Hello everyone.
I just found this forum and simply had to join. I've many questions that I would like to ask but when ever I ask about property I am directed to financial advisers... who inevitably try to sell me a share portfolio.
Don't get me wrong. I am in no way, shape or form asking for financial advice. I only wish to introduce myself and give you an idea of my situation and direction. I definitely encourage all feedback, comments and ideas. I value all opinions and comments (even the negative trolly type ones). I'll sift through any overly positive or negative comments and take out the gem's of information which hopefully will give me more avenue's to explore and research.
I had a MASSIVE post written up but just deleted it all and thought I would post some simple data below, and then follow it with a description of my plan's for the future (and open questions) in the hope that someone with experience or know how might be able to suggest options that I have not considered. As always, the standard applies. "I will consider if any suggestions or advice are suitable for my own financial situation and conduct further research and seek professional financial and tax advice before making any changes to my financial direction".
Currently, I am 35yrs old. My wife (35) who is currently doing a doctorate is a dependent. We also have a 2yr old son, and another child on the way. Cudo's to my incredible wife by the way who managed to raise a 2yr old while I fifo, while completing her masters of pharmacy and working part time as a research assistant for the university.
I've managed to obtain 3 properties so far. PPOR, then an IP, then after meeting my wife accessed some equity to purchase a 3rd property which became our PPOR, turning the original one into an IP. My main questions relate to the original property. Here are some rounded stats on my situation.
Primary income: Just over $200,000 including super
1st Property
Purchase Price: $175,000
Mortgage: $295,000
House: 3x1
Land: 904sqm
Location: High Wycome, W.A.
Rent: $370/week
2nd Property
Purchase price: $350,000
Mortgage: $360,000
House: 3x1
Land: 750sqm
Location: High Wycome, W.A.
Rent: $440/week
3rd Property
Purchase price: $710,000
Mortgage: $615,000
House: 6x2
Land: 2500sqm
Location: Wellard, W.A.
So, I feel I am probably a little debt heavy and most of it is in my PPOR which is not ideal for tax but it was the best I could do and this place is definitely our forever home!!
The interesting turn of events is Property number 1. It is scheduled to be rezoned soon (fingers crossed) into R25/R60. So if I can satisfy the requirements for R60 by my calculations I could fit a maximum of 5.4 dwellings on the block. Of course, there is the street frontage etc that needs to be satisfied but even if I could split into 4 I think I would be going great guns.
Having NO IDEA about the process (yeah, I am reading through these forums and researching but got excited and needed to spill my beans) my thinking is if I could build say 4 dwellings at $130,000 each I would need $520,000.
I'm neglecting the administrative costs and the demolition costs I know. (been told about $15,000 by a local demo mob... I was going to rebuild at one stage).
So if I say, $600,000 plus existing mortgage of $295,000 then that is $895,000 worth of debt. Using my bank's poor online calculator I can only borrow $850,000 and it tells me repayments would be somewhere around $3,392/month.
Now nothing in the area is sub $300/week rent. Median asking is $450. A reiwa search just then found cheapest to be $365. My location also has the advantage of bus stops within 30m and a shopping complex within about 150m. So if I use $300/week x 4 dwellings = $4,800/month. I think this means I would be paying tax which is always a good thing. However, I could also claim the depreciation of 4 dwellings to offset this plus my own wage provided the government don't move the goal posts on that. Is that correct?
My maths is pretty bloody loose I know, but do you think I am looking in the right ball court? If the re-zoning goes ahead would I be wise to follow this dream? I can't find any information on what it would cost to build 4 townhouses or units so I am taking a guesstimate. Am I way off?
Also, do you guys use unit development companies? The ones that specialize in subdivision and cramming as many dwellings on as possible? One comes to mind but I don't want to be paying a premium for any kind of service if its not needed.
I'm looking forward to stalking these forums quite heavily but unfortunately I still feel like a novice so I won't be able to give any advice or opinions with any kind of conviction so for the most part I will be keeping my trap shut.
Thanks for reading my very long intro/question/thing.
Cheers. Red.
P.S. I had no idea what subforum to post this intro/questions/thing!
