Help – I am a new investor and my mind is boggled!

But then again maybe the mortgage broker knows Charlotte is over analysing and needs to just buy something (not anything I agree).

Charlotte are you the over analysing type? It doesn't sound like it to me (yet) as it sounds like you are just starting your research.

Some great advice here already. I'd say keep reading and look at want you want to achieve in the future. What goal do you want to achieve by buying property? Set some short term and long term (specific) goals. Not "I want to quit work".

When I started my goal was an equity $ amount. Then I realised no matter what that was I may still be tied to a job. Then I set a cash flow goal as well and made sure every property I bought took me closer to my goal. That made it easier with buying as well because it cut out lots of property that didn't suit my goal.

Good luck with your investing but be careful- it's addictive.

First off, you've saved up over $100k on a $60k annual salary….that's awesome.  2nd, you're here getting advice.  3rd, you're never too far along with any broker to sever ties and move on.  Erase that thought from your mindset.  She works for you…not you for her.  A good mortgage broker for investment property should own some of their own…ask if she does and how she is doing with it.  Same is true for real estate agents.  Here in the states, every agent now is an ïnvestment"or foreclosure expert but very few of them own any properties.  It amazes me how many investors buy homes from these kinds of people all on  pro-forma basis that never matches the end reality. If the current broker doesn't own property – chuck her.  Would you buy a mercedes from someone riding a bike?  Probably not!

Scan you market, got to some real estate investment meetings in your area, get educated but don't get stuck in paralysis by analysis which afflicts many you will meet in such groups.  Network with other investors or here to find solid agents, mortgage brokers and financial advisors….there are some excellent ones here. Realize that free advise is often worth less than you paid for it so be discerning.

What are your goals?  I don't like leverage personally but what do you want to achieve?  Do you really want to own property or are you looking to build wealth?  Sometimes, there are better returns to be had by NOT owning the property.  Every model is different.  

Not quite accurate DaOne… there are some brokers (and a couple on these forums in fact) that hold additional qualifications (financial advisor/accountant/lawyer) and can therefore discsuss those very things.  These chaps are very valuable individuals indeed because they understand the whole picture.

At some point you just have to make a start.  You will learn a lot quicker and lessons will be learnt better when it's real money.  You will make mistakes, fact, just learn from them and get better and better.

At some point you need to get in the game but you still want the best outcome possible.  Yes mistakes are valuable lessons but other peoples mistakes don't cost you a dime!  CBarry in answer to your question about capital gains it depends on what structure you purchased the property in, e.g. trust, Self Managed super, but your definition is correct, and it is taxed on the applicable tax bracket for the financial year.  So if you were a high income earner it would be 46.5 cents of every dollar.  I'm no accountant but that is my understanding in a nutshell if your property is purchased as an investment in your own name.

That is not a goal. It’s just a wish. A goal has to be specific. Non specif goals engender non specif plans which almost always mean you fail to achieve your goal.

A goal might look like:

I want to achieve a net income from property assets that provides a minimum annual gross income of $250K by year 10.

Once you have a clear goal you then set objectives that are subsets of the goal:

I need 20 properties that average 15kpa net of expenses.

and so on.

Once you have a goal and stepping stone objectives you can then turn your attention to an over arching strategy. After that you develop tactical plays to accomplish your strategy.

Strategy: I will shoot for 3 positively geared properties within the first 5 years and 7 in the remaining 5 years
Tactics: I will look for properties that have unrealised CG that can be realised through renovation

You can have multiple strategies. Goals, objectives, strategies and tactics are never fixed. You change them when you need to. For example you might hit your objectives ahead of schedule or behind schedule. That will necessitate some alteration to scheduling and/or a revamp of strategy to accelerate if you get on a role or completely alter a strategy if you run into a wall

It helps to build timelines and schedules into everything. This keeps you focused, on track and provides milestones to evaluate your progress.

You might want to include personal goals like; I want to be conversant in option plays by year 2 and conclude an option deal by year 3.

You could do a SWOT analysis on yourself. Strengths, Weaknesses, Opportunities and Threats. Work to your strengths and develop strategies and goals around those. Identify your weaknesses and work to redress them. Opportunities might be relationships that already exist that you can leverage. Threats might be personal debt, employment etc.

The better you understand your abilities and limitations the better you can effectively develop a plan that has a statistically much better chance of success.

I am from a regional area at Tamworth. You can still buy 2 or 3 bedroom properties here for $150K to $200K.  I was cash flow  negative until my new strategy of fully furnishing the houses in 2012 to the present time.  So far of the 4 properties purchased 3 are cash flow positive.  My strategy is to fix the bathrooms and kitchens (if needed) then fully furnish with single beds and rent to the 457 visa holders in the Tamworth area.  There are plenty of jobs that the local kids will not do, so there are plenty of these temporary visa holders in the city.   The tenants are great payers, on time every time.  Since 2006 until 2011 and on a low income below $30k  I have invested in 4 properties in this area, initially renting unfurnished and suffering from bad payers and damaged houses.  With my new strategy my returns are with the purchase prices $105K returning $700 P/W, $120K returning $700 P/W, and $185K returning $360 P/W.  They are all cash flow positive – the only one not cash flow positive with a purchas price of $160K returning $255P/W which still has to be renovated and fully furnished.   I have retired from working at age 60 after only 2 years of this new strategy.