Hi, I've been lurking on these forums for quite a while (couple of years on and off) and finally think we are ready to start investing in property and need a little advice/guidance.
Firstly a bit of background:
– married with 2 early teenage children (we are in our mid 40's)
– main income package approx $225K gross (salary $145k, annual bonus $35k, super $20k, company car $25K)
– second income earner – approx $25K (self employed)
– family home approx value $700 – mortgage $35K
– share portfolio approx $95K
– superannuation approx $300We have two options we are thinking of for investing
1. invest in a holiday home (phillip Island preferably). This would be a lifestyle investment and not one we would expect to make a lot of money on. At the moment we are not in a position to utilise the house much so happy to rent out either permanently or for holiday rentals for the next 5 years and use on the odd weekend if it's not rented and we are available
2. invest in 1 or 2 apartments in Melbourne area or a new house – thinking Carlton/Brunswick/Box Hill areas.I'm only thinking of purchasing new properties as I would like to claim the higher depreciation and we are not wanting to have continual maintenance issues, this is also the reason for apartment over house and land packages.
We are currently very time poor so will not be able to devote an large amount of time into investigating all the market options.
I guess the main three questions I'm after are:
1. Does anyone have a recommendation for a property advisor in Melbourne we could trust to do some of the leg work on best location and property without just being interested in their potential sales bonus?
2. From a financing perspective are mortgage brokers like mortgage choice etc the best option or should we be going for a smaller firm?
3. Will the mortgage broker be able to advise on best finance options given our current financial position and to tax advantage of the best set up for taxation purposes or will I need to speak with our accountant about that (any advice on a good accountant would also be helpful)Apologies for the long post, but the level of advice given on her to previous posters has been fantastic and just really trying to find a starting point.
Thanks in advance.
Personally I have an aversion to apartments. Apartment means low land allocation – and it is the land that goes up in value – not the structure. Personally I would steer well clear of the cbd. Too much stock that is all same same. Too much competition. I view Carlton apartments in the same light. Massive buildings full of student accommodation urgh.
With regards to the holiday rental idea – remember that holiday folk might only stay a night or two, and you immediately have to bring in a cleaner to do the tidyup for you before the next tenant.
Personally, I'd be looking at either a townhouse in Brunswick on its own title (no body corporates!) or a townhouse or unit in Box Hill (again – no body corporates).
A mortgage broker is not a financial adviser – and in fact doesn't even necessarily own one property let alone a large portfolio. You'd be best to deal with a broker who has a financial background as well, and who has navigated all the taxation nuances over the years and successfully built a great property portfolio for him/herself. Richard Taylor (userid Qlds007 on this forum) is the man for the job. Here is his website; http://www.tayloredfinancialsolutions.com.au/
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Firstly JacM you are too kind indeed but i will take every compliment i can get as i count the grey hairs daily and they are increasing in number.
What you have to remember The4ofus is that organisations like Aussie and Mortgage Choice are in the main franchises so the quality of advise is as good as the person running the franchisee or the staff them employee.
I have come across some excellent Mortgage Brokers with both organisations who now their onions but also the mass majority who wouldnt know how to structure an investment loan if it fell over their desk.
To often Brokers look for what is easy for them rather than what is best for the client both now and in the long run.
I usually ask a client would you take finance advice from someone who hadnt even paid off their own home let alone purchased their first investment property. I know i wouldnt.
It is like going to a Doctor who has done the studying, read the theory but never performed his first operation and asking him for advice on your medical condition.
I agree everyone has to start somewhere but too many Brokers are let loose on investors in my opinon without understanding the game and the realty of lending.
Let us know if you need further advice.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
the4ofus
Hi there, we bought an investment property on Philllip Island in mid 2008, renovated it an have leased it permanently since then..with the view to use it as our holiday home in a few years.
We also thought of buying cheaply in town versus a house in a semi regional area and chose the latter for a number of reasons….cheaper buy in, more options for use (ie we could use it), more potential for capital growth (it is on a beach), population growth etc. Wonthaggi is a growing regional centre etc
The only downside is that the RE Agents in that area are on the most part very unprofessional – we have had 3 agencies manage our property and all 3 have done so in a staggeringly poor manner.
If we didn’t have 2 small toddlers we would list it on STAYZ for casual rentals…I would recommend you list the property on STAYZ website instead of permanent rental…. you can use it yourself when the place is not booked but still claim tax expenses at the same time.
Only hassle is that you will largely pay the full mortgage all year and have to wait for your losses to be adjusted at tax time.
Have you made a move yet?
Cheers
KTI agree with Richard, i have had dealings with a mortgage broker who had no idea regarding cross collatorilising ( not sure if i spelt that right) he kept pushing me towards loan products that were completely unsuitable for what i wanted to achieve with my investing. YOu really need to find out what investing experience they have before you entrust your decision making to them.
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