NSW $1.5M IP

Hi,

If you had up to $1.5M to buy an IP, where would you buy and why? (Preferably Sydney)

 

In a suburb which cost less than $1.5m.

 

Buy 2 in western Sydney. (Eg St Marys surrounds)

Decent yield And some growth prospect as well. If you buy in a suburb around 1.5m you are likely to receive 700 a week from Rent. So the holding cost is just too high in my opinion

 

Baulkham Hills - you might just get a freestanding house in your budget. Baulkham Hills is now over $500k cheaper than next door Castle Hill and given its location, it will catch up sooner or later.

https://www.realestate.com.au/sold/in-baulkham+hills,+nsw+2153/list-1?source=refinement

I would stay away from Western sydney or newer properties in other Hills suburbs. Your other options is Rydalmere, Ermington pocket. It can't stay cheaper with a all the infrastructure happening close by.

 

I would buy 3 properties elsewhere. But that's just me.

 

kogarah brah

 

I would buy 2 x $750K freestanding houses in metro Brisbane

 

I’d get an industrial warehouse with as large land as possible on a 25 year lease. Lock in a tenant and enjoy the positive cashflow.

might be impossible to find something in Sydney now that is freehold, a strata unit would be okay, tho it has less forced upside from land appreciation over a 10+ year outlook. Would definitely be eyeing western Melbourne or around Dandenong, where you can still find yield and a decent land component. Brisbane would be okay too, and more affordable, could probably get two sites with that budget spread over 3 years (after cash flowing hard on the first)

 

If NSW then:

1. Two Western Sydney houses ($750k each)
2. One house in South West - Bankstown etc. plus a “lifestyle” unit

 

Not just you!

 

I will buy 4 to 6 free standing houses. The negative cash flow of a 1.5M residential property could potentially put you under financial stress when the interest rate goes up. A $1.5M house with a decent land size in Sydney can only get you about $700 per week rent.

Even if I have to buy one property with a price tag of $1.5M, I would not buy in Sydney now unless it is a PPOR.

 

Thanks everyone for your responses! Very helpful I was gearing towards 1 property in Sydney for $1.5M, but agree that a diversified portfolio is probably a safer bet.

For those that would buy 2-3 properties, where would you buy?
- NSW: St Mary’s and Surrounds, Campbeltown and Surrounds, Central Coast, Blue Mountains, Richmond ?
- Brisbane: I’m not familiar with suburbs, but I do know there is infrastructure for the metro?

My objective is to look for properties that will have capital growth.

 

While no one can predict the future, this seems like a decent plan.

Also check land tax, it may eat into your cash flow if there are multiple IPs.

I am now leaning to investing $1.5m well heeled regional IP. Southern highlands or central coast. Beats the dead beat unit IP I have atm.

 

I’d skip the units too.
I’d lean towards 2 or 3 houses elsewhere.

 

If it is to be PPOR I would look for suburb with around that median, buying with intention to do a small cosmetic renovation.
If IPs then I would buy probably one in QLD with corner or larger block for future redevelopment in inner or middle BRI and one in NSW to minimize land tax.
But also with a twist and whether a good deal is to be found! Possible change in cosmetic layout say from 2 bed to 3 etc... It is not about just the suburbs, can choose Hills or Inner West, but it is also about the deal and what you wish to achieve. If you can find property say 2/3Bed 1 Bath 1/2Car and can easily change the internal layout say to 3/4BEd 2 Bath 1/2Car and the disparity in price exists for such suburb then there is equity to be made or a potential deal too to add value and increase rent.
Hence it is very hard to advise just on suburbs because RE is also about a deal as a package if you know what you wish to achieve and what strategy for investing you will follow.
Best of luck in what you decide.

 

Any reason why you would stay away from Western Sydney?

 

Thank you all for your feedback! This forum and it's members have helped me immensely with my decisions!! (hope to give back one day!)

Just an update, I have purchased a 4/2/2 home in Greater Springfield Region QLD for $550K on a 600+sqm block (tenanted for $480-$500 pw) and am currently on the hunt for my next one!! Any suggestions would be greatly appreciated

 

i ditto above to buy 2x or 3x houses instead of 1 large 1.5mio places... diversify lease risk and should you need cash you can sell 1 and keep others

 

1 x Western Sydney
2 x Brisbane

Or

2 x Western Sydney
1 x Brisbane