Hi all,
I know that many people have asked for similar feedback but i would be interested to hear other's opinion on my current situation. I have been checking into this forum regularly for the past 12 months whilst saving, and enjoy reading most of the posts. However, I'm getting close buying my first IP and thought I would run it past you all…
Thanks for taking the time to respond (if you do).
Here's my situation:
Earn $54,000 gross p.a.
Pay Rent $180 per week
Currently save $200 per week
have $15,000 deposit
no debts/credit cardsHere's my ideas:
• Want to buy IP not PPOR, still want to rent in East Brisbane (where I want to live close to city).
• Purchase price $200,000 max.
• Have been approved for 280,000 loan but do not want to over extend myself
• Like to get something less than 20 years old (depreciation)
• Would buy anywhere in Aust. wherever I see potential
• Only purchase residential unit/house (not land/commercial)
• Look for cash flow+ opportunities or at least try to cover most expenses
• Use my savings to cover any shortfall and add to mortgage as extra repayments
• Build enough equity in the next couple years through CG and extra payments to purchase second IP and so on…To me that sounds smarter than living way out in the burbs in my first PPOR, all my money going into an asset which gives me no return, isn't where I want to live and is not tax deductible.
Thanks again, appreciate any feedback.
A
If you owned a PPOR rather than renting you also would incur Maintenance costs that your current renting situation doesn't incur.
The main point is getting into the game. Once you start paying down the loan and building equity your financial position will improve just remember this major wisdomBorrow money for appreciating assets
Pay cash for depreciating assets like cars, televisions, ect
Eventually you will build wealth doing this.Most people have these around the other way.
Borrow for depreciating assets
Spend cash on very little as paying off loans for items that are going down in value.Be aware that rent in inner suburbs of Melbourne have been recently skyrocketing up 20% due to a lower vacany rate and not enough investors in the market , so I do not know how your city rents will behave.
Have you read more books as the more you know the more value you can create.
I myself have read about 80% of the books out in the book stores but I do not earn enough (PAYE) income to borrow more large sums for property investing.Duckster,
Thanks for your comments. I agree with borrowing for appreciating assets, which is why I have no "bad" debt. Yes, I've read Jan Somers, Margaret Lomas, Robert Kiyosaki books, Australian Property Investor mag, Money mag… amongst others. If I read every book on property I'd never have the time to look for a place.
In a way, I think I've got a fair idea where to start, but it never hurts to ask right…
Thanks again.
A
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