First Home Buyer in SA: Established or New?

[Nom de Plume]

Hi All,

Long time reader, first time poster.

I first read Jan Somers' books about 6 years ago, but for whatever reason, have never got around to purchasing any property.

I live in Adelaide, and am trying to make a decision on what to buy. A week or so ago, the SA Government restructured the FHOG system, which basically is a boon for property developers, due to a lagging property market.

Basically, I'm trying to work out what route I want to go down, and am looking for what others would think given similar circumstances.

I can buy an established property and get the $5,000 grant, or I can buy a new property (or build my own) and get a total of $23,500 in grants.

So, this leaves me with 2 options I'm weighing up.

1. I could buy an older home in, say, Gilles Plains, for high $200Ks or low $300Ks, which has potential to subdivide further on down the track. Say, 650-700 square metres. And I can live in this for a few years; or
2. I could buy a newly-built property and get the full grant, for the low $300Ks. In this case, I'd be living in a new home, but only on 300 square metres.

I'm not looking for financial advice obviously, but just wondering how others would approach this question.

I am in my late 20s, renting, and have about $25K saved up, meaning I couldn't buy an established property to subdivide immediately.

I'm looking forward to becoming a member of this online community.

Cheers,
Nom de Plume.

 

[aman]

Personally I'd be going with option 1. I feel it gives you more options in terms of development down the track. Have a read of the 30yr plan for greater Adelaide and you will see the potential for less restrictive zoning in the future around major transport corridors.

Don't forget to structure the loan properly, use a offset account rather than redraw facility.