Absolute Rookies here, any advice much appreciated

Discussion in 'What to buy' started by Klea88, 1st Feb, 2020.

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  1. Klea88

    Klea88 New Member

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    13th Nov, 2019
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    Victoria
    Hi all,

    Wondering if someone could offer some advice.

    My husband and I built the house we are in and are currently paying it off. As we are in our 30s I would love to have an investment as a long term savings goal.

    The opportunity has come up for us to possibly purchase a block of land and we were thinking of purchasing this as an investment...unsure yet as to what we would do with the block.,sit on it for a couple of years/ build and sell it straight away or build and rent it out for a little while. ..,good idea? Or not? Or would it be wiser to just keep paying off our current mortgage??


    We are new to the investing game and just wanted to know what sort of hidden taxes etc may be involved if we went ahead and purchased so we could consider if it would be worth our while or not.


    Many thanks for your time,

    Much appreciated
     
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    land generally doesn't produce income and generally you could not deduct interest etc on loans use to buy it. Sitting on land may therefore be costly.
     
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  3. ellejay

    ellejay Well-Known Member

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    As above, I wouldn't buy land unless planning to build quite quickly and/or subdivide. Spend some time learning the basics of property investing before you buy anything (via books, podcasts and forums rather than expensive courses).
     
  4. TMNT

    TMNT Well-Known Member

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    And hurt your bum
     
  5. kierank

    kierank Well-Known Member

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    Are you paying it off or putting the funds in an Offset?
     
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  6. Trainee

    Trainee Well-Known Member

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    Its funny, but no interest group has any incentive to show people how to properly use offset accounts? And most people would screw it up anyway.
     
  7. Omnidragon

    Omnidragon Well-Known Member

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    Well generally there’s 3-4 ways to make money
    PE rerating (yield compression)
    Rerating of per/sqm price
    Value add (eg permitting, subdivision)

    Identify why you’re buying it first