Hi every one
Im just doing some further research before i purhcase a block of land
Tarneit to me seems like a afforadable area to buy land (between 120 to 150k im willing to spend)
Once building is completed i will be used primarly for renting purposes
has any one experince a high traffic of people wanting to rent in that area?or what area would you by in if you had up to 150 k to spend?
cheers
Johann psaila
Jpcashflow | JP Financial Group
http://www.jpfinancialgroup.com.au
Email Me | Phone MeYour first port of call in finance :)
Hi Johann
Buy land build and rent
or
Buy house and rent ?
Buying land and building can be a very expensive undertaking, when you consider the time and money you will need to spend in locating the land and then transfering ownership which could take up to 6 months from now.
. After this you will also need to have access to various amounts of money to continue the other stages of development , building plans development applications and the other stages of the building its self you could be looking at a wait 0f another 12 to 18 months with out seeing any return on your investment.
You will of course have capital appreciation i.e the house may be worth more then it cost to buy and build…but you will need to hold for a minimum of 1 year from the time of completion to avoid high capital gains tax if you decide to sell .
If you rent you may be able to gain from $220 <??? depending on the local market demand.Remember you will have to service any borrowings from your own income for any were up to 2 years or more .
Your second choice is to locate an already existing 2 or 3 bed room property for the amount of $150,000, and then you may be able to rent it for $140 < $170 per week.
and if you do your home work you could be receiving a rental return with in a relatively short time compared to the first scenario.
depending if you have the $150,000 cash to buy out right, this choice might give you a negatively geared neutrally geared and if you borrow the whole $150,000 a negatively geared property.
If you have the $150,000 in cash you could use this as a deposit to buy more lower priced properties and borrow the balance.
Depending on the condition and location you would have more then enough cash flow from the multiple properties to cover the loan repayments.. and over a time fix the properties up so that they have an increase resale value and hopefully an increased equity to borrow against for further acquisitions….
.
These are just a few possibilities to consider..
good luck in what ever you decide to do
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