澳洲Australia property New Stratergy??? Buying IP to live in whe


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


Hi All,

My wife and I are considering buying our first IP. We are classed as high income earners (150-200K combined income) and have a very modest mortgage on our PPOR (sub 250K).

We plan on having kids in the next few years, and as such moving to acreage with a lovely home is not ideal as it does not offer the services, schools, etc that we are after. So we have decided to stay in our PPOR until we do the kids thing as it has all services within walking distance.

Realistically we are looking at a 20 year buy and hold strategy here for what I have in mind. I have found a beautiful cottage on 1.5 acres that is us to a tee. AND it’s currently leased and the tenants are happy to stay on (that’s what we have been told at this stage).

So....all things going well, I was considering making an offer, letting the tenants stay on as long as possible, and holding this until we decide to make the move from our PPOR, which would well and truly be paid off by then.

A couple of things to note here:

Would I be better off doing a P&I loan in this case seeing how we would intend to move to this property one day, or is Interest only still the way to go?

The property is about 20 minutes out of the capital city (Hobart), and all surrounding properties are lush and plush, nice big houses on acreage, etc. My concern is if I loose the existing tenants, I may find it difficult to get more tenants into this type of property. My wage can sustain this hit at the moment, but once my wife stops working with the kids, this may be an issue.
I understand not to get emotionally tied to IP’s, however what I am trying to do here is combine the buy and hold, with our dream end result, and hope it meets somewhere in the middle.
Some words of wisdom here would be great.  

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Best to use IO.

If the tenants move out you can retenant it. If you have problems you may need to drop the rent a bit.

On retirement you may also consider selling your current PPOR which should be debt free and then use the proceeds to pay out the remaining loan on the new PPOR and invest the rest.  

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Personally, I like P& I, as I like to eventually own all of my properties without needing to sell anything.

You will need to decide what you want in the end. To finish up owning everything, or selling half, and paying CGT  

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Can't really comment on whether or not buying the place is a good idea - although the concept (buying retirement house as an IP) is something we have talked about and would consider if we found the perfect house.

If you plan to pay off your current PPOR and sell it before moving into the acreage, then you would be better off having a IO loan for the acreage and putting the extra money into paying off your current PPOR (as the interest on this debt is currently not tax deductable).

If you thought there was any chance of you keeping the current PPOR and turning it into a IP in the future, then you would be better off having it as a IO loan as well and putting any extra repayments into an offset account attached to the mortgage (as long as you are disciplined enough not to spend the money you save!).

Regards,

Jason  

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I like this idea.  

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jrc77 said: ↑
although the concept (buying retirement house as an IP) is something we have talked about and would consider if we found the perfect house.Click to expand...
buying a house you might want to retire to is one thing, buying a house you are sure you will retire to is another thing, unless you are very close to retirement.

kids may move and you may want to retire closer to them.
you may have mobility problems that mean the stairs are a problem.
etc etc.  

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Ed Barton said: ↑
buying a house you might want to retire to is one thing, buying a house you are sure you will retire to is another thing, unless you are very close to retirement.

kids may move and you may want to retire closer to them.
you may have mobility problems that mean the stairs are a problem.
etc etc.Click to expand...
Point taken, however I "might" get struck by lightning tommorow. Worst case scenario is 10 years down the track we decide its not for us and sell it, still making a profit.  

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it sounds an appealing idea.

another option would be to live in the hobart property, sounds a nice place to have a family. keep your well located, walking distance present ppor for when you are older/maybe frailer??

how to structure your finances i will leave that to the experts.

to me an ideal retirement place is close to services, walking distance would be ideal. your melb place sounds like that.

we like hobart and environs too so i can see the appeal.

good luck with whatever you chose.  

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Given the 20 year timeframe, you really should structure it as an investment property. This means interest only loans and offset accounts if you want to put money against it. You might want to do a similar thing with your existing home.

A lot can change in 20 years and these types of structures will give you the flexiblity to deal with that effectively.


I think having a long term goal like that is great. I have similar plans to buy my last home now and work into it over 20 years.

I received a delightful call from a client last week. I first met them about 7 years ago when they were buying their first home. At the time they said they wanted an acreage with a nice house. They were realistic though that they couldn't afford it, so they bought a decent house in town.

5 years and 2 kids later a lot's changed. They've paid down debt, equity in their first home has gone up. The receive a decent inheritance and are able to buy some land that meets their dream requirements.

It takes them 6 months to figure out the house but they're set back with a sick child which consumes a lot of their time and focus. They still slowly chip away at it and eventually they get the plans then finance in place.

Building takes far longer than expected, but the call last week was to tell me that after all this time, they've moved in over the weekend! Great news!

They don't have serious wealth creation goals like many here, but they did have a dream of a family home that's also a small farm. They expressed this clearly to me 7 years ago and they've never lost sight of it.  

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Hi adzza, your location says melbourne, where is your PPOR? this would make a difference to this plan.  

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