What would you buy with 500k?

[Jonathan]

Hi everyone,

This is my very first post, so I thought I'd ask something that I'm sure many newbies have asked in the past.

What you would buy if you had around 500k to spend? (First investment property)

I am most familiar with Sydney, as I live here. But i'm interested to hear other people's opinions.

Thanks,
Jonathan.

 

[firstmillion]

Hi everyone,

This is my very first post, so I thought I'd ask something that I'm sure many newbies have asked in the past.

What you would buy if you had around 500k to spend? (First investment property)

I am most familiar with Sydney, as I live here. But i'm interested to hear other people's opinions.

Thanks,
Jonathan.

You have a loads of choices mate. Is 500K your cash in the bank or is the total value of the property you want to buy ?

With this money you can buy 2-3 houses in northern suburbs in Adelaide. they are priced to grow. I was in a defense seminar yesterday and the plans they spelled out were very encouraging, it seems govt. is serious about some serious business mate. They want to develop SA as the Defence State.

Cheers

Cheers

 

[sue78]

a couple of H+L (develop yourself) to increase net worth, a couple of existing houses/townhouses with reasonable yields and LPTs with 50% margin lending (7.85 1yr fixed suncorp), maybe some shares and at least 20%buffer in offset a/c or ING.

in Brisbane ofcourse

Then you can use the increased equity in your development to keep buying.

I think it's pretty diversified and minimal risk to start off with.

 

[Glucose]

Welcome Jonathan,
Do you have $500k to put down as deposits, in which case you could buy just under $2,500,000 worth of property at an 80% LVR (depending on serviceability of course)? Or do you have deposit enough to buy $500k worth of property?

 

[traveller]

Sue,

Do you sell off the H+L packages that you develeop or do you retain them?

I would imagine that if you were to sell them then the selling costs plus GST, CG etc will just end eating away all teh equity that you created in the first place, isnt it...

Thanks-

 

[sue78]

hi traveller,

it depends on the numbers but we do sell one every 2 to 3 years.

Well, our sacrafice is that we still live at home so we can claim one property as our PPOR at any one time. I always check with ATO first to ensure I'm not liable for CGT.

 

[Twitch]

Hi everyone,

This is my very first post, so I thought I'd ask something that I'm sure many newbies have asked in the past.

What you would buy if you had around 500k to spend? (First investment property)

I am most familiar with Sydney, as I live here. But i'm interested to hear other people's opinions.

Thanks,
Jonathan.

It's hard to look at these graphs and not think Sydney is due to increase sharply over the next few years.

 

[Jonathan]

Hi everyone,

Thanks for all your responses.

Sorry to confuse you all. I've got some spare cash for a deposit on a 500 - 600k property.

I'd think about developing later, however at the moment I'm looking for something that can be rented out quite soon. I'm moving overseas next year to work for a couple of years, so I'm after something relatively low maintainence that has great potential for capital growth.

I'd also prefer something in Sydney because my family will be here to deal with any issues that may arise.

Thanks!
Jonathan

 

[alexlee]

I'd also prefer something in Sydney because my family will be here to deal with any issues that may arise.

Thanks!
Jonathan

From experience (I worked overseas for 6 years while having IPs in cities OTHER than where my family is) that isn't a big deal. You can always pay the agent to do it for you. I experienced tenant defaults, leaks (had to go through the Qld Building Services Authority), etc. I mean, unless your family are tradespeople or property managers, what can they really do? Don't limit yourself to Sydney just because of that.
Alex

 

[Jonathan]

Yeah, you have a good point there Alex.

Also, looking for an ip in another city would mean I would probably have to physically go there at some point. I'm not sure if that's logistically possible right now.

I think it's a good time to buy in Sydney right now, so I figured I should secure something before I head overseas.

 

[g1a2r3r4y5]

Gungahlin Canberra

Hi Johnathon,

I think the Sydney market is over priced. You probably won't get much for $500K in Sydney unless you're looking for something 25-30 Km from the city. I suggest you look at Gungahlin in Canberra.

Here's why, Canberra is full of white collar workers, there is hardly any unemployment there, the government is located there and they are always developing the area. The defence department is spending in the area and is developing property there for its members.

Gungahlin is a new estate with high socio-economic statistics. There is a new town centre with commercial development activity as well. Defence Housing has purchased quite a number of blocks in Gungahlin and is slowly releasing them as they become available. This helps keep demand high.

The benefits of purchasing defence housing are that you receive guaranteed rent for the term of the lease. A guarantee that your rent wont drop below what you originally started with. Leases range up to 6 - 9 years. You dont have to worry about any maintenance as that is paid as part of your fee, albiet a little more than a normal real estate agent. But you dont have to worry about maintenance costs. Defence Housing houses are usually well kept. Real estate agents like suburbs with Defence Housing as they keep the property values up in those areas. The properties are almost brand new and they give you a depreciation schedule to use for taxation purposes.

After 6 years they recarpet and after 9 years they repaint and they also return the house to you in a good condition. They should have respectable tenants in there as well as they work for defence.

There is also an express way which is due to be completed (Gungahlin Drive Express). Although it has taken some time for it to open. It should speed travel to Canberra city from 20 minutes to 10 minutes I have been told.

The Gungahlin estate looks like a moderate suburb and there is a lake and golf course close by.

Oh yeah the stamp duty is also tax deductible because the properties in Canberra are leased under a 99 year lease with the Crown.

I am also from Sydney and I drove to Canberra to view the property before I purchased it. I welcome any feedback on my comments.