$450k in Equity - How Best to Invest?

Discussion in 'Investment Strategy' started by matt_j, 2nd Mar, 2020.

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  1. matt_j

    matt_j Well-Known Member

    Joined:
    2nd Feb, 2020
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    Location:
    Sydney
    Hi all,

    I'm looking at purchasing an investment property with my partner in Sydney (this would be the first purchase for either of us) and would appreciate some advice. We have engaged financial planners to assist us with this as well, but they cannot advise on property in terms of areas, types of properties to purchase etc.

    Our situation is below:

    - Cash savings - $450k+
    - Combined earnings - Approx $235k pre-tax and pre-bonus, with bonuses adding about $30-35k on top.
    - We are in our early 30s & have no children with no immediate plans to have them.

    We've been looking at areas such as the Inner West & South East of Sydney, and properties were initially apartments but have switched to houses due to our borrowing cap (approx $1.6m). We have some tradies within the family who can help lower renovation costs as well.

    I would also be open to buying a larger block of land and then building 2/3 townhouses on it (depending on location/state). I had not really considered buying outside Sydney but am open to this.

    My gut tells me to purchase an investment property with 20% deposit & invest most of the remaining funds in shares once they have bottomed out in the next few months.

    Would appreciate advice from those with a lot more knowledge than me.

    Thanks in advance
     
  2. Brady

    Brady Well-Known Member

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    Any personal/owner occupied debt?
     
  3. matt_j

    matt_j Well-Known Member

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    No debt for either of us
     
  4. Trainee

    Trainee Well-Known Member

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    If you max out on this purchase, what happens in a few years when you want a ppor? How expensive a ppor would you probably want?
     
  5. matt_j

    matt_j Well-Known Member

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    We are not looking to max out on this purchase (at the moment looking at spending maybe 1.6m inc renos despite having just over 2m in terms of deposit and borrowing cap).

    Happy to not have a PPOR for at least a few years as rentvesting seems to be better financially and for our lifestyle
     
  6. matt_j

    matt_j Well-Known Member

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    Location:
    Sydney
    Just to add we would ideally look to live in the property for a year or so before renting it out if we buy in Sydney and renovate - this would allow us to establish it as our PPOR first