Hi Guys,
Background information.
I am in my early 20's and earn about $100K per year. I have a house which I purchased when I was 19 and want to sell. After selling I should have about $300K equity which I want to invest and thinking about property. I will be living with a friend while I invest paying $100 a week rent.
What I want to do
I want to purchase a duplex block and put 2 duplexes on it and then sell.
I have done some research and here is what I came up with.
Duplex Block $340k
Cost to build each duplex $150k + $20k to finish off. So $170k x 2 = $340k
So I am at $680k total which I would get an interest only loan of $380k and use my $300k equity.
So I will pay $32k interest on quick calculation which means I am up to $710k total.
The cheapest duplex in the suburb are starting at $400k+. If I complete this project in 12 months and IF prices go up I could get more than $400k.
So to me it looks like a good idea. I should be able to make $90k minus tax after expenses.
So what I need help with is:
Do you guys think this is a good idea? What am I missing?
I need to learn more about sub-dividing, tax etc. Is there any books or online literature you recommend. It needs to explain things real basic
Anyone bored and want to help a young guy out in Perth. Happy to catch up for a coffee or beer and have a chat about the subject.
Background information.
I am in my early 20's and earn about $100K per year. I have a house which I purchased when I was 19 and want to sell. After selling I should have about $300K equity which I want to invest and thinking about property. I will be living with a friend while I invest paying $100 a week rent.
What I want to do
I want to purchase a duplex block and put 2 duplexes on it and then sell.
I have done some research and here is what I came up with.
Duplex Block $340k
Cost to build each duplex $150k + $20k to finish off. So $170k x 2 = $340k
So I am at $680k total which I would get an interest only loan of $380k and use my $300k equity.
So I will pay $32k interest on quick calculation which means I am up to $710k total.
The cheapest duplex in the suburb are starting at $400k+. If I complete this project in 12 months and IF prices go up I could get more than $400k.
So to me it looks like a good idea. I should be able to make $90k minus tax after expenses.
So what I need help with is:
Do you guys think this is a good idea? What am I missing?
I need to learn more about sub-dividing, tax etc. Is there any books or online literature you recommend. It needs to explain things real basic
Anyone bored and want to help a young guy out in Perth. Happy to catch up for a coffee or beer and have a chat about the subject.