Beginner

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From: Robert Longmore


Hello all, i am a Beginner in the IP field. basically all i have saved is approx $15K, and i am now starting to look for a IP. I live in Syd, and i am looking for +ve cashflow, but finding a +cashflow property is difficult in sydney, especially on my limited budget (approx $150K) unless of course it is a 1 bedroom unit in poorly maintained building in less than ideal suburbs. Capital gain is also a high priority,but Cashflow +ve is my main aim, unfortunatly the good size blocks of land with established houses will have to be -ve geared for the immediate future, but only to the tune of about $40 to $60 per week.
Another stratagy i have been considering is purchasing a house on good land and taking the -ve gearing and then purchasing a 1 bedroom unit somewhere the is +ve geared in the attempt to offset the -ve with the returns of the +ve geared property, or vice versa
and seeing as this is my first property purchase, any other advice would be greatly appreciated
considering that i am buying in Sydney, Im 23 yrs old, and am living rent free in my fathers house. Thank you

 

[Mike]

Reply: 1
From: Mike .


Hi Robert,

Unless you're on a high income you'll have difficulty saving a deposit substantial enough to get a decent IP in Sydney. As you rightly say, $150K won't get you a decent IP in Sydney. But it will get you a decent IP in other growth centres outside Sydney. I wish I had been advised to buy outside of Sydney years ago. As it was I struggled to save the deposit and only started buying property in my early forties. I wasted a lot of years. Don't you make the same mistake.

Start outside Sydney and the capital growth you'll make will eventually get you into Sydney.

Regards, Mike