[startxingMember@startxingJoin Date: 2004Post Count: 15]

June 22, 2011 - 6:33 am

HI everyone again ~~

I took the day off and drove down the Liverpool for the 1st time in my life ~ sounds exciting ~~

I follow my GPS and arrived in the area with no traffic, drove pass Westfield, it looks huge ~

Parked the car infront of the vacant land, and suprisingly, there is a project going up right next to it, which only contains 38 units however. Right across the road, it is some brand new Apartments, range from 5 levels to 8 levels I believe, they all look very new to me.

I rang the one just at the opposite of the road that have a For Lease sign outside, the girl told me they have sveral units that is available now, but they are 3 beds, rent starting from $475 per week !! no funiture inside !! 3 bed, $475 per week rent …..

Then I asked how old is this build, she said it is only compeleted couple months ago!

Then I drove around this part of Liverpool and saw a lot of new Apartments in the area, thinking the medium unit price from Investsmart isn't really that close the real market conditions ~ ( just my opinion)

I open my ipad do a quick search for units/apartments for rent in the area, they ranging from $320-370, some goes for $400, all for a 2 beder.

After all that, I park the car in westfield, walk around the area, can't argue with the amount of people traffic flow there, it is like Parramatta, but only bigger. It was during lunch time, people seems friendly ~ no complains ~

I will check out what kind of townhouse/house it is offering in the area next week to make up my mind. Overall, I am satisfied with the place and the price that offered, just don't really think 2+ years is going to be a good factor for wealth creation.

[startxingMember@startxingJoin Date: 2004Post Count: 15]

June 21, 2011 - 2:19 pm

thank you everyone for the feedback!!

Firstly, I just realized there is a lot of writing misktakes in my 1st post

Secondly, I need to explain a bit regarding why I want to purchase a OTP property. The reason being I have invested in a OTP property last year, and it is getting completed within the next 6 months, base on the 2nd sales record so far, I have made a solid 10% growth on a 365k purchase, the suburb is Northmead, which is near parramatta. (of course, before the money is in the pocket, we can't say it is in the pocket yet do we ? )

This liverpool project is from the same agent, but I am not a no brainer, and I can tell there is a big gap between the medium price and the price they are offering, but what is interesting they already sold 70% of them ! I mean I could maybe get it down to 350k, with a 2 + years settlement, but a 100k difference does make me worry………….

As I was facing the same decision when I purchase the Northmead project but the medium price was not much differ back then, so I made the go ahead. However, for this one, I do agree with Steve-w post above, negotiate a good little 2 bedder and get much better return both on capital + rental, coz you can even capitalize on the new units being sold in the area with much higher price !

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 23, 2010 - 3:13 pm

if you have to go with houses…

I can suggest Auburn, easy shopping, transport everything. But 400k can only get you townhouses, which still good~

In the west, you could only try places like Liverpool, Blacktown,

But if you buy units, there are lots of good choices in good suburbs. Such as Parramatta.

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 21, 2010 - 12:27 pm

I didn't read all the above, too many words….

So you have a high income, paying highest rate of tax,
You also have good equity in your PPOR, 80% of 470k is what lender normally let you use = 376k

And you are only 40 only.

Just invest in brand new apartment, in prime suburb (not city area, because lender consider them as high risk), get all your lovely tax back, also you don't need to worry about rent because it is in prime suburb and it is brand new.

Buy as much as you can afford on the weekly payment. Research to do is, how many people go to a open session for rental property in that area? how much tax you getting back? can you borrow the money to buy it?

20 years later, you will be a happy fella without even touching your super at all.

Love to be in your situation~

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 21, 2010 - 12:12 pm

HI, i think you got a bit confuse with buying off-plan or i understand you wrong there.

When you buy off-plan project, generally, you pay 10% deposit upfront, yes, you can get a small loan for that if you don't have the money, but you can't borrow against the property you are buying, because it is not build yet. To secure the property, you have to have 10% cash in the bank now.

When you buying off-plan property, you don't need to go to any lender in the beginning, like if you buying it today, you pay the deposit to the developer, 10%, which should be sitting at a trust account. That is it, you don't need to arrange any loan, go the any lender, end of story.

Only when your property is nearly completion, you then start to arrange your loan with lender. In your case, that is more than 1 year from now.

I am sure your sales agent will explain all that to you in a much better way face to face ~

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 20, 2010 - 3:05 pm

I am no expert, but as far as i know

You applied the DA basis on the fact you own the place, If you don't own the place, the DA belongs to whoever that owns it. Because council appvoed it for that location, and that purpose. You only asking the council for a permission, which anyone who owns the place or intend to rent/buy the place can do so. Whoever the applicant doesn't matter, what matter is the what is approved, but then anyone can get approved under the same condition.

Even you have paid all the cost, but you can't sell the DA without the permises to carry it right? you can sell the design if someone is intereted doing the same thing, provided that you selling at a price that is lower than what they could do it themselves.

Just a thought.

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 20, 2010 - 2:33 pm

I think,,,

You are cashflow rich, but deposit poor.

If you spoke to a lender or mortgage borker first, find out how much you can actually borrow, then you have an idea of what price range of properties you should be looking for.

I see you mentioned the house are pricy over there, but properties are not just houses. Remember you are looking to make money, not fall in love with your investment. I am sure there are affortable units or apartments in your area where it might be more suitable in your situation.

