo That's awesome! Glad you are enjoying the content and acting :) All the best for the next purchase!
Do you really need to include 6 adverts......?
Do I really need to put out free content?
@@PersonalFinancewithRaviSharma do you really need to push your 'buyer agency' so much aswell? thats obviusly the real reason for any content to earn % of commis bc clearly you have no idea as shown here. adding countless ads is insult to injury.
ahahahahahahah
@@seanc758 All of his videos are like this. Just self praise ads and nonsense.
Does this work if your parents own the house outright and don’t have a loan to draw off?
Yeah it should, as long as they have income to take on the debt
can you get an equity loan without a jo?
Not from a bank unfortunately
“How to buy propriety” = “use your parents money”
Ravi is this still relevant today?
Well done Ravi, great breakdown!!
Thank you Adrian! Appreciate the support :)
@@PersonalFinancewithRaviSharma mate I think your website is down atm.... can’t access it from my iPhone
Unfortunately my parents don’t have a 1M home 😭
That's okay, we need to ensure your kids don't say the same about you 🙌 Action is key 💰
If rates double portfolio dies.
where did you get a property for 250k and get 350 rent pw lol
100% impractical and impossible in Sydney. Show me a property worth $250k yielding 350/week. In Sydney, you won't get even a studio apartment for $250k
You haven’t watched the video my friend ,he ain’t talking about property of Sydney he is talking about Texas property 🤓
@@soundforheal8538 but I think in his other video he used the same logic for Sydney. Not sure if it's Sydney Australia or Sydney, Canada..hahaha. BTW 350/pw rent on 250k investment.. I am investing in USA now if that's true ;-)