MinhParticipant@dmngu9Join Date: 2017Post Count: 1
I am a 23 year old graduate and struggle to structure my finance. Currently, I save 60% of my income after tax but cant really see further than that to create wealth. I read ‘rich dad poor dad’ and ‘0 to 130 properties’ and think real estate is the domain I would like to go with.
I wonder if anyone can give me advice on how to get started in real estate with little savings?Richard TaylorParticipant@qlds007Join Date: 2003Post Count: 11,992
Good on you in wanting to start your property investing journey as soon as possible.
Certainly when I was younger than you I had purchased my first 4 IP’s but have to say that was the 80’s when it was easier to obtain finance and APRA was not controlling the financing scene.
Realistically in 2017 you need a minimum of 10% of the purchase price as deposit as well as all of your acquisition costs such as stamp duty, legal fees. LMI etc. Depending on the State you are purchasing in this could easily be another 8-10% of the purchase price.
Assuming your income can support the level of required borrowing you may well find that the deposit hurdle is the stumbling block.
I would not be in a hurry to rush out and buy and would look to save up as much as possible.
Personally i don’t think over the coming 12 months you are going to miss our on any capital growth so would be looking to build up your cash flow in readiness for the next round of the price cycle.
Focus on saving and ensure you don’t collect any bad debt on the way.
Yours in FinanceJaxonParticipant@jaxonaJoin Date: 2014Post Count: 282
Study the Nathan Birch model,
one of the best examples I have ever seen.
the model is simple (in theory)
1. buy under market value
2. make sure the ROI and rental return are over 8%
3. for the first property make sure there is the ability to value add to build equity to purchase more properties (e.g. add rooms, reno, etc)
4. go to bank to refinance/access equity
5. rinse and repeatJamie MooreParticipant@jamie-mJoin Date: 2010Post Count: 5,065
5. rinse and repeat
Not as easy as it once was in the post APRA world of investing :-(
Especially if on a low/average income.
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