Intro, first IP and investment strategy

Hey guys,
My name is EJ, I'm 25 and am from Western Sydney. I've mentioned previously what my situation was in regards to buying a house to rent out at first then living in it when getting married, but I recently had an offer accepted in North St Marys which was a good deal at the time so I put $1000 to hold it and then the B & P inspection reports came back and there was a fair bit of termite damage so I backed out of the deal and lost my money (still unsure if this is actually normal or if I should get my money back), which is so disheartening as a first time investor.

Earnings: currently on about 78k a year but that's with some weeks where I make $500 and others where I make $4000 but on average around 1500/week. Borrowing power is 800k for property investment. 500k PPOR. These figures were all provided by my broker, westpac and NAB as well.

I am looking to buy my first investment property. I have given up on buying in Sydney unless God shines a light on a house in the west and tells me to buy it haha currently looking at townhouses in Blacktown and units in Parramatta as a last resort.

Strategy: buy interstate for capital growth and rent in Sydney when I get married (hopefully next year around Jan-Feb). Happy for it to cost me up to $100/week on an interest only loan but I will be adding $150/week on top of that to pay off principle while I live at home. I kinda wanna avoid units due to strata but if something isn't high strata then I won't mind if it has good potential for CG. Buy and hold for as long as possible and have a portfolio. I want to avoid all off the plan stuff because it's overpriced, and I don't care about using losses to lower my tax by getting me in a lower bracket. The way I see it is i'm new to investing and want good borrowing power in future so I don't wanna make 78k a year with 30k of losses.

Goals:
Short term: buy 2 properties this year.
Medium term: use the equity in these two properties to buy more next year or in two years. Also need to save enough money to get married in the next 1-1.5 years.
Long term: buy PPOR in Western Sydney, passive income, 10 properties in 10 years (I think it's possible).

I don't wanna go all out and spend 800k. Would rather spend 250k on 2 properties.

What I want: A mentor that is experienced and I can talk to and just follow. I would like someone to give me advice on how to pick a good deal because sometimes it's not just a numbers game. I want someone who is actually putting their money where their mouth and talk is.

Where I'm looking:
12km radius of Brisbane. Everton, Chermside, Nundah, Kedron, coorparoo
Outer suburbs: Logan central, beenleigh, redbank plains, redcliffe, toowoomba, springfield lakes

Melbourne: 12km radius on the west side. Sunshine, West Footscray. Also looking far west in Werribee but that would be a very long term hold to get good capital growth.

Sydney: Dharruk, Emerton, North St Marys, Tregear, Whalan, Hebersham, Blacktown (townhouses), Parramatta (units), Marrickville (units).

Would anyone be keen to help me pick where my first investment should be? I'm leaning towards Logan Central/Beenleigh, Redbank Plains or Redcliffe. What do you guys think?

p.s sorry for the hassle.
p.p.s I've been researching for 1.5 yrs until my finances were ready so I've read a fair bit on here, books, articles and have a collection of magazines haha I've met with a couple of property investment coaches and they all talk about how their company buys in qld yet none of them have put their money where their mouths are.
 
Hey guys,
My name is EJ, I'm 25 and am from Western Sydney. I've mentioned previously what my situation was in regards to buying a house to rent out at first then living in it when getting married, but I recently had an offer accepted in North St Marys which was a good deal at the time so I put $1000 to hold it and then the B & P inspection reports came back and there was a fair bit of termite damage so I backed out of the deal and lost my money (still unsure if this is actually normal or if I should get my money back), which is so disheartening as a first time investor.

Earnings: currently on about 78k a year but that's with some weeks where I make $500 and others where I make $4000 but on average around 1500/week. Borrowing power is 800k for property investment. 500k PPOR. These figures were all provided by my broker, westpac and NAB as well.

I am looking to buy my first investment property. I have given up on buying in Sydney unless God shines a light on a house in the west and tells me to buy it haha currently looking at townhouses in Blacktown and units in Parramatta as a last resort.

Strategy: buy interstate for capital growth and rent in Sydney when I get married (hopefully next year around Jan-Feb). Happy for it to cost me up to $100/week on an interest only loan but I will be adding $150/week on top of that to pay off principle while I live at home. I kinda wanna avoid units due to strata but if something isn't high strata then I won't mind if it has good potential for CG. Buy and hold for as long as possible and have a portfolio. I want to avoid all off the plan stuff because it's overpriced, and I don't care about using losses to lower my tax by getting me in a lower bracket. The way I see it is i'm new to investing and want good borrowing power in future so I don't wanna make 78k a year with 30k of losses.

