$60,000 burning a hole in my pocket. What to buy?

Hey guys,

Done with PPOR purchase and offset is fully funded. Looking for IPs and have 60k just sitting around doing nothing... Any advice? Hang on to it for the inevitable market pull back? Put it into an IP anywhere?

@Lions4Eva @The Y-man

 

That's what I was going to say!

Or it would be a deposit and costs on a property worth $350k. It might be possible to get a 2br apartment in outer Melb suburbs for that. Probably not enough for most of Geelong, but Ballarat is within reach. What about Adelaide or perhaps save a little more and be in a position to buy something a bit more expensive?

Really hard to tell without understanding your serviceability as well.

 

I’ll give you a tutorial on how to spend the money.
Let’s call it the ‘delux’ Training program.

One on one coaching for a couple of weeks.

Transfer the $60k and I’ll give you a receipt. The course will then double as a tax deduction.

Blacky

 

Where do I sign up ?!?!?!

 

Good suggestions @Peter_Tersteeg . Serviceability is good atm. My Australia portfolio LVR is <80% and DSR <90% . Also eligible for waived LMI on 90% LVR loans thanks to my job.

I've been taking time off because my wife and I had a baby. I thought it was time to come back to the forums. Good to see the PC community humor still alive and well haha.

 

I think we are in for a rough ride over the next few months, I would sit on the money [not literally] till later in the year ...

 

@balwoges Any reason to think next few months will be bad?

 

Politics of the time, trade wars which will effect our economy i.e.exports, trade, business, therefore house prices - all unknowns at the moment. Dont have much confidence in our current PM to steer us through stormy waters, feel the same way about Shorten.

 

Save it for your child's education?

 

@MTR @GentleChief I might have to go back home to purchase IPs this year : US - Jumping in the US market in 2018

 

10% + stamp duty on either

1. Completed Property - NRAS 4 bedder in Gosnells WA priced at 470K. 10% + stamp duty = @ 64K
2. Construction (House/Land) non NRAS dual occ in Orange priced at 560K . 10% + stamp duty = @ 60.5K

Both will generate @ 7-8K CF+ if you use I/O , or @ 3-4K CF+ if you set them up as P&I from Day 1

Because you have NIL PPOR mortgage,... borrow 90% . Set the loan as P&I from Day 1. Pay it off in @ 25 years f you just use the rent and surpluses.... but of you are also in a position to make additional extra repayments because your PPOR is paid off, you could pay it off in less than 10 years, meaning you'd have an unencumbered property and an unencumbered investment property generating solid income, within 10 years..

Given the fact your PPR mortgage is paid, I suspect would have the borrowing capacity to harvest equity and buy 3,4 maybe 5 properties using this stucture and strategy.

Set them all up as P&I and just pay them down. No rocket science or guesswork or property cycles of speculation required. Just patience. Fast forward 20 years or so and you'll have an unencumbered PPOR and 4 or 5 unencumbered INV properties . Even with zero growth ( not suggesting it..just pointing out how robust this strategy is) you'll have a passive income for life.

This is why I go on and on about buying cash cows and paying down your PPOR.... once you own your PPOR, the opportunity to go hard and achieve financial independence is turbo charged. Most people spend 20-30 years just getting their PPOR paid off. Just do the numbers ( see above ) and hit GO!

 

If you can get the LMI waived, then your budget is getting close to $400k.

LVR is meaningless for serviceability purposes and DSR isn't a remotely accurate measure of serviceability these days, so make sure you do get qualified advice before committing to anything. Wife maternity leave and a new baby can also mix things up a lot, but congratulations!

From what you've said though, I can't imagine that $400k would be a stretch.

 

Good move Jimmy,
atleast you get paid to be a Landlord!

 

I am loading up... lol .... cashflow is king or queen

 

What'd u end up doing with the 60k?

 

Put some in the market and the rest is still in cash. Some went into shorting the U.S. markets recently so made a decent return on that but sold out so holding onto more cash now... I will either do my research and buy up good companies on the market or buy real estate depending on which one crashes harder first.

 

I can't believe no one said "put it on Black"

 

Put it on red.