1st IP, elizabeth vale SA

[whippee]

Hello all,

Just joined the forum to get some advice/opinion/education of property investment. We currently am buying house in Salisbury area. We have about 70k in equity. I have a good paying job as does my wife. We are looking at spending our money wisely, thats why we have looked at buying a IP. I have seen a couple around elizabeth vale for a good price. I believe the rent returned will be just shy of the mortgage repayments (interest only). does anyone have any rentals around this area to offer any advice? I have been doing a bit of reading to furthur my knowledge. I believe the first step is going to the bank to see how much money we can borrow, then see an account experienced in property managment correct? Does anyone know any around the northern suburbs? Then I can begin to look seriously for a house right?
Any advice will be appreciated
thanks in advance
whippee

 

[steveadl]

Welcome to SS Whippee, and good on the two of you for planning for your future.

Be prepared for your accountant to be weary of property, many are. A good property manager will be important for you as well - they're worth the tax deductible fee to remove the hassle for yourself.

If you're looking at old places, focus on properties with enough land to subdivide, even if you don't ever plan on doing it yourself.

 

[whippee]

thanks steve for reply,

I have read that there are alot more tax deductions for "new homes", including depreciation on fittings ect. Is this true.
Btw those couple of houses I have looked at have both gone under contract today, so probably miss those, oh well. Speaking to the real estate agents, theyre saying that I will probably be better off to wait until october, after the 1st home buyer grants halves. There is probably alot of truth, as just about every "cheap" home is under contract.
I have also done a bit of looking around largs, largs north, birkenhead ect. Its not easy to decide where to buy is it?
thanks

 

[crookie]

Purchasing a newer property also means you can claim building depreciation, not sure on the exact date but believe it is sometime in the late 1980's. I think the northern suburbs have some good value homes and plenty to offer with the new estates at Andrews Farm, Blakeview and the new port adelaide expressway. Good luck with your search.

 

[steveadl]

thanks steve for reply,

I have read that there are alot more tax deductions for "new homes", including depreciation on fittings ect. Is this true.
Btw those couple of houses I have looked at have both gone under contract today, so probably miss those, oh well. Speaking to the real estate agents, theyre saying that I will probably be better off to wait until october, after the 1st home buyer grants halves. There is probably alot of truth, as just about every "cheap" home is under contract.
I have also done a bit of looking around largs, largs north, birkenhead ect. Its not easy to decide where to buy is it?
thanks

You're correct, the depreciation is better for newer properties, but old properties can have quite a lot of dep. deductions as well - so don't discount them on that basis.

Newer houses will likely have less maintenance issues though. There's no right or wrong, you just have to work out what sort of property will suit you personally.

Debatable about whether to wait till after Oct. We're almost there anyway, so can't hurt - but I doubt you'll be seeing a pull back in price. Remember the FHOG is still there, just the boost is gone. So in SA they'll still get a minimum of $11k FHOG. I don't believe we saw a run in prices up north when the boost was introduced, and I doubt we'll see a drop when it's gone. There could be a drop of in amount of buyers, but again you're getting into big hypotheticals there which again I'm not convinced of.

I think you'll do well purchasing around the other suburbs you mentioned as well. They've run hard in cap gains over recent years, but the area is still developing. I do like Birkenhead, but haven't been following it. There was a house that sold last year on a big block in my Grandpa's old street that I thought would have been a good buy - this is the sort of property I'd be focusing on in that area as opposed to a small cottage that can't really be improved a hell of a lot.

 

[kum yin lau]

Hi, Birkenhead & Largs are more expensive than Elizabeth. But the gentrification is well underway. Sooner or later the industrial bits will disappear. And the proximity to the beach is a big plus factor.

Sometimes you can get a bargain: last month, a 60s home on Victoria Rd was listed @$175000. It is on a close to 900m2 block. The only drawback was the tenant who was paying $205 pw but it was a periodic lease & I bet you the rent is around $250 now. It'd have sold for less than 275000, below replacement cost.

You might want to look around Port Rd - the tramline is taking shape right before my eyes everyday as I drive into the city.

Osborne has a number of new subdivisions selling @ really competitive prices. They'd be close to cf neutral with tax considerations.

Good luck,

KY

 

[steveadl]

You might want to look around Port Rd - the tramline is taking shape right before my eyes everyday as I drive into the city.

Yeah I see it on the way to the Soccer. Amazing how quickly they're moving along with it! Try to get anything else done in SA and it takes years (anyone say hospital, old Lecornu site etc), trams takes a few months!

 

[The Y-man]

I have read that there are alot more tax deductions for "new homes", including depreciation on fittings ect. Is this true.

Yes, but you will correspondingly pay more for them - so it's whether you want to front up with big money at the start, and get it trickle paid back to you, or just not have to raise the funding for it in the first place.....

Example - Which would you prefer:

Buy $3,000 sofa today, but the shop will rebate you $100 per year for the next 10 years.

OR

Buy the same sofa discounted to $2,000 with no rebates



Cheers,

The Y-man

 

[sanjayag]

thanks steve for reply,

ISpeaking to the real estate agents, theyre saying that I will probably be better off to wait until october, after the 1st home buyer grants halves. There is probably alot of truth, as just about every "cheap" home is under contract.

Did anybody notice any price drop after 1st October in the northern suburbs of Adelaide ie. Salisbury to Blakeview ?
Any latest forecast?

 

[burstock]

[
Osborne has a number of new subdivisions selling @ really competitive prices. They'd be close to cf neutral with tax considerations.


I have started looking at Andrews Farm, can anyone provide any opinion on Andrews Farm vs Osborne ?