Download - Free Guide Big Profits in Real Estate
-
8/11/2019 Free Guide Big Profits in Real Estate
1/9
BIG PROFITSIN REAL ESTATE
STEPHEN McCARTHY
HOW TO BUILD YOUR
PROPERTY INVESTMENT PORTFOLIOFOR AS LITTLE AS $15A DAY
CEO, McCARTHY GROUP
-
8/11/2019 Free Guide Big Profits in Real Estate
2/9
THE SECRET IS UWith our growing population,
affordable land supply choked off,
and the rising cost o construction
materials, it could well double again in
the next ten years. Tis ever-increasing
value is your equity, and we call it your
sleeping money.It sits right under your eet, and i
harnessed correctly, it has the potential
to set you on the path to financial
reedom. Te secret to making real
money in property investment begins
by knowing how to use the equity that
exists in your own home.
TIMES HAVE CHANGED
O course hindsight is a wonderul
thing, but imagine how much equity
youd have today i you had bought two
properties when you started out? At
the time, the bank or building society
probably wouldnt have lent you the
money that you needed.
Tankully, this has now changed. In
act, banks are now eager to help you
own a second home because:
the rental income rom residential
properties can service its mortgage;
over the medium to long term,
Welcome to the Big Profits in Real
Estate guide. I am delighted that
youve taken this important first step,
and have begun to seek inormation
on how to build your property
investment portolio.
Creating and growing your ownportolio is a major step towards
financial independence. Although
you might think that building your
portolio with as little as $15 a day is
not possible, let me assure you that it
iswhen you know how.
Tis booklet describes how the
equity in your home can be leveraged
to provide you with an asset to assist
you in becoming financially inde-
pendent, and maintain your standard
o living well into retirement.
WHAT EXACTLY IS EQUITY?For most Australians their wealth
is tied up in the value o their own
home due to growing property
prices. Look at your own home
and youll know this is not a recent
phenomenon. Chances are that i you
have had it or ten years or so, it has
approximately doubled in value.
NDER YOUR FEETproperty values continue to rise;
and
ew things are as sae and secure as
residential bricks and mortar.
INVESTMENT PROPERTYWITHOUT A CASH DEPOSIT
As a homeowner or mortgage holder,
you have already done the hard work
through saving or your deposit and
building the equity in your home. Tis
is why purchasing a second property
is ar easier than you might think. And
owning two or more could financially
set you up or lie.
Flushing the equity in your own
home helps you to kick-start your
property investment portolio. It
allows you to invest in property
without the need to come up with a
cash deposit.
Tere are however many other
opportunities available to you through
this equity. An investment portoliocan, in the short term, reduce your tax
bill and move you towards becoming
mortgage ree. In the long term, it
can provide you with the security o
financial reedom.
For over a decade the McCarthy
Group team have been dedicated to
helping our clients achieve big profits
in real estate. Tis opportunity is now
available to you.
MichaelJohnsonHead o
McCarthyGroup
Financial
WayneWandersGeneral
Manager
StephenMcCarthy
CEO
-
8/11/2019 Free Guide Big Profits in Real Estate
3/9
OWNING YOUR SEIS EASIER THA
Many people are amazed to learn that
it is ar easier to own a second property
than it is to own the first. Tey believe
that its hard enough meeting the
existing mortgage payments on their
current home, let alone thinking about
how they could afford a second one.
Te truth is you wont be paying
off the second mortgage by yoursel.
Unlike your own property, where you
have to make one hundred percent
o the payments, your tenant will
contribute approximately hal o the
cost o the mortgage repayments.
Te tax office will then cover about
a quarter o the costs in tax rebates.
Which means that you only have to
und the difference. Reer to Diagram
I, on opposite page.
WHY DOES THE TAX OFFICE GIVE
YOU TAX BREAK S?
Te government makes these generous
concessions available because it has
decided that private investors are the
preerred suppliers o rental property.
Tis also takes the pressure off the
government to provide housing.
Consequently, many years ago the tax
HOW DO THE NUMBERS WORK?
Purchase price including costs $430,000
Outgoing
Mortgage payments $25,500Running costs 8,000
Total $33,500
Incoming
Rental $19,000ax breaks $9,500Total $28,500
Shortfall $5,000
Weekly $96
Daily $14
Assumptions
Interest rate 5.92%Interest only
Running costs include rates, propertymanagement, insurance, maintenance, etc.Rental assumes property rented or 48 weeksFigures have been rounded
office worked out a plan to incentivise
private property investment, loosely
described as negative gearing.
WHY INVEST?
Whilst there are requent media
reports calling or the government
to scrap these incentives, successive
governments have continued to reject
these calls as the principles or these
tax incentives remain strong.
Tere are many reasons why people
like yoursel decide to buy a rental
investment property. Some want
to retire early. Some are motivated
or tax reasons. Others just want toenjoy the eeling o creating wealth
or themselves over and above their
regular income.
However, most people only make
a move when they discover how little
money theyll receive through normal
channels when their working days are
eventually over.
