New investor!

[JUS085]

Hey guys,

I'm new to property investing. Ive been looking around a bit and I think I want to start a negatively geared property portfolio. Where is the best place to find all the info needed to get me started ( learn the ins and outs ) I'm only young still so I have plenty of time to make sure I do things right the first time. So far I have saved 35thousand. Is this enough?

 

[burty85]

Welcome to the forum, well you have come to the right place to learn the "ins and outs" of property....

Is there any reason that you want to have a neg geared portfolio atm???

Just remember if you heavily gear now while interest rates are low, make sure that you factor in for an increase of a few percent with in the next yr or two.

With a 35k deposit you could find a property that could pay for itself now while rates are low and when rates do go back up would then become neg geared....

Good luck mate,

 

[travelbug]

Welcome.
I'm wondering why you would choose to buy a property that will lose you money?

As Burty said when interest rates go up you'll lose even more money.

Where are you looking (areas)?
What types of property (house/flat/villa)?
There is a lot to consider and it takes time to make these decisions THEN you need to search for the property.

Good luck on your journey.

 

[skater]

You are in the right place to learn. There are many experienced investors here to help. Start by reading some of the interviews. You will find stories of how experienced investors started, and where they are today. Learn to listen to those who know what they are doing and not your family/friends. And finally, don't for one instant believe that the only way to get ahead is to negatively gear so you can save tax.

 

[JUS085]

I just thought neg was the way to go? And in reality by the time I actually get a place the rates may have gone up already?.. I'm looking melbourne and I'm really open to what type of property atm. Hence asking the Q. I was probably looking at something with intrinsic value because I heard this may be the best way to go? But I could not affort anything too close as I really dont want to go over 90lvr.. Or should I even keep saving and aim for 80lvr? I guess that will also be a factor with my postive / negative gearing?

 

[skater]

Please, don't take this the wrong way, as there really are some great places to buy in Melbourne, I am sure, but I notice that you are from Shepparton. Why would you want to look outside of the area that you come from for your first IP? I am sure that you would know Shepparton much better than you would know Melbourne.

I would like to hazard a guess that the reason you are looking at Melbourne is that some so called Guru has given you the idea that to be successful in Real Estate you need to invest in Capital Cities only. That, and the Tax Breaks.

There are many successful investors from areas all over the Country and I'm not trying to talk you out of Melbourne. For all I know, you have done a lot of research and decided that this is the area for you. All I am trying to establish is why you have decided on Melbourne.

To work out how much you need to put into the property, you will need to speak to a Bank/Broker as well as deciding what is comfortable for you. May I suggest that you speak to one of the ones on this forum, as most of them are very tuned into what the investor is looking for.

 

[JUS085]

No thats fine. I'm open to ALL opinions and scepticism on my current ideas, because I really dont know as much as I'd like to at this point. And I could very well be wrong...... Shepparton would be perfect for me, however I dont belive I'd get the capital growth like I would in melb, is this right?... I know melbourne ok, I did live there for 18 months.. But even if I were to buy in the city, wouldnt I be best to diversify my future portfolio to diffarent citys anyway?... Just encase.

And another thing is I have been told by my accountant not to buy in Shepparton because of the new stimulas package. She paid 250k for a property ( that would be the median in shepparton for 3bed, 2 bath town house ) two years ago and now you can get a bran new house in a new semi developed estate in an awesome area ( quiet area, nice houses next to a gold corse!) build for the same price, maybe cheaper. And compared to her melb IP is heavily under performing... From what I gather she only has two but seems to know a bit about it all.. She is also a family frd so its all non bias pov... But if it turned out to be fesible for me to buy in shepparton, belive me i would!...

 

[skater]

First, let me say that I don't know Melbourne AND I don't know Shepparton, but what I do know is that you will find sub markets within many different areas. The larger the City, the more sub areas you will have. Bearing this in mind, you will find that one part of Melbourne may perform extremely well, while another does not. It may be the same (probably to a smaller degree), in Shepparton.

You will probably find that a property will be easier to afford in Shepparton than in Melbourne. For instance, your new property of around $250k, could, maybe rent for $300pw. While you might have to pay, say, $450k for something of similar quality in Melbourne that rents for $350pw. Again, these numbers will not be the real numbers, because I have done NO research on either area, just using them as examples. So, you might not get as high capital growth, but you might get a better yeild.

Work out what you want to achieve from your investments, then work out where you will find the properties that will (probably) give you that outcome. For instance, our first IP cost $90500 and rented for $185pw. That was the top dollar that we could afford at the time and being on a low income needed to get a good yeild to pay for it. It took a while, but even as total newbies, found an area where we could get what we wanted.

Good Luck.

 

[JUS085]

That does make sense.. I'm going to go on realestate.com.au now and start making a bit of a data base!...

Appreciate your help, very informative