Hi All,
Just have a few questions I'd like some feedback on. My partner and I are 30 yrs of age and would like to have our own house in Sydney one day (700-800k??) and also have properties as investment. We currently own our apartment outright ~430k and have about 90k in savings and earning 130k. I think we are in a good position to get into property however we are quite overwhelmed by what we should do as there are so many ways and suggestions out there.
We are thinking of buying an apartment to start with and doing minor renovations to it and hopefully sell for profit. If that works out, then we'll do it a few more times to build up a huge deposit for the house. Keeping the apartment for rent.
Currently also trying to get a pre-approved loan. Took us a month to realise NAB was ignoring us so going to try a morgage broker this time.
Does this sound like a good plan or is there a better way?
Thanks everyone
JoYes you certainly appear to be in a good position to move forward however how you structure the loan is important in order to achieve your end goals.
A pre-approval makes sense especially if you are looking to move fairly shortly.
A good broker with investment property knowledge should be able to help.
Drop us a line if you need some ideas.
Richard Taylor | Australia's leading private lender
Richard is right, always get the finance organised before you look. There are many deals and bargains that are missed out on because someone can supply an earlier settlement and shorter time for conditions. So many people dont know where to start, where this forum allows you to get free advice from those that have a good track record.
Whatever you decide good luck and don't tell your friends as 90% will nag you about any idea they didn't have first or aren't ina position to action on themselves. You are in a good position to jump into a deal or two but check with the bank first, or it could be a waste of time.
Happy Hunting
DD
Thanks for the support guys,
I dont know why but I hope Im not the only person new to investing that feels nervous about posting questions here. I dont want to ask questions that are too silly and ask too much of everyone. So if i do, I apologize now. Anyhow, here goes..
Been to see a Mortgage Choice broker a week and half ago but haven't heard back from him as yet. I;m thinking of seeking another broker for more opinions – any recommendation in Sydney?
Richard, can you explain about the 'structuring the loan' part? Is that something the broker can do or do I need to work it out myself? Whats the best way to contact you, (if that's not too much to ask) I'm in Sydney and would definitely appreciate some advice.
Thanks
JoDon’t worry. There are loads of people nervous about posting questions. Forums can be a hazardous place some times. But no question is too stupid. In fact you are only stupid if you don’t ask the questions.
In order for anyone to answer the ‘what should I do?” question, you need to first work out what you want to achieve through your investing. You stated that you want to own your own house in Sydney…and that you want to own properties as investments. How many properties do you want to own? Are you looking for passive income to fund your lifestyle or do you want capital gains?
You guys obviously seem like you are really good savers, which is good. This will help you achieve your goals.
I guess the question is, what is the next step. Are you getting pre approval to buy your house? Or to buy an investment property?
With 90k in savings you might need to borrow some money from your unit to get your LVR on your house at 80% (this will avoid the need to pay lender’s mortgage insurance). But if you move into your house then you can rent out your unit to help pay for the repayments.
If you are buying a unit to renovate then STUDY UP! Renovating and adding value is not as easy as people make it out to be. My wife is an interior designer, and it is amazing how people think what she does is easy and tries to do it themselves…and fail. Some people have the eye for it…I don’t. If it comes natural to you great…if it doesn’t then STUDY! You can’t just spend money on a house and expect to make money…you need to spend it on the right things….so find out what they are.
My wife did up a house recently. Spent $1,000 on it and increased its value by $75,000. I could never do that unless I studied a lot. To her it is her talent.
Anyway, what I am saying is to get smart. Get smart about what you want to achieve (funnily enough most people don’t know what they want to achieve when investing in property…they just want to get rich). Have a figure in mind, be it an income you want to achieve through rental returns or a figure you want to have in the bank (maybe $1,000,000). Then study up and only purchase properties if they will get you closer to your goal.
Ryan McLean | On Property
http://onproperty.com.au
Email MeThanks for the encouragement Ryan,
Our main aim at present is to get a house, first. However we don't want to be stuck with a massive loan and never be able to afford investment properties. So that's why we thought we'd buy, do some minor renovation and sell – build up cash ~ 200k so we have a big deposit THEN buy a house with a moderate loan. When servicing the moderate loan, we can still save and buy investments.
If I buy a house right now,servicing the loan will be a burden eg 800k loan.
If I buy investment properties and hold a few, i dont see how that will help us get a house. In the end we'll still end up servicing a 800k loan right?
I'd much rather buy and hold, sounds like the easier way out. Also considering moving in and reno … not sure if we can make that large deposit if we have to stay in the property for a year?
Let me know what you think. I am aware that the renovation part looks easy on television and in the books which is why i'm posting this. I'm creative with colours but i agree I need to learn more about interior decor.
PS: I hope you and your wife are in Sydney and she;s available for consultation. Will be great to know someone that has experience.
Jo
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