COND PROPERTYN YOU THINK
Other
Invest forRetirement
ReducibleTaxableIncome
ObtainIncomefromRent
Secure Long-term
Investment
YouTaxman
Tenant
5
Diagram I:Who pays the second mortgage?
Diagram II:Why do people invest in property?
-
8/11/2019 Free Guide Big Profits in Real Estate
4/9
KEEP YOUR MONEAFTER YOU H
Did you know that the majority
o retirees in Australia are bitterly
disappointed with their level o
income?
Whether its rom superannuation
or the pension, or a combination o
both, it provides or a meagre income.
Unortunately many dont discover
this truth until its too late to do anything
about it. And it is widespread, affecting
both white and blue-collar employees.
I you were to find yoursel in this
situation, you can say goodbye to having
private healthcare, or private motor
vehicle ownership, or helping out your
kids. Tere will be no more luxuries.
YOU HAVE A CHOICE
How much money will you need to live
comortably once you stop working?
Lets work backwards. Assuming a
reasonable $40,000 a year beore tax,
and a conservative return on your
investment o 5 percent, how much
capital would you need to generate
earnings o $40,000 per annum? Te
maths is simple: $800,000.
NEVER SAY NEVER
Youre probably thinking, We could
never save $800,000. But beore you
dismiss the idea, just think about the
value o your own home. Chances are
Katrina & Dennis GhettoMcCarthy Group ClientsSince 2005
Y WORKING LONGAVE STOPPED
that i you bought it ten years ago or
around $250,000, it could be worth
$500,000 today.
Te most recent available figures
rom the ABS show that in the last
ten years, the median house price o
the eight capital cities has grown at an
average rate o 8.9 percent per annum.
At that rate, it doesnt take long or a
property to double in value. I you kept
a property thats now worth $500,000
or ten years, it could then be well
worth $1 million.
So, why not do this with more than
one property? And thats the secret o
property millionaires. It is the simplest
and easiest way to profit through
property investment. Buy and hold.
LEVERAGE AND TIME ARE THE KEYS
Te secret to building wealth is using
the equity that you have already built
up in your property to assist you to
invest in an asset that appreciates in
value. Lending or property is the
avoured orm o lending or banks
and building societies. Tis is why
they place billions o dollars in the
property market each year.
BANKS WILL HELP
Provided that you have a regular
income, have sufficient equity, and a
good credit history they will lend you
up to 100 percent or more o the value
o the selected property or a period o
25 to 30 years. Once that property has
increased in value, you may well be in
a position to repeat the process. But
most people only ever buy their first
home and then stop.
At retirement, you may well be
surprised that your house is now
worth one million dollars. With
hindsight this could easily have been
turned into two properties worth two
million dollars.
Te sooner you act; the sooner you
can achieve gains. So, dont wait to buy
property, buy property and wait!
7
-
8/11/2019 Free Guide Big Profits in Real Estate
5/9
PAY OFF YOUR HOMINVESTMENT PR
Many people still believe that they
should wait until their house is paid
off beore buying another. Tats called
conventional wisdom.But times change and so do
conventions. oday the bank will lend
you the money to buy an additional
property while you pay off the first
one. Tis means that you can hold two
properties at the same time, and enjoy
the compounding value increase on
two properties rather than one.
Once their homes have doubled
in value, many couples then think
outside the square and sell the
investment property and pay off their
original home mortgage. We call this
approach back burning and it is
highly effective in creating a mortgage-
ree result.
TIME IS RUNNING OUT
One o the key ingredients in the
recipe o successul investment is
time. You need time to let asset values
and rentals grow.
Te longer you leave the decision,
the less time you have to reap its
benefits. And i you are not careul,
you may reach the point o no return,and ace the kind o unsatisactory
retirement being experienced by
many Australians today.
You need to make sure that when
your work stops, your income doesnt.
And the only way to do that is to
develop a sound investment plan, and
act upon it.
ITS COMMON SENSE
Youll kick yoursel i you ever come
to realise that there was a solution.
A solution that enabled you to retire
in relative comort, with financial
reedom and independence, and you
simply never discovered it.
Please keep an open mind, and
understand that Im not asking you to
do anything that doesnt come with a
good dose o common sense. I you
do nothing about the uture, you will
most likely end up going broke.
E LOAN WITH YOUROPERTY PROFIT
9
Living on an income equivalent to
the dole means you are broke. And
i you want to avoid this situation,
then you might as well give yoursela fighting chance and create a Plan B.
HOW DO I DO IT?
For many people the starting point
has been our Plan BWorkbook. Its a
simple guide with five key pillars. It
starts out by helping you to calculate
where you are right now in terms o
your current assets and income, and
where you are likely to end up using
your current projections.
You then work out how much
income youll need to retire in the
kind o liestyle that youve enjoyed
while working, and that you plan
to continue to enjoy once youve
stopped.
Te workbook is essentially a
roadmap o the path to investment
success, leaving you with a clear
picture o what you need to do to take
control o your uture.
Would you like to get a sneak
preview o how your financial world
will look in twenty years time? Im
sure you already know where youwant to go, but can you figure out how
to get there with certainty?
Our associates can walk you through
your financial uture, and map it out
or you so you can see clearly where
you are today, and how you can retire
without money worries.
