One nice property or multiple not so nice properties?

[paul2299]

I don't know about a decent profit but I don't think I'll make a loss. I am fine with that as I would rather walk away from than invest more in it and then regret it!.

I am not thinking if I can't afford to live in North Balwyn/Balwyn maybe I just buy it and rent it out for the first couple of years. Is that a better plan? my kids are too young at them moment so when they are older we have a property there to move into. How is the rental market in that area?

Once again, I really really appreciate the advice and direction you all have provided me in the last few days. I thank you all for the help and paitence you have provide me......I would have given a virtual beer/champagne/any form of alcohol but i can't find the appropriate emoticon!

Praveena.

On a typical old North Balwyn house say 950k the rental yield is going to be very low. I would think 1%-2% after all costs. Maybe $450pw gross.

 

[The Y-man]

On a typical old North Balwyn house say 950k the rental yield is going to be very low. I would think 1%-2% after all costs. Maybe $450pw gross.

Another way to look at this is that it might be better for Pravvy to rent in N.Balwyn for a while just to see if it lives up to expectations.
In the meantime, the land at Pt Cook might go up etc.

Cheers,

The Y-man

 

[wealth101]

Pravvy, as Paul said rental return is low around here but the reantal market I think is good. Recently we saw houses around the block and couple of streets away got rented out quite quick - within 1-2 weekends (I guessed because they are in the HS Zone). It is a personal decision....but if you can cover the shortfall of Balwyn IP (low return) then I think you should go for it. We have a friend who bought a house here few years back for $500k ish rented out and just got it back this year to renovate to move in as their oldest is going to HS next year. They said they are so glad that they bought it back then ...there is no way they could afford the mortgage now. However that is theird and as said every one is different, it is up to you, your level of comfort and time frame..

Good luck with your decision.

 

[Ms Jade]

pravvy, I think your idea is sound. I agree with the OPs that the yield would be terrible, but you're not buying for yield, are you? If one of you is on a high tax rate it would be far & away a better proposition to buy an IP in NB now in the high earners name. You'll have big repayments, but they will a lot smaller than if you were living there. You can rent in a much cheaper area for a few years (as long as you can). When you are ready to move I'm sure the property will have increased in value. As previously mentioned, if you are trying to buy in the high school zone double check the map on the school website. The school also suggests that before you buy the house, you ring & check that the address is OK.