Hi All, just after some guidance….
– I have a duplex in Perth purchased in Jan 2007, paid $310, currently only worth probably $335-$345k and my loan is $175k.
– I am looking for an IP NOR, probably Beldon/Heathridge/Craigie/Edgewater, my wage is $62k per annum and I have $18k saved in the bank.
I guess I am wondering, where you would invest in Perth within the next 6 months, am I realistic in thinking I can buy something worth $375k and should I hold onto the duplex even know it’s not moving in value being on a small block etc.
Thanks
Hi JAck,
Property is a long term investment and you made your purchase pretty close to Perths peak. Since then the market has flatlined at best and dropped in other parts.
In spite of this it looks as if you have managed to make some profits (albeit paper ones at the moment) in the same time frame. For me I would be hanging onto this property especially if the property is located in a 'good' suburb.
Your overall LVR is pretty good if the valuers agree with your estimations. It would certainly be worth your while talking to a broker about your additional borrowing capacity and a suitable structure allowing you to move forward from here.
I suspect Perth, like many areas in Australia, will be relatively flat and if you are buying property off the shelf it could be a while before thre is a surge in prices. I would suggest looking for something which you can add value too.
JackPerth wrote:– I am looking for an IP NOR, probably Beldon/Heathridge/Craigie/Edgewater, my wage is $62k per annum and I have $18k saved in the bank.
I guess I am wondering, where you would invest in Perth within the next 6 months, am I realistic in thinking I can buy something worth $375k and should I hold onto the duplex even know it’s not moving in value being on a small block etc.
Hi Jack
Welcome to the forum.
I haven't assessed your borrowing capacity but one comment I'd make is that if you do decide to purchase (and if your borrowing capacity allows for it) I'd consider tapping into the equity in IP 1 to fund the deposit/stamps on IP 2. That way, you can keep your $18k cash savings for emergencies (a good contingency fund is a must) and all of your borrowings will be tax deductible.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Hey Jack,
It sounds like you have done very well repaying all your debt down.
We recently picked up a Triplex site, rentable condition, opposite a park about 8k's from the city for $380k. The deals are out there to be had. They don’t come up all the time, but when they do we are quick to jump on them.
I would suggest looking into the City of Belmont or City of Cockburn. The things to watch out for in City of Belmont are, busy roads that don't look busy at the home open, heaps of pocketed state housing and aeroplane noise. There are also some industrial pockets to keep away from, not because they are bad but because they will detract from resale price. Make sure you clearly understand the requirements about zoning, because we see a lot of blocks in this area advertised as something you can’t do. With the real estate agent’s get out of being sued tagline of, “STCA”.
In the City of Cockburn you should watch out for the slopes of blocks, the state housing is a lot more dispersed throughout the suburb which is annoying and there is a rail line/major roads making a lot of noise.
Hope that helps.
Some great advice there for me to think about, the comment made by Jamie is exactly what I'd like to do ("I'd consider tapping into the equity in IP 1 to fund the deposit/stamps on IP , That way, you can keep your $18k cash savings for emergencies (a good contingency fund is a must) and all of your borrowings will be tax deductible)
I guess now the question is how much I can comfortably borrow which i will have to liaise with a broker about. There is alot of different advice i'm getting about the market at the moment, I think it's time to buy now and within the next 6 months, others seem to think the Perth market will decline further. It's been 5 years since the boom but with the GFC there's just a heap of uncertainty. If anyone has downloaded the comm bank property guide iphone app you will see houses in Perth for sale at the moment that are cheaper than what they were in 06 and 07.
Jack
Hi Jack
Since the inception of the new Credit Act lenders have started to get a little more conservative with a clear reliance placed on serviceability both now and in the future.
In addition any loan recommendation has to be on the basis that the product is not unsuitable for your requirements.You would be suprised how many deals i see where the Bank / Banker has recommended a particular product or strategy to a client which clearly fails to meet these requirements but at the moment they get away with it.
A properly structured loan is something which will last you both now and going forward and your Mortgage Broker should be able to make a few suggestions.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
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