Baby on the way = what do we do? Help!!

[doinmybest]

Hi all,
My wife and I are expecting our first baby at the EOFY and need your advice!

Current position; We have an IP each and are renting a home in Baulkham Hills (2153). IP's; 1. 2bd unit in Homebush West (2140) and 2. 2bd unit in Croydon (2132). We are looking at selling Homebush West to purchase a PPOR. A sale of $390K will give us borrowing power of about $700K (no LMI).

I would prefer a property closer to the CBD, ie. Abbotsford/Five Dock (2046), Drummoyne (2047) and my wife would prefer a home in the Hills, ie. Baulkham Hills, Winston Hills, North Rocks. Given our forecasted borrowing power, a purchase in the Hills would be fine, given alot of stock on the market in the $550-700K bracket, however a purchase closer in would restrict our options to a unit/townhouse.

My thoughts with a purchase of a unit/townhouse in the 2046-2047 areas, is that when the time comes to live in a larger property the PPOR could become an IP and hopefully CG will provide enough equity to fund the next purchase.

Any advice on our current 'discussion' topic would be appreciated, Ta!

 

[Spectre]

Is the borrowing power on your wage alone? Whats happening with your wife once the bub is born.

 

[doinmybest]

Calculations based on my wage and reduced wage of wife/mum

 

[contrary]

I would listen to the wife. What happens when you're living in the townhouse and you decide to have another one in 3 years time and the townhouse hasn't appreciated enough to cover stamp duty?

If you are forced to sell in less than 5 years, you maybe up for a loss.

A more important factor in where to buy might be where you want to send the kids to primary school. Personally, I would decide on that and buy a place around there. If you haven't decided that then maybe you should before buying the place.

Also there is nothing wrong with renting for a year or two or more after the baby is born if this is less stress for you both. If you are planning to send the child to a public school you need to be in the catchment area for 12 months for a lot of places. This can be your own place or rented. Other factors are proximity to daycare and grandparents babysitting. These are probably far more important factors than the investment potential.

Would you rather a property that might go up by an extra 3% or a wife who has a meltdown because the grandparents are too far away to help out a day or 2 a week with babysitting.

 

[beachgurl]

We bought a 3 bed unit in the Eastern Suburbs with the thought that we could live there for a few years with a little one, having lift access and close to the shops etc. However, 6 months after the little one was born, I wanted to be closer to my family and the unit was on a main road and suddenly felt so noisy, so we wanted to move to the burbs. Unfortunately with me not working at that time, we didn't have sufficient serviceability to buy something that suited us and keep the unit.

We're now renting in the burbs. Looking back, we probably should've just bought a nice house here, although the CG of our unit has been great recently. Part of the fun having a property investor mindset. Do you go with your heart or your head?

The one thing to consider is how close you will be living to work. I was very appreciative that DH was only 20-30mins from home so he could be home at a reasonable hour. Every minute counts when you have a screaming baby in your arms late in the afternoon. once we moved, his commute time increased by a lot, so I had to get used to being with the baby for a longer period each day and just had to cope with witching hour on my own.

 

[HappyCamper]

...however a purchase closer in would restrict our options to a unit/townhouse.

I'm not sure where you work and where the grandparents are, so this might not be entirely suitable, but there are plenty of houses in the $550 - 700k bracket around Kingsgrove, Beverley Hills. You don't need to be out as far as the hills area.

 

[Propertunity]

Baby on the way = what do we do? Help!!

I would have thought, make a trip to the hospital once labour pains begin or waters break, followed by get no sleep or a moment's rest until the new arrival gets to 25 years old, then repeat for their child/ren.

(sorry that's no help at all)

 

[Graingrower]

And find out whats causing it.

 

[rugrat]

With kids you will find the house much better then the townhouse/unit. It won't matter so much when they are a baby, but once they are toddling and running around - it will make the world of difference.

 

[Rolf Latham]

I try and live by a simple concept

Happy wife ...........happy life


ta
rolf

 

[chilliblue]

I try and live by a simple concept

Happy wife ...........happy life


ta
rolf

According to my husband this is a just a myth.

 

[Spectre]

maybe it should be happy wife.......... happy bank shareholders?

 

[recruit2]

We're now renting in the burbs. Looking back, we probably should've just bought a nice house here, although the CG of our unit has been great recently. Part of the fun having a property investor mindset. Do you go with your heart or your head?

Good question that I often ponder myself. In one way, I reckon if you are happy emotionally and the property is a *reasonably* sound decision anyway, you will most likely tick all boxes and do well financially anyway. Because if you love living in a place emotionally, then chances are that others will also love the area and lifestyle too, i.e. its probably in demand or may have a certain scarcity factor to some degree. Therefore capital growth can often follow if you live in a great place like that where everyone wants to live. I have done well from just picking places in good/premium locations where I absolutely love to live, others also want to live there too and capital growth has always been strong.

The older I get, the more I gravitate towards enjoying each and every day and loving where I'm living and capital growth should hopefully follow that,, providing you haven't chosen some weird/peculiar place in the middle of nowhere. If you are in a centrally located premium area, I think you'll always do pretty well from it longer term and can basically just keep upgrading as time/finances permit.

 

[doinmybest]

Thank you for your replies. Work is in Parramatta, in-laws in North West, my family and friends in Southern Sydney. "Happy wife = happy life" appears to be the common line, so I guess I will start looking for a home in the Hills!! perhaps..................

 

[srini]

As someone who is building a new PPoR cuz the current PPoR (townhouse) is too small for 19 month old, do yourself a favour and get something in the burbs that is big enough for an energiser baby/toddler. Can't go wrong with that.

Townhouses/apartments are too small for them. Preferably a house (with 2 levels if you can, cuz they love stairs)

Note that I am looking at this from a lifestyle perspective, not investment/cash-flow

 

[imonmyway]

I live in a 13 sqr 3 bedroom house in the burbs and have twins they are just starting to walk and the house is starting to feel very small when my wife was pregnant we embarked on a basic refit new kitchen, bathroom and deck the house is nice but no extra space.

On one hand its easy to keep an eye on them on the other the constant noise tripping over kids toys and climbing on things is doing my head in my once study/office is now a spare bedroom toy grave general dumping ground with a tiny computer desk in the corner life is busier and more satisfying then i could ever have imagined. The thing i hadnt countered on is the amount of stuff kids need and have these days.

If i had my time again i would probably have sold when she was preganant and bought a bigger place. When people come to visit, as they do, the place bursts at the seams.

I am still considering moving but i like the location. so if I was you I would buy the bigger place in the hills