Where to buy first investment property

[Sheenz]

Hi All

Just joined to seek advise, I'm looking to buy my first investment property.
Bit about me:
In my mid 30's, no debt. Currently renting and working in Sydney, looking for IP for couple of reasons
1. Get myself into property market
2. Save on tax


Been looking into western Sydney (Doonside, MT Druitt, ST Marys, Kellyville) for a good piece of land initally I was looking at 900+Sqm but I guess Ive missed the boat and the property prices have sky rocketed, dont mind jumping into this hot market that I think will stay like this for another few years but then what? Other options is Northmead

I have also looked into Frankston, Frankston North (Victoria)

Thinking of Central Coast maybe

I'm open to investing in QLD, Vic, NSW

 

[jippa3000]

Welcome Sheenz,

Other than what you have stated what do you want to achieve from the property?
Is this the only one you want to purchase or do you want multiple?
Have you thought of or seen any strategies that you like maybe from reading posts on here?

 

[Sheenz]

Thanks James,

At this stage I would like to take a step at a time, so buy my first investment property initially and maybe in 12 months to 18 months look into buying another and building on. Maybe second property in regional area with some +ve cash flow (if possible) but first one most likely -ve gear and hope on capital growth.

 

[jippa3000]

Have a read through some of the interviews on here, see what people have done and try to get some sort of end goal in mind. This will help you choose your first property with a bit more knowledge. The first one can be make or break depending on your situation as to how quickly you purchase the second so it does need some thought.

I can only comment on Vic, so Frankston North is a while off for cap growth and the council is a pain to deal with to get any sort of approvals through.
I'd be looking at buying something new, save on stamps, less maintenance issues, builders warranty, easier to rent.

Cheers

 

[Ace in the Hole]

Hi All

Just joined to seek advise, I'm looking to buy my first investment property.
Bit about me:
In my mid 30's, no debt. Currently renting and working in Sydney, looking for IP for couple of reasons
1. Get myself into property market
2. Save on tax

first one most likely -ve gear and hope on capital growth.

This is not a personal attack, but the bits in red are terrible reasons, in my opinion.
You'd be doing yourself a massive favor if you get a lot more clear on your investment goals before taking any further action.

Keep reading and learning.

 

[marty998]

Yep.. in my mind negative gearing is a cash-flow outcome/result, not an investment strategy.

 

[nomadic]

Buy on the Gold Coast.

 

[windyzz]

Northmead is a very good area, close to Hills district and parramatta

House price is already sky rocketed though, but the apartment prices is still reasonable

 

[Rixter]

I'm open to investing in QLD, Vic, NSW

Hi Sheenz,

Welcome to the good ship SS forum, setting 'sale' to your dream destination.

What and where to buy is dependent upon your chosen investment strategy.

You see property is merely the vehicle. The strategy is how you intend driving that vehicle.

Unfortunately the mistake I see newbies and sometimes not so newbies is that they are property focused instead of strategy focused which is like putting the cart before the horse.

Property investing is not about property rather about the strategy and the way you intend to use the vehicle to get to where you are wanting to go. No good buying a small shopping car if you intend driving interstate on a family holiday.

What strategy/s are best for you is determined by where you are wanting to go, the time frame you want to get there in and how hands on along the way - all based around your personal risk profile.

I hope this provides some food for thought.

What is your chosen investment strategy?

 

[pickle pickle]

I personally prefer the stock market (decent blue chip shares with a market cap of at least a $1 billion) than property but that's just me.

The only advantage I see with property is you can levarge more than shares. Rest of investments in property are just negative compared to shares. IE. taxes (land tax and rates, less liquid, repairs issues, etc)

However if you want a property the area I know is Victoria. I like Ballarat (especially Wendouree area as you can buy a decent block and house for under $200k and it is near a train station to Melbourne) and Western and Northern suburbs of Melbourne (Sunshine, St Albans (near the station) and Dallas. Melton may also have some potential (but only walking distance from Station, otherwise Melton has way too much land available).

 

[Sheenz]

Thanks Rick and others for your feedback. I know its a learning process for me and thats the reason Im here.

few of you have asked about strategy/s. I'm not sure what strategy I should look into, All I want is buy a good piece of land with some okiesh house on it that I can down the track renovate but that will give me a reasonable rental income and will grow in value in 5-8 yrs.

I would like to buy second investment property in 12-18 months time mainly depended on the outcome of the first property as they say first property can either break you or make you. Maybe a cheap one in regional area to have +ve cash flow.

I guess out come of all strategies are be to be able to have comfortable life style and create good wealth.

Please let me know if there are some other strategies I should look or consider.

Cheers/

 

[wombat777]

Perhaps come up with goals that are a bit more targetted such as "replace my salary income with a passive income within 15 years".

From there try doing some forecasts based on different strategies to see how you could achieve that goal. Think of scenarios assumptions of where you will buy the properties, when you will buy them and the frequency of buying ( needs to be based on affordability ), how much they will cost, how much they will cost to hold, how long you will hold them for, how much they will grow ( best to be conservative ), how much rent will grow ( best to be conservative ), etc, etc.

You can also bring savings and other forms of investment into the mix with your overall forecasting, as that will affect when you can build further deposits to buy additional properties.

It helps if you are a dab-hand with excel, etc. There are templates around that help.

There is a free template here to get you started

http://www.investmentpropertycalculator.com.au/free-investment-property-calculator.html

 

[Richard Feynman]

(no seagulls yet?)

The others have made valuable contributions. It's important to work out what your goal is and go backwards from there. Whether it's to have $2mil equity in 10 years, a passive income of $75,000 in 15 years, or $30mil of assets in 20 years.

Your goal may shift (in all honestly, it probably will) but setting where you want to get to (even if it's vague) allows you to start taking steps towards that end. Refine as you go.

As Ace said, keep reading. Keep asking questions too.

And find a great broker (there are a bunch on here, no doubt a couple will pop by). A great broker will help map out your journey/strategy including giving you an idea of borrowing capacity and how far you can go based on different scenarios.

 

[Rixter]

I guess out come of all strategies are be to be able to have comfortable life style and create good wealth./

Great, now you're starting to look at the big picture or in other words your destination where you want to end up....

So, next you need to define what 'Comfortable Lifestyle and Good Wealth' is to you? To simply say comfortable lifestyle and good wealth' is too wishy washy.

You need be 'specific' as to what that means to you. Quantify it then attach an annual income figure to it and also a date by which you want to attain it by?

You need to commit this to paper in writing... once you've done this you can move onto the next step in the wealth creation process.

 

[jpcashflow]

Hi

Hi,

Good luck on your first IP there are plenty of people on here who have so much experience

In terms of buying an IP for tax reasons, I would only recommend using the tax reason as a benefit not as a strategy or goal.

Paying tax means you are making money, simple as that but as you grow your portfolio then you look at other strategies to minimize tax.

Cheers