Goals:
Short term: buy 2 properties this year.
Medium term: use the equity in these two properties to buy more next year or in two years. Also need to save enough money to get married in the next 1-1.5 years.
Long term: buy PPOR in Western Sydney, passive income, 10 properties in 10 years (I think it's possible).

I don't wanna go all out and spend 800k. Would rather spend 250k on 2 properties.

What I want: A mentor that is experienced and I can talk to and just follow. I would like someone to give me advice on how to pick a good deal because sometimes it's not just a numbers game. I want someone who is actually putting their money where their mouth and talk is.

Where I'm looking:
12km radius of Brisbane. Everton, Chermside, Nundah, Kedron, coorparoo
Outer suburbs: Logan central, beenleigh, redbank plains, redcliffe, toowoomba, springfield lakes

Melbourne: 12km radius on the west side. Sunshine, West Footscray. Also looking far west in Werribee but that would be a very long term hold to get good capital growth.

Sydney: Dharruk, Emerton, North St Marys, Tregear, Whalan, Hebersham, Blacktown (townhouses), Parramatta (units), Marrickville (units).

Would anyone be keen to help me pick where my first investment should be? I'm leaning towards Logan Central/Beenleigh, Redbank Plains or Redcliffe. What do you guys think?

p.s sorry for the hassle.
p.p.s I've been researching for 1.5 yrs until my finances were ready so I've read a fair bit on here, books, articles and have a collection of magazines haha I've met with a couple of property investment coaches and they all talk about how their company buys in qld yet none of them have put their money where their mouths are.

Great goals EJ, well thought out and well detailed. You're obviously well researched and have looked into different investing strategies in shaping your own.

Won't pretend to be an expert on all the areas individually, but you're likely to get a better yield from Brissy purchases. This may be important to your 10 in 10 goal - low yields can have a dramatic impact on your serviceability.

Not sure about the $1000, I have put it down many times before and walked away to get a refund. But others may have different experiences.

Good luck!

Cheers,
Redom
 
Hey EJ, you mentioned that you'd rather spend on 250k properties rather than 800k on a single property. Between the inner and outer Brisbane suburbs you've listed, you're looking at around a $200-300k difference between similar properties in inner versus outer suburbs (and rather different strategies and markets). Under $300k still exists in the Logan City and Ipswich areas.
 
Thanks guys. Bit hard to know what's gonna happen with Sydney but all signs on the ground lead to another crazy year in western Sydney as it's so cheap.

As much as I want something in Sydney, unless it's below market, it's gonna be hard for it to set me up for future purchases in next 2-3 years as the west drops, stagnates then rises for ages before a boom again.

I would rather spread my risk, but if someone knows a good area for 400k that will make me 100k then obviously i'd take that over 2 places that will make me 40k each.. The way I see it though is that if one house is empty for 2-3 weeks then it's still easy to hold whereas if I go something for 600-800k it's a lot of money during vacancy.

Who's the qld market expert on the forum?
 
Great goals, great mindset EJ.

I am in a similar position as you and I too am looking in Brissy as I feel Sydney is coming to the top of its cycle.

Make use of the search function on SS, pick a suburb that interests you, search for it and see what others more knowledgeable then you and I are saying about it on the forum.

Best of luck!
 
Nice post.

If considering outer Bris I would personally choose Beenleigh area - Logan has already had a jump in price but Beenleigh hasn't yet so you can get in at the bottom of current cycle.

There are also regional NSW options in your budget.

All the best!
 
The $1000 would depend how you purchasd the property. Was it a private sale and you purchsed subject to building inspection? If so then you should definitely get your money back. If however purchased at auction and you pulled out during the cooling off period then it is correct that you will lose that money.

One thing I picked up on in your post is you said buy an IP and make additional payments. Seek specific tax advice but this is not wise as you will lower deductions. If you have no bad debt (PPOR, Car loan, credit) then sit the money in an offset account against the IP. Then when your ready to purchase your PPOR you draw the funds from there which returns the IP back to full deductibility.

Regarding areas in melbourne, I am very keen on Albion. Nice and close to sunshine centre but with its own solid infrastructure and amenities. Long term Albion station has been marked as a key hub in the CBD-Airport rail link which will increase its value as millions move through the suburb.
 
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