Bottom line, see how much you can borrow in today's market first, otherwise with that kind of deposit,  i will consider getting mid-term off-plan so you have more time to save up in order to get your loan.

Good luck ~

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 20, 2010 - 2:26 pm

1. I am hoping that since I am getting an off-the-plan, I might be able to save more money later but would the lender take that into consideration?

– Yes, because basic on your information, you will be saving for the next 12 months before settlement, and lender do look at how you spend your money on a monthly basis, by looking at your bank statement; 
Buy off-plan are a way of investment for people who only can afford 10% deposit and couldn't get finance just yet, but able to secure a property now than later; 

 2. Will I be able to use the FHOG as a deposit?

– NO. As you mentioned you are buying your first investment property? I believe you are buying your first property but want to turn it into a investment property later?
Your FHOG will be pay from government when you about the settle your property, that is same time when you getting your loan, you still need to save up other than replying on FHOG as part of your deposit. Because the lender don't like that. Of course, by the time next year, things might change, you might able to get 90% loan, just a guess here.

3. Do I need to move into the apartment once its due for completion in 2011 for the 6 months in order to receive the FHOG? or can I start the agreement from April 2010? and physically not having to move in while the apartment is still being built?

– Yes, the full details is on your local office of state revene, just google ACT office of state revenue. You need to stay there for 6 months during the first 12 months as far as I understand from other states such as NSW;

When it is being build, how can you move in? don't confuse yourself, you can leave the place empty for 6 months then lease it out, so you can still receive the FHOG. But you need to have enough money to finance that 6 months with no rental income. On the other side, most people do rent it out privately.

4. I am wondering if any lender would offer me a loan with my current situation and if not, what other options do I have?

– You won't able to find our your borrowing option untill your property is near completion, normally 3 months before completion, you should receive notification from developer or your sales agent regarding such info.

Then you can start to search for lender on the market for your loan, since you already paid 10%, you will be safe to have another 10% by the time of completion, because in most cases, all lender will lend you money provided you have a regulard job with reasonable income at 80% loan to value raio.

To make it clear of reasonable income, lender perfer you only use 30% of your income towards your mortage, if you could have a partner such as your wife or a gurantor with assets such as your parents, even your income might be low, still ok.

Hope that helps! and buying early is better than buy later in my own opinion~

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 4, 2009 - 12:09 pm

I can't say thank you enough for everyone who took time and gave me their honest feedback!!!!

S:
Ok, the property is actually located in Port Douglas, to be more specific, 4 minute walk from 4 mile beach~  please do common on the local economic, as the more I research, the more I feel this is a emoitional puchase~

I do understand for holiday letting is a pain, would that help if the management company is a public listed company? I understand they will only let out during holiday season, but if they decide to have a 10 year contract with the body corporate, will that count as something? (yes, i missed some info again……….. )

Digger:
Sorry i must way over my head, since the property is located in QLD, of course we go with a QLD contrat>>>> I been presented with a PAMD Form 30c only, which got the developer, developer's solicitor, body corporate infor and cost, plus some disclosure statement. The form you mentioned, i think if the selling agent is in QLD, that would be much easier. But the selling agent is in Sydney, how does that work??? i need to talk to my solicitor~~~~ and get charge by the hour…..  

Richad:
Cheers for that, u are absolutely right about the question "why"….. …..

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 4, 2009 - 1:15 am

BTW … has anyone invested in holiday let unit before? and what is the capital growth like?

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 4, 2009 - 12:55 am

hi Digger, thank you for your detail reply too~

Since there might be other buyer buyin in that project, i will wait and see what the valuation will be fore the first lucky buyer~

the $420k one does seem high when the medium price for unit in the area is $300k only, but because it got direct access to the pool which right from your balcony, they decide to price it higher

I will only consider the one that is $340k, which comes with jacuzzi (OMG), and funny enough they build a studio inside the unit where you could pretty much see this as a dual key one bed + studio apartment~

As for the managemnt company, they are public listed company and been in business for long time. However, like you said, anything that is gurantee does ring some bell…………..

I was trying to find something in the area but because i would like to get something close to the beach, and i could stay there for holiday during the year, not much luck, and personally i like brand new apartment because they are easier to maintain.

There is no way i could find out the agents commission, since the selling agent is in Sydney~~

[startxingMember@startxingJoin Date: 2004Post Count: 15]

February 3, 2009 - 11:59 am

Hi richard, thank you so much for ur detailed reply~ yes, i have the chance of visiting the property and love the warm weather up there compare to 40 degrees in Sydney!

1. Yes I was told the valuation will come under due to the reason u pointed out, furiture package included. At this point,  the developer suggest because it is selling at a discount due to "reasons" ….. u know the sales pitch…. so the valuation will actually come out spot on on the purchase price.

To proof that, they actually provided 2 valuation report done by external valuer which is only 1 week old, and they value the property on purchase price~~~ but i will keep in mind that I need to be prepare for any short fall there, and may put a cause on the contract such as subject to valuation , ha ~

However, since the property is brand new,?(which i forgot the mention), do you think it most likely will be spot on valuation in your experience?

2. That is gold there~~~~  i was never aware of such clause…………. thank you again~~~~

For the 5% net, i need to be more specific, it is actually managed by company who does holiday rental, they are getting around 10% return on the property, therefore they have taken 5% as their service fee!!!!!! that is why 5% net return, in my opinion, I believe the 5% net return does not reflect on the purchase price, would you agree?