Forums / Property Investing / General Property / Age 23 First time buyer/investor

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  • Profile photo of Steven BSteven B
    Participant
    @steven-b
    Join Date: 2010
    Post Count: 10

    I want to buy a house or unit which is best? i work full time average income – low. I live at home no bills and I have a large deposit saved. Should I buy a unit first or a house? Also what area? I live in penrith

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,110

    Define ‘best’ first!

    This is such a broad question it is impossible to answer. but generally you might want to consider that units may have less land value than houses. Land values generally increase, but the value of the buildings gradually decreases as it ages.

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
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    Profile photo of Jacqui MiddletonJacqui Middleton
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    @jacm
    Join Date: 2009
    Post Count: 2,539

    Hi Steven

    Well done for saving a deposit at such a young age – and what a great opportunity to get in the market while your overheads are low (still living at home with parents).

    We might be able to comment a bit more if we understood how much deposit you’ve saved, and roughly what your salary is.

    Jacqui Middleton | Middleton Buyers Advocates
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    VIC Buyers' Agents for investors, home buyers & SMSFs.

    Profile photo of Corey BattCorey Batt
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    @cjaysa
    Join Date: 2012
    Post Count: 1,010

    Property is merely an investment vehicle – what are you goals? Why do you want to invest? When do you want to reach your goals?

    Find the answer to these questions and then it doesn’t become a question of unit vs house vs any other type of investment – it becomes a questions of WILL this work towards achieving my goals, in the time that I need at the rate that I expect?

    Establish your goals, build your team of professionals (broker, accountant, Buyers agent perhaps if you want to go down this path), then it will all make a lot more sense and you’ll have a clearer direction.

    • This reply was modified 4 years, 3 months ago by Profile photo of Corey Batt Corey Batt.

    Corey Batt | Precision Funding
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    Profile photo of BuyersAgentBuyersAgent
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    @knightm
    Join Date: 2005
    Post Count: 313

    Gday @steven-b

    I was 23 when I bought my first. The unit vs house question can be a bit irrelevant. As Corey said its about setting your goals, then taking steps to move towards them.

    My first property (many yrs ago!) was a 2 bed townhouse in Brissy for 65k, but it had renovation upside potential and a desperate vendor. The combo meant within 6 months I could refinance it and buy a 3 bed brick home in the same area. Another renovation on that 2nd property meant a 3rd property after another 6 months. Holding 3 properties through the last cycle up there was what got me my start, it funded my wife and I having kids (with her no having to work for 9 yrs) and bought us a block of land to build our house upon. I could not have done any of that on the salary I was on at the time as a social worker. These were my stage 1 goals, mainly family related. These days I am looking at development sites for short term equity deals and long term cashflow deals as I am moving from my initial goals to my long term income replication goals.

    So what you buy is really important, but not as simple as a unit vs a house. Location is also a big deal, are you thinking Sydney? I has had a lot of growth in the last few yrs.

    BuyersAgent | Precium
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    South Coast NSW Independent Buyers Agent - Wollongong to Batemans Bay and Regional NSW

    Profile photo of superAndrewsuperAndrew
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    @superandrew
    Join Date: 2014
    Post Count: 188

    I want to buy a house or unit which is best?

    Depending on your budget and location but generally:

    1. House
    2. Townhouse
    3. Unit

    Cheers
    Andrew

    superAndrew | Property Analyser and Finder Tool
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    Profile photo of Luke TaylorLuke Taylor
    Participant
    @world-changer
    Join Date: 2005
    Post Count: 415

    Hi Steven ,

    Mate the other guys have given some good points.
    I would look at some of these things;

    1)What are yr goals
    (ie-are you trying to reduce working hours?Trying to buy a house to live in eventually?
    What is your level of risk ? etc)
    2)What are your gifts and abilities?(what are you good at/enjoy?)
    (then you can work out what strategy will work for you)
    3) learn as much as you can from those who are doing it/(more experienced)
    4) Get some help planning a strategy; including a risk management,finance and protection strategy,

    But at the end of the day if yr like most of us who learn through doing it
    i would give 6 tips for a low risk startegy starting out;

    Buy something under median price (for middle range product)at lower end of market price range)
    That is under market value
    That has an opportunity for you to add easy value(eg paint ,extra wall for bedroom etc)at low cost)
    That covers its costs through rent once rented
    In an area that has capitol growth potential,
    then refinance (making sure you keep the property costs at neutral or positive)
    and
    go again

    Luke Taylor | Hope Property Investing
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    Profile photo of RickRick
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    @rixter
    Join Date: 2003
    Post Count: 15

    Steven B, as the others above have mentioned, what and where to buy is dependent upon your chosen investment strategy.

    You see property is merely the vehicle. The strategy is how you intend driving that vehicle.

