If you had $150k to invest..

S

ScottT

Hey team

Looking at my next investment, I have about $150k to play with, Currently live in my place in Perth, have 2 IPs, one in Kingston(Logan) worth $260kish, another in Sunshine coast, 2x2 townhouse $340k. Both Neutral cash flow, slightly positively geared.

Theres a lot of talk of Australia being in a bad way with interest rates about to drop more and property prices to drop back also in a year or 2 time.

Are we best to wait a year for this to happen or go now ?

Where would everyone buy if you had $150k spare?

Thanks, Scott:)
 
me personally

definitely will not put any money in the real estate market right now.
I've made millions in real estate but now is not a good time to be holding onto debt - it's suicide.

Unless you are putting in cash and 50% LVR then you will be OK in the longer term if you can hold.
 
Xenia IM said:
me personally

definitely will not put any money in the real estate market right now.
I've made millions in real estate but now is not a good time to be holding onto debt - it's suicide.

Unless you are putting in cash and 50% LVR then you will be OK in the longer term if you can hold.
Click to expand...

...

Could you just clarify what you mean by "the real estate market"?
 
ScottT said:
Hey team

Looking at my next investment, I have about $150k to play with, Currently live in my place in Perth, have 2 IPs, one in Kingston(Logan) worth $260kish, another in Sunshine coast, 2x2 townhouse $340k. Both Neutral cash flow, slightly positively geared.

Theres a lot of talk of Australia being in a bad way with interest rates about to drop more and property prices to drop back also in a year or 2 time.

Are we best to wait a year for this to happen or go now ?

Where would everyone buy if you had $150k spare?

Thanks, Scott:)
Click to expand...

With 2 in SEQ you could diversity into another state (assuming you are buying in own names and at risk of hitting land tax threshold at some point) NSW, SA or WA. WA would be the most counter cyclical, SA is discussed a lot on the forum and NSW has plenty of growth an options, but in my view Sydney is past its best for new purchases.
 
Xenia IM said:
me personally

definitely will not put any money in the real estate market right now.
I've made millions in real estate but now is not a good time to be holding onto debt - it's suicide.

Unless you are putting in cash and 50% LVR then you will be OK in the longer term if you can hold.
Click to expand...

Why do you believe this? Do think interest rates are likely to rise? Do you think property is over priced? Do you think some markets are about to decline? Debt has never been cheaper, do you think unemployment is likely to rise significantly? I personally wouldn't feel comfortable with a high LVR either but I don't share your general pessimism
 
I think Australia is in a real estate bubble at the moment, if you are paying cash or low LVR then it's OK, all signs are pointing towards a market correction.

People holding high debt and purchasing at the top could expose themselves to margin calls if there is a correction.

I could be wrong - but high debt is not my game in this market.

I'm only sharing a personal strategy not giving advice that fits every single person. Discretion.....
 
Xenia IM said:
I think Australia is in a real estate bubble at the moment, if you are paying cash or low LVR then it's OK, all signs are pointing towards a market correction.

People holding high debt and purchasing at the top could expose themselves to margin calls if there is a correction.

I could be wrong - but high debt is not my game in this market.

I'm only sharing a personal strategy not giving advice that fits every single person. Discretion.....
Click to expand...

What difference does it make
Cash or finance
 
Hooray said:
Have you ever seen a margin call for standard residential loans?
Click to expand...

my dad was an investor in the 80s - I was 10 years old but yes!

also I have sold lots and lots of properties of investors getting into too much debt when markets turn - bank orders, whether it's margin calls or whatever - they needed to sell because properties were not worth what they paid for them.

they will not target home owners - investment properties will be most at risk.

cashed up people will be fine.

this is not advice and I don't need to justify anything, just sharing what my personal view is.

I have made millions in property but I am NOT a property investor. I study cycles and human psychology - not properties.

to me the best investment right now is business - but only for some.
 
Xenia IM said:
I think Australia is in a real estate bubble at the moment, if you are paying cash or low LVR then it's OK, all signs are pointing towards a market correction.
Click to expand...

Australia is a big place,i only have to walk up the street past all the people sitting on old milk crates having a coffee,and every 500 mts the land values change,but my question is What signs are you starting to see that have not been on the radar for the last 18 years,the only difference is price interest rates and volume and if you understand volume nothing going to change..

https://www.youtube.com/watch?v=JL9eO4-aDMs
 
guys get some books on market cycles - study economics and psychology - what drives market cycles.

If you don't know the difference between buying properties for cash and exposing yourself to high finance in a down turning market then please get educated.

The entire monetary system is false - please look into it.
You cannot learn this stuff on an investor forum - there is a lot to it.
 
You really believe we're in a bubble? I think Sydney is the closest to one but I can't see Australia being in one..

Now you study all bubble economics, what is going to cause the bubble to burst?
 
What signs are you starting to see that have not been on the radar for the last 18 years..

Very simple question,if you think it's a childish attacks then that's your problem..
 
Back to the original question - where would you buy for $150k?

Cant specifically answer that, however I've just bought something at the lower end of the market in Adelaide.

Spent $190k. Property needs a fair bit of cosmetic work (doing myself), but expect it to be valued in the mid $200's when I'm finished.
 
wasn't this "bubble" supposed to burst every year for the last 15 years.. i do believe sydneys market will correct once the "FOMO" effect drops off.. But given Sydneys population growth i cant see a bubble popping anytime soon.. even if interest rates do rise slightly... History tells the story.... thats my view and do i appreciate others....
 
MitchNik said:
wasn't this "bubble" supposed to burst every year for the last 15 years.. i do believe sydneys market will correct once the "FOMO" effect drops off.. But given Sydneys population growth i cant see a bubble popping anytime soon.. even if interest rates do rise slightly... History tells the story.... thats my view and do i appreciate others....
Click to expand...

I think we'll see a lot of mortgagee in possession sales when the rates go up but I don't think we'll be seeing an interest rate rise in a long long time. Not until our economy transitions from mining to tourism.
 
I don't want anyone to have a hissy-fit but I'd put that money into a cash flow positive property in a cheaper city like Adelaide, anyone know any agents out that way?
 
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