Vendor contracting his tenant into a mandatory savings plan. This strategy overcomes one of the main disadvantages of vendor financing and installment contracts, as the sale of the property does not take place until the option is actually exercised by the tenant and funds are exchanged...
Rent to Buy or Lease Purchasing Contracts Rent to buy or lease purchasing is contracting to rent a property at an agreed price with a premium paid over and above the normal rental which is called an ‘option fee’. This ‘option fee’ is accumulated over a...
The difficulty with installment contracts Because a sale has actually taken place, Capital Gains Tax is levied on the sale. This causes a problem for the seller as he or she is paying tax on the profit on a sale which he has not yet been...
Vendor Financing and Installment Contracts Vendor financing is when the property is physically sold to the purchaser at the time of settlement of the property, even though (at that time) only a small amount of money has actually changed hands. Additional to the sale and purchase...
Wrapping Wrapping comes in a number of forms. The strategy has originated in America and been adapted to suit Australian laws and culture. Wrapping is also known as: Vendor financing and installment Rent to buy or lease Lease option Technically, this type of purchasing is a little different...
Multiple Stream Income Commercial Property One of my clients only purchases small shopping centres. After many years of investing experience, he’s come to the conclusion that small shopping centres present the least risk, the least hassle and the highest yielding investment for him. Of course, as with...
Difference Between Big Deals and Smaller Deals Remember the difference between a big deal and a small deal is only the number of zeros at the end of the deal. It’s the same amount of work. It’s the same amount of effort. It’s the same structure....
Areas of Demand in Commercial Property When you start having a look at commercial property you can start to maximise the yield from your commercial properties by looking at areas that are in more demand than others. The best way to look at this is by...
A Lag in Commercial Property These are the kind of dynamics you really need to start to take on board now while things are booming. Look at the sustainability of it though. In commercial property what we’ve got now is a lag. Whenever you’ve got a...
Commercial Property Case Study A property on the net is $675,000 and 9.49% ROI based on a 70% loan with 7.5% interest rate, therefore the quick calculation or estimation of the passive income on the property is $13,477. There are no rates because you’re assuming the...