I just found this forum and simply had to join. I've many questions that I would like to ask but when ever I ask about property I am directed to financial advisers... who inevitably try to sell me a share portfolio.
Don't get me wrong. I am in no way, shape or form asking for financial advice. I only wish to introduce myself and give you an idea of my situation and direction. I definitely encourage all feedback, comments and ideas. I value all opinions and comments (even the negative trolly type ones). I'll sift through any overly positive or negative comments and take out the gem's of information which hopefully will give me more avenue's to explore and research.
I had a MASSIVE post written up but just deleted it all and thought I would post some simple data below, and then follow it with a description of my plan's for the future (and open questions) in the hope that someone with experience or know how might be able to suggest options that I have not considered. As always, the standard applies. "I will consider if any suggestions or advice are suitable for my own financial situation and conduct further research and seek professional financial and tax advice before making any changes to my financial direction".
Currently, I am 35yrs old. My wife (35) who is currently doing a doctorate is a dependent. We also have a 2yr old son, and another child on the way. Cudo's to my incredible wife by the way who managed to raise a 2yr old while I fifo, while completing her masters of pharmacy and working part time as a research assistant for the university.
I've managed to obtain 3 properties so far. PPOR, then an IP, then after meeting my wife accessed some equity to purchase a 3rd property which became our PPOR, turning the original one into an IP. My main questions relate to the original property. Here are some rounded stats on my situation.
Primary income: Just over $200,000 including super
1st Property
Purchase Price: $175,000
Mortgage: $295,000
House: 3x1
Land: 904sqm
Location: High Wycome, W.A.
Rent: $370/week
2nd Property
Purchase price: $350,000
Mortgage: $360,000
House: 3x1
Land: 750sqm
Location: High Wycome, W.A.
Rent: $440/week
3rd Property
Purchase price: $710,000
Mortgage: $615,000
House: 6x2
Land: 2500sqm
Location: Wellard, W.A.
So, I feel I am probably a little debt heavy and most of it is in my PPOR which is not ideal for tax but it was the best I could do and this place is definitely our forever home!!
The interesting turn of events is Property number 1. It is scheduled to be rezoned soon (fingers crossed) into R25/R60. So if I can satisfy the requirements for R60 by my calculations I could fit a maximum of 5.4 dwellings on the block. Of course, there is the street frontage etc that needs to be satisfied but even if I could split into 4 I think I would be going great guns.
Having NO IDEA about the process (yeah, I am reading through these forums and researching but got excited and needed to spill my beans) my thinking is if I could build say 4 dwellings at $130,000 each I would need $520,000.
I'm neglecting the administrative costs and the demolition costs I know. (been told about $15,000 by a local demo mob... I was going to rebuild at one stage).
So if I say, $600,000 plus existing mortgage of $295,000 then that is $895,000 worth of debt. Using my bank's poor online calculator I can only borrow $850,000 and it tells me repayments would be somewhere around $3,392/month.
Now nothing in the area is sub $300/week rent. Median asking is $450. A reiwa search just then found cheapest to be $365. My location also has the advantage of bus stops within 30m and a shopping complex within about 150m. So if I use $300/week x 4 dwellings = $4,800/month. I think this means I would be paying tax which is always a good thing. However, I could also claim the depreciation of 4 dwellings to offset this plus my own wage provided the government don't move the goal posts on that. Is that correct?
My maths is pretty bloody loose I know, but do you think I am looking in the right ball court? If the re-zoning goes ahead would I be wise to follow this dream? I can't find any information on what it would cost to build 4 townhouses or units so I am taking a guesstimate. Am I way off?
Also, do you guys use unit development companies? The ones that specialize in subdivision and cramming as many dwellings on as possible? One comes to mind but I don't want to be paying a premium for any kind of service if its not needed.
I'm looking forward to stalking these forums quite heavily but unfortunately I still feel like a novice so I won't be able to give any advice or opinions with any kind of conviction so for the most part I will be keeping my trap shut.
Thanks for reading my very long intro/question/thing.
Cheers. Red.
P.S. I had no idea what subforum to post this intro/questions/thing!