Hi All,
In not exaxtly new to this forum, used to visit before and regularly scrolled through the wonderful advice on here. Now thanks to login dramas I had to create a new account.
Basically I am very keen to buy something but my wants/needs keep changing so that doesn help much, and now im a tad confused. Anyway…
Im 30yrs old and live in NSW, in Wollongong. Currently living at home and want to buy my own place.
I am hoping to buy something that will be a good investment as well as a good place to live, as I am seeking FHOG and need to live there for a while too.
I started off looking at houses and quickly decided that what I could afford I didnt actually want to live in ie old, needed renos etc. A couple villas looked promising but locations were poor ie railway crossing in back yard etc.
Initially I said no way to strata and units…but now Im finding theres very little else in wollongong under $400k.
I have found a 2br unit 2 bath 1 car, brand new, metres from the beach in wollongong but set on a main road (so theres traffic and noise etc). View from balcony not of the beach but of the city. Floor plan is great and quite spacious.
Agent wants me to put in an offer of $400k, these were going for $450k off the plan initially and now developer just wants to sell. Im thinking of low balling $380-390k.
Agent says he just leased a few 2 bedders for $420-450 per week. Assuming this is what I could get would this be a good investment if say…
I loaned $370k
at approx 5% variable interest (or less as 1st yr discounted intro rate)
over 30yrs
which is approx $450 per week repayments for the 1st yr and will be approx $550 per week when interest rises to 7%.
Add FHOG $14k
Stamp Duty – not sure? is this exempt now?
Strata Levies $440 per qtr
Council $220 per qtr
Water (not sure)At this stage not sure if I want the agent to manage the property, i assume he'll take approx 7% of my rent.
Other than this i have no idea what i'll get hit up for?
I have an appointment with my broker next week, but if this is a great invesment I should hurry it up.
In comparison I also inspected a 2 bedder, 2 bath, 1 car unit in a 5 year old building metres from the beach which was approx same size unit with views of ocean going for $440k, and is currently leased at $390 per week. Strata levies are $565 per qtr, council rates approx $240 per qtr.
In terms of lifestyle Id rather live in the latter, however the first one might be the way to go investment wise.
Would anyone here consider the 1st strata unit (or either) a good investment?
Sorry to be a pain, just dont know if I should put in an offer or not.
Thanks, Dee.
P.S alot of new developments in wollongong, lots of units, some still to be built, and most over $450k.
Can you add value to the older 1 (cosmetic reno)? Sorry I don't love a main rd and maybe majority will like a beach view especially in Wollongong. Have you called around, etc checked to see if you definitely can rent for this amount? If there are going to be a lot more units built will the newer one you are looking at be swallowed up in a big pool of rentals that are all kinda the same? And I wouldn't rush especially if the selling agent is really gung ho.
Where would someone rather rent? Yes you will live in it for a short time but if it is ultimately to rent out you need to remember who your market is. If renters in Wollongong want to live in the middle of town, don't care about rd noise etc then cool but if the majority of renters will pay a little more to be right on the beach then aim for that.
Good luck let us know what you go for
D
DWolfe | www.homestagers.com.au
http://www.homestagers.com.au
Email MeThanks for the quick reply DWolfe.
Yes I can add value, mind you its pretty good in its current state but I could definitely make it look more expensive. Eg could rip out carpet and put in floor boards or high gloss tiles, replace kitchen doors with shiny laminex (or poly) and a nice splashback. Some nice furniture and thats it, doesnt need painting and it has everything else.
I havent called around yet to check amount i could get, inspected both units last sat, but lookign at rentals on the net they are both within the ball park.
The agent already phoned me this morning for the one on the main road, said it was originally "sold" and buyer pulled out and gave no reason why. Hmm…interesting.
I know that out of the two units the one with beach views is better located and will always attract tenants, hence why its more expensive.
DWolfe wrote:Can you add value to the older 1 (cosmetic reno)? Sorry I don't love a main rd and maybe majority will like a beach view especially in Wollongong. Have you called around, etc checked to see if you definitely can rent for this amount? If there are going to be a lot more units built will the newer one you are looking at be swallowed up in a big pool of rentals that are all kinda the same? And I wouldn't rush especially if the selling agent is really gung ho.Where would someone rather rent? Yes you will live in it for a short time but if it is ultimately to rent out you need to remember who your market is. If renters in Wollongong want to live in the middle of town, don't care about rd noise etc then cool but if the majority of renters will pay a little more to be right on the beach then aim for that.
Good luck let us know what you go for
D
DeeBeez,
Can you afford to pay the interest if you have no tenants for a while?
The new unit will give you lots more deductions than the older unit to help with cash flow, but against this you have the one near the beach will always be worth more and give better rent for the long run gain.Haven't sat down and checked the figures as yet, but ask yourself. Is it worth it in the long run, work out your possible gains and losses, write it all down yourself, put in capital growth at different rates ( if you are lucky you should get some ).
Good Luck.
Yeah this is true WJ Hooker but with adding value DB could could still have some deductions on top of whatever exists. Get a good quantity surveyor to come through on either when u have settled.
Yeah agent = vendor best interests, not yours. I'd string the agent for a bit see what other tricks he pulls out to know whether he is serious or just feeding me spiel.
Remember you are buying, your money, your investment.
Good luck
DWolfe | www.homestagers.com.au
http://www.homestagers.com.au
Email MeComparable unit but older and away from main road with ocean view: $440k
Brand new unit on main street with city view: $400k.Assuming the valuation is fair and accurate, I know which one will generate far more capital gain, and that's what I'll stick with.
Plenty of land still to build on main roads without ocean view. Those with ocean view demand a premium.
you guys are wonderful!!!
I absolutely love this forum. So much insight, knowledge, opinion and experience.
Im fortunate in that I can afford to pay if I have no tenants for a while and can always go back to mum & dads in worst case scenario.
Got in touch with my broker and hes going to see me tonight. Happy days.
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