    Unfortunately the mistake I see newbies and sometimes not so newbies is that they are property focused instead of strategy focused which is like putting the cart before the horse.

    Property investing is not about property rather about the strategy and the way you intend to use the vehicle to get to where you are wanting to go. No good buying a small shopping car if you intend driving interstate on a family holiday.

    What strategy/s are best for you is determined by where you are wanting to go, the time frame you want to get there in and how hands on along the way you want to be – all based around your personal risk profile.

    I hope this provides some food for thought.

    What is your chosen investment strategy?

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    Profile photo of Howard MoralesHoward Morales
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    @howardm673
    Join Date: 2015
    Post Count: 16

    Get the right agent. A good agent can relieve some of the stress of house hunting. Get recommendations from friends and co-workers in your area. Don’t just let the listing agent on a house represent you both, as his fiduciary responsibility is to the seller. Interview a couple of agents to find the right chemistry and look over their record of sales in the past year. Once you have found somebody you like, make sure she is willing to communicate with you in the form you want (email, phone, text, etc.) and as often as you want.

    Howard Morales | Selling investment property in brisbane
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    Profile photo of BuyersAgentBuyersAgent
    Participant
    @knightm
    Join Date: 2005
    Post Count: 313

    As asked by Rix and others – tell us your goals. This will encourage a more useful conversation.

    BuyersAgent | Precium
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    South Coast NSW Independent Buyers Agent - Wollongong to Batemans Bay and Regional NSW

    Profile photo of Lloyd EdgeLloyd Edge
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    @lloyd-edgeme-com
    Join Date: 2015
    Post Count: 5

    Hi Steven, like others have mentioned, property is just a vehicle to achieve your goals. You need to work out a strategy so you know how property and what type of property can help you reach your goals. A good buyers agent or property mentor will be able to assist you here.

    I own houses, duplexes, villas and units and they all have a place in my portfolio.

    Well done on having a deposit at your age. Good luck

    Lloyd Edge | Aus Property Powwow
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    Profile photo of Richard TaylorRichard Taylor
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    @qlds007
    Join Date: 2003
    Post Count: 11,992

    Of course if your adviser is advising on finance they will need to be a Licensed Credit Representative or ACL holder.

    If you adviser is making any financial recommendations including property numbers they need to be a Licensed Financial Planner.

    Cheers

    Yours in Finance

    Richard Taylor | Mortgage Broker helping investors build their wealth thru property
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    0-40 Properties in a decade with a unencumbered portfolio value in excess of $40M. Ask me for a copy of my API Interview.

    Profile photo of Jason StaggersJason Staggers
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    @jason_staggers
    Join Date: 2006
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    Profile photo of Steven BSteven B
    Participant
    @steven-b
    Join Date: 2010
    Post Count: 10

    I appreciate everyones advice and help. I’ll do my best to provide more to my question. So I have around 75k saved. I earn only 45k at this point in a government permeant job. I have no idea what strategy to use, I was hoping you all could help? maybe rent it out cover mortgage while at home do small renovations and later in few years time sell and re do again. My goals would be able to be making a positive income and later a career out of investing and developing as my only job and living comfortable at 30. Though I’m not so good at handy work I do people who are or I could get spend couple grand on getting main things done that add value.

    Profile photo of Corey BattCorey Batt
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    @cjaysa
    Join Date: 2012
    Post Count: 1,010

    To expand on your idea, a common strategy used by a lot of my clients is to do small renovations on cash flow neutral/positive properties, draw out the equity from the increased value to buy another, rinse and repeat. Eventually you build a sizeable portfolio which has positive cash flow. Allow rental increases over time to grow you a healthy passive income (which can be aided by debt reduction/partial sell down at the consolidation or retirement phase).

    Corey Batt | Precision Funding
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    Investment Focused Finance Strategist - servicing Australia-wide

    Profile photo of Investment PropertiesInvestment Properties
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    @financial1
    Join Date: 2014
    Post Count: 1

    Good luck, Steven! You made the first step to your journey to financial freedom by being here. Residential property investment is a good venue for wealth creation. The best time to start is now while you’re still young. If you’re interested in Queensland properties, Fountain Property Group can help make the process easy and simple for you.

    Investment Properties | Fountain Property Group
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    Investment Properties

    Profile photo of Property ManagerProperty Manager
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    @property011
    Join Date: 2014
    Post Count: 1

    The best way to build wealth is through residential property investments. My sources tell me that rental properties are now in demand in Perinth. I suggest you get a great local agent who specialises in residential investment properties. This is the best time for you to start! http://www.focuspropertymanagement.com.au

    Property Manager | Focus Property Management
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    Property Management Sydney, Real Estate Management Sydney, Rental Property Management Sydney, Sydney Property Management

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