Brisbane CBD

[Edmond Dantes]

Hi all,

I've got an IP (Goodna), no PPOR and am looking at increasing my "multithousand" dollar portfolio in about 6 months time.

The idea would be to take advantage of the FHOG and use some equity in my existing IP.

I currently live in Spring Hill (about 15 min walk to brisbane CBD) and am wondering what you guys think of the apartments in the CBD. They are very small but may give a good yield and perhaps healthy CG in the future. My IP is negative geared and am looking for my second IP having it as close to cashflow positive in order to be able to buy more IPs in a short period of time.

Based on what I know in the past 3 years that I've lived in the city, there's currently high demand for these properties. Lots of young professionals, students, etc.

One can get a decent apartment for about 230k-250k, and by having the FOHG and using some equity it could probably be cash flow neutral by the time I move out.

Not sure if I could get the FHOG for an apartment, but that's another story.

any inputs on the CBD?

thanks & merry xmas
-Andrew

 

[Gatoblanco]

You might need to check out whether or not you can get the 1st home owner grant at all if you already have an IP.
As for the apartment suggestion I am really not sure and I am interested in what others have to say.
A two bed apartment further out could be better. I have heard a lot of bad things about 1 bed apartments. A lot of people said "dont go there".
But I guess it depends on the yield and ongoing rental demand. Like you say if you can get it positively geared asap it allows you to purchase again.
Body corp is something else to consider also.

 

[Propertunity]

I've got an IP (Goodna), no PPOR and am looking at increasing my "multithousand" dollar portfolio in about 6 months time.
The idea would be to take advantage of the FHOG and use some equity in my existing IP.

Sure - just keep in mind that the extra borrowings of equity from your IP #1 will not be tax deductable while you're are using your intended second purchase as a PPOR. When you make it into IP#2 then they will be again.

am wondering what you guys think of the apartments in the CBD.

CBD apartments are usually in good demand and Brisbane has "grown up" pretty much now. Just do your DD on supply & demand, comparable sales & rental yields as per normal.

They are very small but may give a good yield and perhaps healthy CG in the future.

Be aware that "very small" apartments can be very difficult to get finance for. If less than 50m2 sometimes you will not be able to get finance at all OR if you can get it, it will be limited to a much lower (than 80%) LVR. You might only get 60 - 70% LVR. It would be worth talking to a MB long b4 you adopt this as a strategy.

My IP is negative geared and am looking for my second IP having it as close to cashflow positive in order to be able to buy more IPs in a short period of time.

Just keep in mind if IP#2 is cash +ve you have also made IP#1 more negatively geared by borrowing IP#2's deposit from it.

Based on what I know in the past 3 years that I've lived in the city, there's currently high demand for these properties. Lots of young professionals, students, etc.

That's good DD but also confirm this with other sources.

Not sure if I could get the FHOG for an apartment, but that's another story.

I don't see why not - but check the criteria. I am assuming in all of the above you mean apartment or flat not a serviced apartment (which could? be a different story).
Just do your checks and all the best with it Andrew.

 

[Craig-G]

On the FHOG side of things. So long as you have never lived in your IP and you move into the apartment within the first 12 months and stay there for at least 6 consecutive months - you should qualify. Obviously everyones situation is different so do all the checks but that is my take on it.

By the way I love Brissy and rate there CBD well above Perth's - would love to live there myself.

Good luck - Craig