Lynne & Ray SpicerMcCarthy GroupClients Since 2010
-
8/11/2019 Free Guide Big Profits in Real Estate
6/9
L TOGETHER
PLAN B FOR RETIREMENT
PILLAR 3:SUPERANNUATION
Te question everyone asks is how
much will my superannuation be
worth on retirement, and will it
provide me with sufficient income?
Teoretically, your biannual state-
ments should answer these questions.
However, or most o us these
statements are indecipherable. Tere
is unnecessary complexity and general
uncertainty on what it will provide,
and upon working it out, many people
are underwhelmed.
Plan B will show you accurately
and in laymans terms what income
your superannuation will deliver to
you when you need that money.
PILLAR 4:ASSETS
For most people their biggest asset is
their own home ollowed by the value
o their superannuation und. But will
they generate enough income or you
to stop work comortably?
Te amily home could be a source
o income but there are no guarantees.
You will always need somewhere to
live. What Plan B looks at is what
assets you currently have to give you
an income stream when you stop
work, and what other assets you canput in place to help build your income
or the uture.
PILLAR 5:INCOME
Understanding what income you need
is critical, as is adjusting it or inflation.
It is a sad act that most financial
commentators overlook the corrosive
effect o inflation on income.
CREATING YOUR PLAN B
Te benefit o having the Plan Bis that
it puts all o that inormation together
so you can say, Tis is the area or
my mortgage, my tax, my assets, and
my superannuation, and see how
inflation plays a role in all o that mix.
So, let us help you build your own
Parthenon by making sure all o your
five pillars are working in harmony to
help you enjoy your standard o living
in retirement.
11
-
8/11/2019 Free Guide Big Profits in Real Estate
7/9
BUILD YOUR PROPPORTFOLIO F
Media HypeMore Buyersthan Sellers
Shortage ofTradespeople
ValuationsRise
Prices
Rise
Stock LevelsTightening
RentalsIncrease No Confidence
More Sellersthan Buyers
ValuationsFall
Abundance of
Tradespeople
FallingConstructionPrices
StockOversupply
AffordabilityCrisis
Low Rental YieldsHigh Confidence
Boo
m
Recove
ry Slum
p
SlowD
own
Buyers Market
Sellers Market
PROPERTY INVESTMENT CYCLE
ERTY INVESTMENTOR $15A DAY
Ive ound that most people dont
need to spend a ortune to create an
investment portolio. Plan B can be
your guide - it is your back up plan or
your financial reedom.
o have a second property, on
average its an investment o $15 per
day with good rental returns and tax
benefits. Tats not much really when
you consider that a couple o cups o
coffee and a sandwich in a ca will
cost about $15.
$15A DAY
CAN MAKE A BIG DIFFERENCE
Right now youre probably thinking
that $15 a day wont impact you or
your liestyle choices in retirement.
However, it can make a significant
difference and allow you to retire
without any money worries.
Its all about choice. I youre
prepared to give up a couple o cups
o coee a day, then you too can
set up your retirement that many
others only dream about.
SO WHY ACT NOW?
Most things in lie, including
something as amiliar as breathing,ollow simple cycles. Countless times
every day you breathe in, pause,
and exhale. Tese unctions happen
automatically. A similar progression
is true or the property market.
Currently the property market is
generally considered to be in a pause
stage. Tis is normal. Its not negative,
or badit just is! Within the market
cycle, prices cannot consistently
rise without a pause, nor can they
all indefinitely. In between these
two extremes, the market slows and
readjusts beore rising once more.
Such patterns have been in place
since time immemorial. Plan B will
show you how you can increase your
assets by entering the market at the
right part o the cycle. Tere could
not be a more opportune time or
you to inquire urther and enter the
market than right now.
13
-
8/11/2019 Free Guide Big Profits in Real Estate
8/9
ACT NOW WHILE THI urge you not to put your decision
off any longer. Make the first move
towards becoming one o the thousands
o investors whose lives have been
changed orever through
Another great investment property by
Investment Property Central, a division o McCarthy Group
discovering Big Profits in Real Estate.
For a ree consultation with absolutely
no obligation, contact McCarthy Group
today on 1300 850 318, or email Julie at
[email protected]. It could
E MARKET IS DOWN
SEPHEN McCARHY CEO, McCARHY GROUP
be the most valuable call youll ever
make. What do you have to lose?
Tank you or taking the time to
read Big Profits in Real Estate.Please let
McCarthy Group assist you in building
your property investment portolio or
as little as $15 a day!
-
8/11/2019 Free Guide Big Profits in Real Estate
9/9
McCarthy Group Pty Limited ACN 086 284 826
02 9687 3601 / 1300 850 318 / F 02 9687 3610
Building 2, Suite 2.01, 35 Waterloo Rd Macquarie Park NSW 2113
PO Box 42 North Ryde BC NSW 1670
E [email protected] / www.mccarthygroup.com.au
For additional copies o this consumers guide, or another in our series, please contact us at the address below.
PLEASE CALL 1300 850 318VISIT OUR WEBSITE: MCCARTHYGROUP.COM.AU