hi, I am new to this investing. Just turn down a job offer as agent rept, so trying to figure out how to make some $$. I have A$30k on hand, owing a house worth A$500k, with A$300k mortgages. I was thinking what's the best option for this A$30k :
1. reduce mortages and save around A$120 a month on interest
2. buy a property worth around A$300k, pay A$15k as deposit, A$12k for stamp duty and tax, and rent it out at around A$1200 a month. With interest only payment, this is just enough for monthly payment. Then sell it off in 3 yrs when property prices went up
3. buy a property need work done at around A$300k, spend A$15k refresh it and sell of at A$360k.
What will be the best option, and how can any of this help with tax deduction?
hi, I don't quite understand, why do I have to take out additional credit on my current PPOR? can I just use this 30k to purchase another IP and have another loan on this IP? I can't put this 30k in another account to offset mortgages as my mortgage plan wasn't allow..
Assuming the situation is as simple, I'd get a job first, unless I pursue option 3. A steady income just help so much with future IPs. $30k is not a lot to live on after funding a property. (again assuming situation is as simple)
Agent Rep (RE?) job seems quite flexible timewise and is perfect for you to learn about real estate at the same time. Why did you turn it down? (rhetorical question)
Richard is spot on with LOC on PPOR. I'm financing a purchase entirely with the credit facility in LOC for deposit and costs. In other words, I use $0 of my own money to buy this house.
Hi, we're usually very hopeful when we start out. There're serious objections to the 'plans' above.
1) no problem except that you no longer have the use of the 30000. Offset is the best way.
2)Negative gearing at best.
3)You'll get into serious trouble. Even if the 300000 includes closing costs, you're looking at $60000 max 'profit' of which you spend 15 thousand on reno 10000 sale costs, 10 thousand holding costs. There's 25 thousand profit in your scenario. The downside is that it's quite hard to find such a property.
Can you re examine the mindset of you can meet your living costs with the 30thousand you currently have? Traditionally, the yield of 5% means you get 1500 a year from that.
Maybe others can give you better advice but looks like earned income is necessary.
Depending on where you're, there are always opportunities. I thought that house prices can't go up any more than they've already done but just last weekend, I went to an open inspection. Big old house needing update sitting on a 1200m2 block. Based on the price quoted by the agent, there's a fair amount of equity once the subdivision is done. Of course, that's based on today's prices & rents. If those go backwards, then the +ve cf & equity would evaporate.
Just goes to show that risk starts on the day we buy but if it's calculated, it shouldn't cause too much concern.
You're well placed to start your investment journey. Good luck, KY