澳洲Australia property Buy to rent, or buy to live in | Sydney


在澳大利亚 The pool at of an IP needs to be resurfaced (or so the pool doctor says), the cost was estimated to be $10K ($10,000), after recoverying from my impresssion of a cat coughing up a fur ball, it just seems far too much. Its just a standard poo I need some advice regarding a property purchase. Property - semi-detached house Bedrooms - 2 Condition - average needs internal reno to modernise Street - one of the best in suburb Location - excellent Close to schools - yes Transport - 50m


Here is my situation

Bought unit Sep 09' in Marrickville, Sydney
Cost $390k
Loan $345k (IO - variable)
LVR 88% approx
Approx value $410k conservative
Rent value $410 p.w.

I have now saved an additional $35k and want to save a little more over the next 6-12 months to purchase additional IO and create a cash buffer. My orignal intention was to live in the place for 6 months then rent it out (used $14k FHOG) Given the high cost of renting should I:

a) stay here and add my extra savings into the principal of the loan, creating more equity to use for additional purchase
b) rent my place out, enjoy the tax benefits, and continue to save. My usual savings go partly to high interest savings and partly to sharemarket.

At the end of the day, is it better to have the cash in hand for my deposit on the next place, or use the equity from 1-2 years capital growth and my additional contributions to Marrickville, or even a combination of both? I earn an average salary so tax deductions not huge, however my calculations show a cost of approx $100 p.w. out of pocket to hold the property. Obviously rent elsewhere would go on top of that.

Not sure of my best option so hopefully a person with some more experience than me might be able to give some pointers.

Thanks
Nick  

评论
Here is my situation

Bought unit Sep 09' in Marrickville, SydneyClick to expand...
Loan $345k (IO - variable)Click to expand...
I have now saved an additional $35kClick to expand...
I earn an average salary so tax deductions not hugeClick to expand...
Something doesn't compute here. :confused:

To save $35k (in 12 months since purchase I'm assuming) requires $673p/w.

At 6.5% interest for argument's sake, your interest bill would be approx $431p/w,

The rent is $410, less approx 20% for holding costs = $328p/w nett rent. Let's call it $350p/w

Shortfall of approx $81p/w

What's the average wage now? $55k per year? Lest's call it $60k. Less tax = approx $800/w in your hand. Let's call it $850p/w in your hand.

After savings and rent shortfall on loan, your money left over to live off is about $96p/w. Let's call it $100p/w to live off.

Are you still living at home?  

评论
My apologies, I should have been a little clearer. I am new to the forum and was trying to simplify the situation. I had some money left over from the original purchase. I also live with my g/f who has saved also since the purchase. Combined we have approx $35k available.

BayView said: ↑
Something doesn't compute here. :confused:

To save $35k (in 12 months since purchase I'm assuming) requires $673p/w.

At 6.5% interest for argument's sake, your interest bill would be approx $431p/w,

The rent is $410, less approx 20% for holding costs = $328p/w nett rent. Let's call it $350p/w

Shortfall of approx $81p/w

What's the average wage now? $55k per year? Lest's call it $60k. Less tax = approx $800/w in your hand. Let's call it $850p/w in your hand.

After savings and rent shortfall on loan, your money left over to live off is about $96p/w. Let's call it $100p/w to live off.

Are you still living at home?Click to expand...
 

评论
Claiming the loan as an IP is always better on paper (you are switching the PPoR 'liability' into an IP 'asset'). BUT you of course still have to live somewhere. In reality, can you handle living somewhere cheaper? Quality of life and convenience to your job etc?

Example, buy another $250k tiny dump and move into that, then make your current one an IP. Now the 345k loan is claimable and you have a much smaller primary mortgage. Why not renovate the new 250k dump while you're there to create some value. Definitely a better position to be in on paper. Having a 345k loan for your primary place on an average wage is ****ing into the wind in my opinion and you will be forever battling against the interest, especially once a few more anticipated rate rises kick in.

When rates suddenly become higher, it can become quite stressful.

If it was me personally, I would be looking to make that one an investment and try to sort somewhere cheaper out to live that you can also add some value to through renovation. 410/wk is good rental income and rents are likely to only increase so I reckon go for it if you can handle living in a smaller dump for a couple of years.. Remember you can also sell the 250k for maybe low 300's after you've renovated it to cash in CGT free on the value you've added, then rinse and repeat. That will generate you a nice chunk of equity in the chosen one you live in each time in addition to what you are earning from your job.  

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