I would like to get some suggestions/opinions on what is the best way to go about investing in property and making it work in the long term.
I read Rixters plan and that sounds something I would like to accomplish if not for myself then at least for my kids to have an easier life. Maybe don't need to pull out equity every 10 years but just live comfortably off the rental return in say 15 years if that is possible.
My current situation is PPOR bought for 630k at the end of last year. Median price was 630k, looking now median is around 688k so that at least looks to be positive. We laid down a 20% deposit in cash set up an off set account and currently only doing IO repayments. This has been locked in for 5 years on a variable loan. Will most likely after 5 years just keep doing IO repayments.
Selling an asset in Europe currently so will have 200k to play with shortly.
I am single income earner in family with gross wages between 120-150k per annum.
I did the maths if I was to purchase 2 IP total cost of 800k pay 20% in deposit on both (160k), I would be around 5k positive cash flow on both those properties combined. If these loans were also set-up as IO.
Also have the left over 40k sitting in offset account so my IO repayments on PPOR would be a little lower than now.
If I were to dump the 200k into my offset account, I would be worse off. Works out better to buy the 2 IP after doing the maths.
So money sitting in the bank is not working the hardest for me.
What other options do I have that are better financially and give the best bang for buck.
I like the idea of pulling out equity to fund deposits. So if my house was valued at 710k at some point, I bought for 630k that is an 80k gain, could I use this 80k to be used as a deposit on a 400k property?
Or maybe best not to put down 20% deposit instead just put down 10%. Take out mortgages insurance and be done with it. In that case could buy 4 properties instead of 2 and still have 40k in bank. But now the properties would not be cash flow positive.
I do have a mortgage broker I can discuss this with. But I also like hearing more opinions and then deciding which way I want to go.
I am in Melbourne and would be looking to buy established homes on blocks of over 600sqm. Might need to up my budget as the area I was going to bet on is Frankston in the long run. Even though looking at the CG in the last 5 years has only been 9.5%. I think the next 5-10 years will be a lot better, well I hope at least. The rental yields are not too bad there compared to more expensive suburbs.
I also thought about buying in better area but then could prob only afford 1 IP but with better CG prospects. But this is different than wanting to live off rent in the future, as you would have to sell the property to get the extra cash.
Hence I probably prefer the below
Basically want to live off rent in 10-15 years. If need extra cash could sell a property but rather would not.
We don't live a lavish life style and don't really need to. Drive ordinary cars ( friends call them $hit boxes) even though could afford better, would rather spend money on property than cars etc.
I read Rixters plan and that sounds something I would like to accomplish if not for myself then at least for my kids to have an easier life. Maybe don't need to pull out equity every 10 years but just live comfortably off the rental return in say 15 years if that is possible.
My current situation is PPOR bought for 630k at the end of last year. Median price was 630k, looking now median is around 688k so that at least looks to be positive. We laid down a 20% deposit in cash set up an off set account and currently only doing IO repayments. This has been locked in for 5 years on a variable loan. Will most likely after 5 years just keep doing IO repayments.
Selling an asset in Europe currently so will have 200k to play with shortly.
I am single income earner in family with gross wages between 120-150k per annum.
I did the maths if I was to purchase 2 IP total cost of 800k pay 20% in deposit on both (160k), I would be around 5k positive cash flow on both those properties combined. If these loans were also set-up as IO.
Also have the left over 40k sitting in offset account so my IO repayments on PPOR would be a little lower than now.
If I were to dump the 200k into my offset account, I would be worse off. Works out better to buy the 2 IP after doing the maths.
So money sitting in the bank is not working the hardest for me.
What other options do I have that are better financially and give the best bang for buck.
I like the idea of pulling out equity to fund deposits. So if my house was valued at 710k at some point, I bought for 630k that is an 80k gain, could I use this 80k to be used as a deposit on a 400k property?
Or maybe best not to put down 20% deposit instead just put down 10%. Take out mortgages insurance and be done with it. In that case could buy 4 properties instead of 2 and still have 40k in bank. But now the properties would not be cash flow positive.
I do have a mortgage broker I can discuss this with. But I also like hearing more opinions and then deciding which way I want to go.
I am in Melbourne and would be looking to buy established homes on blocks of over 600sqm. Might need to up my budget as the area I was going to bet on is Frankston in the long run. Even though looking at the CG in the last 5 years has only been 9.5%. I think the next 5-10 years will be a lot better, well I hope at least. The rental yields are not too bad there compared to more expensive suburbs.
I also thought about buying in better area but then could prob only afford 1 IP but with better CG prospects. But this is different than wanting to live off rent in the future, as you would have to sell the property to get the extra cash.
Hence I probably prefer the below
Basically want to live off rent in 10-15 years. If need extra cash could sell a property but rather would not.
We don't live a lavish life style and don't really need to. Drive ordinary cars ( friends call them $hit boxes) even though could afford better, would rather spend money on property than cars etc.