Lower Income investing
- Thread starter BayView
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as marc stated, consideration must be taken for the obscenely high incomes that the top income earners bring home - incomes over $200,000 per annum skew the results. the average joe blow does not earn over $50,000. i work within a zone (outer sth eastern to bayside), working with children and their families where the average household income is under $50,000.
i also work with people whose income exceed $1 mil per year. again skewing results.
From reading the explanatory notes, i don't see any mention of median, only average or mean. I'm not sure why average is used instead of median as i'm not a statistician.
However I do agree these figures can be used as a guide only and as with all these type of stats, are subject to extreme outliers that may skew the average.
However I do agree these figures can be used as a guide only and as with all these type of stats, are subject to extreme outliers that may skew the average.
I recently split up with my husband and we have 1 IP. We are going to keep it and become business partners instead. When I graduate from Uni this year, I will be starting out on 40k, however, I'm not going to let that deter me from investing in IPs. He will take care of the first IP loan and I will be responsible for the new one when I buy in 6 months time. In time, we will each own half of 2 properties and have something for our individual futures to build on.
40k is well below the national average, but where there is a will there is a way. To make it work, I plan to do extra night shifts as a temp twice a month. He earns the big bucks, which will enable me to get the 2nd loan, but it will be my sole responsibility. I will buy a well located dump with 'good legs' and spend the next few years researching renos and doing what ever work I can myself. I'm very excited about learning these new skills and I don't see myself as disadvantaged just because life has thrown me a curve ball. I don't feel like I will be missing out on life because I am very lucky to have great friends who I can spend time with for free. These genuine relationships is what gives my life real meaning and helps me move forward. So good luck to all those low income earners out there trying to build a future. I'm of the opinion that there is always a solution out there, you just have to think about what it could be for you and keep going
40k is well below the national average, but where there is a will there is a way. To make it work, I plan to do extra night shifts as a temp twice a month. He earns the big bucks, which will enable me to get the 2nd loan, but it will be my sole responsibility. I will buy a well located dump with 'good legs' and spend the next few years researching renos and doing what ever work I can myself. I'm very excited about learning these new skills and I don't see myself as disadvantaged just because life has thrown me a curve ball. I don't feel like I will be missing out on life because I am very lucky to have great friends who I can spend time with for free. These genuine relationships is what gives my life real meaning and helps me move forward. So good luck to all those low income earners out there trying to build a future. I'm of the opinion that there is always a solution out there, you just have to think about what it could be for you and keep going
i'm on more than 50k now but bought 2 with wages under 40k at the time.
And went overseas, had 2 x 12 week vacancies (concurrently), a minimal london wage and was initially living off the credit card to survive.
Still managed to visit 20 countries, drink beer and have fun without refinancing..
And since then have had a failed business, large business repayments yet have still managed to keep the properties.. Did try selling one though, had a few issues there..
Am very happy I kept them now though.. Just found out one of them is in an area that has been rezoned and has added a few extra hundred k to the equity and developers hounding me to buy it.
The rental vacancies, termites etc have been worth it...
And went overseas, had 2 x 12 week vacancies (concurrently), a minimal london wage and was initially living off the credit card to survive.
Still managed to visit 20 countries, drink beer and have fun without refinancing..
And since then have had a failed business, large business repayments yet have still managed to keep the properties.. Did try selling one though, had a few issues there..
Am very happy I kept them now though.. Just found out one of them is in an area that has been rezoned and has added a few extra hundred k to the equity and developers hounding me to buy it.
The rental vacancies, termites etc have been worth it...
Thank L.AAussie
Well I had no savings to begin with, I decided to sell some parts off my car which I got $5000 for. Then saved another $8000 over about 6months.. I would put 50% of my pay away each week and used the other half for rent, food and fuel..
I bought a place for $125,000 with a tennant already in place.
Put down $10,000 deposit, and used the other $3000 + borrowed $4000 from parents to cover the purchasing costs..
Rental income was $650 a month
Loan repayments are $805 a month
So it was costing me $35 a week befor tax.
Rent has since gone up to $670 a month making it a shortfall of $30 a week befor tax.
I didnt recive the FHOG as it was for 100% investment purpose.
I have since got a depreciation shedule done and have pretty much got the propery down to costing me $1 a week after tax
There has been no real lifestyle sacrifices, you dont realy notice $30 a week..
Well I had no savings to begin with, I decided to sell some parts off my car which I got $5000 for. Then saved another $8000 over about 6months.. I would put 50% of my pay away each week and used the other half for rent, food and fuel..
I bought a place for $125,000 with a tennant already in place.
Put down $10,000 deposit, and used the other $3000 + borrowed $4000 from parents to cover the purchasing costs..
Rental income was $650 a month
Loan repayments are $805 a month
So it was costing me $35 a week befor tax.
Rent has since gone up to $670 a month making it a shortfall of $30 a week befor tax.
I didnt recive the FHOG as it was for 100% investment purpose.
I have since got a depreciation shedule done and have pretty much got the propery down to costing me $1 a week after tax
There has been no real lifestyle sacrifices, you dont realy notice $30 a week..
I fit into the low income bracket with no IPs, but should have one within the next 6 months...
I vote you should keep this thread active for the next 6 months
I vote you should keep this thread active for the next 6 months
Thank L.AAussie
Well I had no savings to begin with, I decided to sell some parts off my car which I got $5000 for. Then saved another $8000 over about 6months.. I would put 50% of my pay away each week and used the other half for rent, food and fuel..
I bought a place for $125,000 with a tennant already in place.
Put down $10,000 deposit, and used the other $3000 + borrowed $4000 from parents to cover the purchasing costs..
Rental income was $650 a month
Loan repayments are $805 a month
So it was costing me $35 a week befor tax.
