Hi,
One thing you can establish between now and 18 is a savings history. Source some high interest saving accounts i.e. ING - shop around.
There is another thought... do a search on vendor financing, wraps etc.
Borrowing money doesn't always mean borrowing form the banks.
If you find a property that is positively geared (ie the income(rent) is higher than your expenses) then borrowing is feasible.
Couple of scenarios....
1) Investor will a number of properties is retiring and looking to secure a price - agrees to sell to you by installments. The contract could be that it balloons when your 19 - so you have a set date to refinance them out and cash them out. The benefit to them is they do not have to deal with tenants.
2) Lease Option - (what ever the legal age is to sign a lease) - you have an option to buy when your 18-19 - in the meantime you lease the property - with the right to sublease (so a tenant covers your lease expenses) - then your save up a deposit with savings or rental credit. Then you exercise your option to buy when your old enough to get a bank loan.
My advice...
Find a spreadsheet, either Excel, or if you need a free one, find one online (
http://en.wikipedia.org/wiki/List_of_online_spreadsheets)
Then work out all your running costs i.e. expenses
Then work out how much rent (income) you need.
Then work out which parts of Australia will allow you to find something affordable - it may be outside your major city - start small - that way mistakes are smaller.
Then create an A5 flyer and do a flyer drop in that area - you may get a feel for the area too.
Be honest, tell people your intentions, everyone appreciates honesty.
People here might be able to help list all your expenses which you need to consider - might also be able to work out ways to increase income - ie if place has two garages - is it possible to rent 1 out for storage(?)
You have 4 years to try this out - I'm sure you'll be a guru if you apply that time to learning and experimenting.
Some people make bad investment decisions because they don't have to think about the money - i.e. they can borrow as much as they want - as a result they just buy anything. However for you, money is a rare resource - so you'll be motivated to make the most out of it. Make every cent count and think outside the box on how you can find finds without borrowing from the normal channels.
If you're dealing directly with the seller - maybe interest is not a factor - if thats the case - maybe you can protect yourself against interest rate rises.
Here's a thought - go find out how people bought and sold property before banks were lending money for property. Since you cannot borrow from banks - you might as well act as if the banks don't exist.
Find people who dont have a mortgage on their property - if they are not paying interest - then there is no pressure on them when there are interest rate rises.
Just a thought
Michael G
Whilst it might be hard to wait until the magic 18, don't lose sight of the goal of property investing; we only started in our 40's!!
