Best way to purchise second IP??

Hi All,

A year ago I managed to make the first step into what I hope will be a career in property investment by buying my first IP at 24.

Now im looking to buy my second and am needing some advice, I was lucky enough to buy my first IP $20,000 under the asking price with the great help of a brilliant BA (Paul from Logica).

I bought the house for $260,000 at Morphett Vale, it is currently rented at $275 per week (seems cheap at current rental prices in the area) its a neat and clean 3 bedroom house with 1 bathroom in a quite cul-de-sac, it has a lot of potential to be a beautiful property at Morphett Vale.

Currently I have $10,000 saved, im thinking to do a little work on my current property (bathroom needs new vanity and kitchen could do with un upgrade) then hopefully get it revalued and use the capital on that property to be able to borrow for my next.

Does anyone have any advice or a different way of achieving a profitable second IP??:)
 
Good work!

The only way to get more deposits, which is what holds many investors back is to:
1. Manufacture equity thru a reno on existing property (just what you are proposing). Just make sure you get $2+ back in end val for every $1 you spend on a reno.
2. Get a really high LVR loan - 95% + LMI capitalised = $97%
3. Save more. (A novel idea, I know :))
4. Borrow from, or co-invest with a partner
5. Start a new business on the side or get a 2nd job .....etc
 
Hi All,

A year ago I managed to make the first step into what I hope will be a career in property investment by buying my first IP at 24.

Now im looking to buy my second and am needing some advice, I was lucky enough to buy my first IP $20,000 under the asking price with the great help of a brilliant BA (Paul from Logica).

I bought the house for $260,000 at Morphett Vale, it is currently rented at $275 per week (seems cheap at current rental prices in the area) its a neat and clean 3 bedroom house with 1 bathroom in a quite cul-de-sac, it has a lot of potential to be a beautiful property at Morphett Vale.

Currently I have $10,000 saved, im thinking to do a little work on my current property (bathroom needs new vanity and kitchen could do with un upgrade) then hopefully get it revalued and use the capital on that property to be able to borrow for my next.

Does anyone have any advice or a different way of achieving a profitable second IP??:)

260k for 275 p/w rent. What sort of house is it, big land for future development?

Seems like the yield in Morphett Vale is similar to inner metro suburbs, are you expecting it to outperform for capital growth?
 
Good work!

The only way to get more deposits, which is what holds many investors back is to:
1. Manufacture equity thru a reno on existing property (just what you are proposing). Just make sure you get $2+ back in end val for every $1 you spend on a reno.
2. Get a really high LVR loan - 95% + LMI capitalised = $97%
3. Save more. (A novel idea, I know :))
4. Borrow from, or co-invest with a partner
5. Start a new business on the side or get a 2nd job .....etc

Thanks for your reply!

Seeing as I'm handy and a tradesperson I think option 1 might be the best way to move forward.

I'm already self employed and own a company specializing in window and door replacement for a company called Rylock windows in South Australia, so option 5 is impossible as we are ridiculously busy! hahaha thanks for the suggestion tough, its good advice for most young people to boost their income and work harder/smarter.
 
260k for 275 p/w rent. What sort of house is it, big land for future development?

Seems like the yield in Morphett Vale is similar to inner metro suburbs, are you expecting it to outperform for capital growth?

Hi Bez23,

The property is situated on a corner block in a quiet cul-de-sac on 700sqm so it has potential to be a great development.

I am expecting Morphett Vale to be a good place to invest for capital growth. if I do a little work to this property I believe I would be able to get $320pw comfortably(going on rental prices in the same area) which would cover my mortgage payments.
 
Hi Bez23,

The property is situated on a corner block in a quiet cul-de-sac on 700sqm so it has potential to be a great development.

I am expecting Morphett Vale to be a good place to invest for capital growth. if I do a little work to this property I believe I would be able to get $320pw comfortably(going on rental prices in the same area) which would cover my mortgage payments.

Ah, that makes much more sense :D. Don't overspend on renos then because one day you might want to develop it.
 
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