Rent has since gone up to $670 a month making it a shortfall of $30 a week befor tax.
I didnt recive the FHOG as it was for 100% investment purpose.
I have since got a depreciation shedule done and have pretty much got the propery down to costing me $1 a week after tax
There has been no real lifestyle sacrifices, you dont realy notice $30 a week..
That's brilliant!
Well done.
I bought my first Unit in 2001 for $110,000, when I was on an income of $31,000. Got the FHOG, and moved in for a few months while I was painting, puting down new carpet etc. Saved the deposit of about $10,000 while i was working part time during uni.
After a few months, I rented it out for $150 (self managed) and I think from memory the repayments (P&I - i didn't know about IO then) were $600 per month, so it only really cost me the council, water and strata to hold.
It can be done - it just takes hard work to save the deposit.
Cheers
Mike
After a few months, I rented it out for $150 (self managed) and I think from memory the repayments (P&I - i didn't know about IO then
) were $600 per month, so it only really cost me the council, water and strata to hold.It can be done - it just takes hard work to save the deposit.
Cheers
Mike
Getting the big start
It's all about getting the leg up really. While my husband and I were in our early 20's, 2 good incomes, subsidised rent and no major bills, we felt we were "pressured "to buy a house by my inlaws (set yourself up, security, blah, blah) so we did in our then home town of Darwin). We sat there dumb and happy going about things for the next 7 years or so.
Now 10 years down the track, we are on 1 income and about to have our 3rd child, that we wish we knew then what we know now! Having this property in Darwin,which has nearly tripled in value, has allowed us to go down the path of starting to build a investment property portfolio. In the space of less than a year we should be picking up our 3rd IP. Due to our circumstances this would have been very difficult had we not had the equity to utilise. It can be hard to get that initial start. Our wages are about $65k which allows us to comfortably do this with some good financial wagering with our loans.
It's ironic that now is the time to we start to get serious about it when we are on half the income and 3 more mouths to feed!
It's all about getting the leg up really. While my husband and I were in our early 20's, 2 good incomes, subsidised rent and no major bills, we felt we were "pressured "to buy a house by my inlaws (set yourself up, security, blah, blah) so we did in our then home town of Darwin). We sat there dumb and happy going about things for the next 7 years or so.
Now 10 years down the track, we are on 1 income and about to have our 3rd child, that we wish we knew then what we know now! Having this property in Darwin,which has nearly tripled in value, has allowed us to go down the path of starting to build a investment property portfolio. In the space of less than a year we should be picking up our 3rd IP. Due to our circumstances this would have been very difficult had we not had the equity to utilise. It can be hard to get that initial start. Our wages are about $65k which allows us to comfortably do this with some good financial wagering with our loans.
It's ironic that now is the time to we start to get serious about it when we are on half the income and 3 more mouths to feed!
I have never worried about my limitations being a sole parent with 3 young kids. I earnt approx. 30k plus maybe 7k maintenance and 7k family benefits last fin. year. I have recently made my ex-partner a tidy sum of 90k with a house I purchased, incredibly, for him on a single income. I am currently awaiting settlement for my first IP, and have just teamed up with a business partner - we plan to buy, renovate and sell hopefully 4 properties this year alone. I have vision and drive, and am a natural with money. I only do what I do for the mental challenge, as I'm non-materialistic. Just need the stimulation. I'm a worker by nature also.
These are some really great posts. We are in the baby boomer generation and have bought 2 IPs in the last 18 months. The first one was when we were on $45K income, however we did have equity in our PPOR so took out a LOC and used it for a deposit and paying some of the shortfall. Our 1st IP has increased $40K in 12 months and we have just fixed our rates on both to help us over while the interest rates keep rising. My only regret when I fixed the loans, I didn't ask them if that was the best rate they could give me!! It did put our repayments up a bit more than I had hoped.
Jay
Jay
Dh & I bought our first IP 3.5 years ago. It was an ugly duckling and not much interest by other prospective buyers, but we knew it had something. ( RE Agent wasn't interested in us either as we "didn't look like we had any money"). We were on a combined income <$50K, with a toddler. Then DS2 came along, and my husband lost his job but was paid minimal workcare wages. I have now returned to full time work and DH studied full time to obtain Cert in Community Services.
We are fortunate that our parents are "free" child minders - for this we are forever grateful.
This year we hope to develop 2 units on the block behind origianl house.
Don't need to have all the fancy mod cons.
My now 7yo son made it simple in his quote the other day as I pulled the car out of the garage while it was raining (why would you pay for a car wash?)
"Mum why are you cleaning your car? You don't need a nice, fancy car - just as long as it is a car"
We are fortunate that our parents are "free" child minders - for this we are forever grateful.
This year we hope to develop 2 units on the block behind origianl house.
Don't need to have all the fancy mod cons.
My now 7yo son made it simple in his quote the other day as I pulled the car out of the garage while it was raining (why would you pay for a car wash?)
"Mum why are you cleaning your car? You don't need a nice, fancy car - just as long as it is a car"
I fit into the low income bracket with no IPs, but should have one within the next 6 months...
I vote you should keep this thread active for the next 6 months
I'm on a low income $45,000
In about 6-12 months time I plan to buy my first ip. However I'm not sure whether to buy
1. Inner-City Unit (for less than $250K)
Vic Park, Perth, or Highgate
or
2. Outer Suburb House ($250K-$300K)
30-40 K's from Perth
For those of you on low incomes or were on low incomes at the time of buying your first ip.
What kind of property did you buy first? and why?
I fit into the low income bracket with no IPs, but should have one within the next 6 months...
I vote you should keep this thread active for the next 6 months
oh and how did it go? Did you buy?
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