澳洲Australia property Pathing a way for the future. What would


在澳大利亚 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 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


Hey everyone. It seems only quite recent that I bought my first property, and have learnt a lot from this forum. I had no clue what I was doing only 5 months ago.

I am looking at possible scenarios and would like your thoughts on how to proceed.

My situation:

Property bought for 513K.
Loan (P+I) 355K. (I had a large deposit).
Interest in repayments is about $1450-1500 per month. (There is about 60K in an offset account)

Taxable income (PAYG) 80K+ bracket.

If I was to lease the property out, I would get an easy $450-470 per week. I am hence positively geared.

Soon, I will perform an equity release and try to convert the loan to Interest only.

The scenarios:
1. I had originally been set on building a granny flat out the back for about 100-120K. However, I believe this would still leave me positively geared, as the potential rental return on the GF would be about 300-400$ per week.
2. My other option is to forget about the GF and purchase another property altogether. Rental return for the first property would practically pay for itself already.
3. I build the GF AND buy another property. I havn't been able to work out the calculations for this yet. I am not sure I even have enough money to do this.

What would you do?  

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Menty,

Your in a good position. Each of those scenarios will help your future. It just depends on the figures for another property as to whether you can afford it or not.  

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menty said: ↑
1. I had originally been set on building a granny flat out the back for about 100-120K. However, I believe this would still leave me positively geared, as the potential rental return on the GF would be about 300-400$ per week.Click to expand...
You don't want to be positively geared? Why not?  

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menty said: ↑
The scenarios:
1. I had originally been set on building a granny flat out the back for about 100-120K. However, I believe this would still leave me positively geared, as the potential rental return on the GF would be about 300-400$ per week.Click to expand...
There is an old saying: You can't go broke making a profit.
menty said: ↑
What would you do?Click to expand...
I would build the granny flat, do the equity draw down and buy another. Build another granny flat, so that that one costs you nothing a month also.
Repeat as often as you can / want to.  

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menty said: ↑
My situation:

Property bought for 513K.
Loan (P+I) 355K. (I had a large deposit).
Interest in repayments is about $1450-1500 per month. (There is about 60K in an offset account)Click to expand...
too late know, but if u were my client I would have made a a fight for your loan scenario look like this

Loan IO approx 416 000

Cash in offset approx 110 000.

at 80 k, you would have saved long and hard for that 20 % deposit, and to drop it all into a future IP deposit.

Lots of assumptions I know, and these are purely general ideas, and not specific advice since we know little about you

Given your income position, Id prob go for the granny, since the cashflow increase for the $ spent will be much better than you can get with a standalone investment.

The only chink in that idealogy may be that you wont get a dollar for dollar cap gain for your 100 k granny...........the val may only go up 80, much depends on the locn and demographic.


ta
rolf  

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I thought it was "paving the way..." :D Sorry, in that correction mood - marking some papers for my students at present....

The Y-man  

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Thanks guys, you have been a great help. And yes, I should really fix up my grammar.

Also Rolf, I do realise that I will not get a 100K increase in the value of the property if I build a 100K granny flat. This was one of my initial concerns.

What sort of rental return would you consider a GF? Granted, it's probably not worth it to build a GF for only 200$ return a week. At 300-400 a week, the GF costs would be paid off in 6-7 years. Anything after would be pure profit. Furthermore, if I was to take out a loan and build the GF, I would be able to claim the interest (if I was to become negatively geared, say by buying another property). However, would it be worth considering using the money that I have in the offset account to build the GF?  

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menty said: ↑
However, would it be worth considering using the money that I have in the offset account to build the GF?Click to expand...
If you are able to get a construction loan to build the granny flat, then do that. Just be wary that not all lenders like a 2-dwelling-on-one-title situation for a build loan.  

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