Hi guys,
6 months ago with the great advice from you guys, I bought my first IP! It's cashflow oriented and I've been very very happy with it.
I’m now considering to buy IP #2, and again in need of advice and opinion.
Basically for IP#2, should I focus on cashflow or diversify and go for growth? Based on my current circumstances?
Here’s my stats:
First/only IP home (no PPOR) bought for $281,000, rent 310pw, repayments set to weekly at 347pw. It’s interest rate is fixed for the next 2 and a half years. So I was thinking that going for CG now would diversify a bit?
I currently own 35% equity (laid 34% deposit) on that property, and have another 55k deposit saved since I bought it.
I can buy IP #2 now with the 55k deposit (minus about $15k on purchasing costs etc), or I can wait another 6 months with more money to try to near-neutrally gear my second property as well? Or is this strategy too passive and not leveraging enough?
Now the bad news!
I am self employed, and have absolutely no idea what my income is. My 07 financial year was about 55k (I finished my studies and commenced full time freelance halfway through the financial year), but this year is going to look around 80k. Unless I wait until July and do my tax return I will have to get another low doc loan.
Still living at home (nearly 25yo), but still happy here and won’t be out for a few years more.
Finally.. I’m looking at an absolute waterfront property (with licensed jetty and small boat ramp) in a traditionally capital growth long term oriented suburb. Prices have dipped lately and I’m negotiating around the low 300’s mark but the house on it is barely even a shack, and even with a bit of cleaning up and the addition of a car port I’m looking at getting no more than 150pw in rent. I won’t be doing any developing on it in the near future. We think that if we get it for what we’re asking for it’d be a really, really good price. But the thing is, is leveraging that much more with barely any rental returns the right option for me, is it worth stretching myself this much for this kind of property?
Also – what are the kinds of things to look/watch out for when buying a waterfront property? The agent did tell us that if/when a new house is built, it would have to stand a meter above the ground, and about 15 metres off the shoreline.
I really like the place because it's clear that expensive neighbouring homes are being developed with the same size blocks of land. And I’m wanting to diversify into capital growth, but I’m afraid it might be a bit early to do this?
What would you do?
6 months ago with the great advice from you guys, I bought my first IP! It's cashflow oriented and I've been very very happy with it.
I’m now considering to buy IP #2, and again in need of advice and opinion.
Basically for IP#2, should I focus on cashflow or diversify and go for growth? Based on my current circumstances?
Here’s my stats:
First/only IP home (no PPOR) bought for $281,000, rent 310pw, repayments set to weekly at 347pw. It’s interest rate is fixed for the next 2 and a half years. So I was thinking that going for CG now would diversify a bit?
I currently own 35% equity (laid 34% deposit) on that property, and have another 55k deposit saved since I bought it.
I can buy IP #2 now with the 55k deposit (minus about $15k on purchasing costs etc), or I can wait another 6 months with more money to try to near-neutrally gear my second property as well? Or is this strategy too passive and not leveraging enough?
Now the bad news!
I am self employed, and have absolutely no idea what my income is. My 07 financial year was about 55k (I finished my studies and commenced full time freelance halfway through the financial year), but this year is going to look around 80k. Unless I wait until July and do my tax return I will have to get another low doc loan.
Still living at home (nearly 25yo), but still happy here and won’t be out for a few years more.
Finally.. I’m looking at an absolute waterfront property (with licensed jetty and small boat ramp) in a traditionally capital growth long term oriented suburb. Prices have dipped lately and I’m negotiating around the low 300’s mark but the house on it is barely even a shack, and even with a bit of cleaning up and the addition of a car port I’m looking at getting no more than 150pw in rent. I won’t be doing any developing on it in the near future. We think that if we get it for what we’re asking for it’d be a really, really good price. But the thing is, is leveraging that much more with barely any rental returns the right option for me, is it worth stretching myself this much for this kind of property?
Also – what are the kinds of things to look/watch out for when buying a waterfront property? The agent did tell us that if/when a new house is built, it would have to stand a meter above the ground, and about 15 metres off the shoreline.
I really like the place because it's clear that expensive neighbouring homes are being developed with the same size blocks of land. And I’m wanting to diversify into capital growth, but I’m afraid it might be a bit early to do this?
What would you do?
