Advice for next step

Hey guys, just looking for some advice and anything would be greatly appreciated. I'm Currently married with twins on the way and we live in sydney. unfortunately we missed the boat here and didnt buy as we kept thinking things were over priced. We're currently living with my mum but will be moving out soon as the the family is growing. We bought an ip in brisbane earlier this year in the logan area and currently getting a 7% return on our investment. our current loan on our ip is 321k and the bank valued the property at 415k about three months ago.

Im a licensed builder in both NSW and Qld, Currently have my own concreting buisness and am also a qualified bricklayer. My wife and I would both love to buy a home here in sydney but we both don't think its a good time now as things seem very over priced and it almost feels like the tip of the iceberg. We need to move out in a couple of months and are thinking of renting for a year to see how the market goes. We have 40k set aside as savings and could release some equity for another deposit. We are thinking of buying another ip with the aim of adding some value and yield as we previously did and build up a portfolio.

One thing im worried about is If we buy another ip, its going to limit our capability of possibly buying a ppor in sydney in a years time. I know that investing is all about having a stratedgy, but to be honest we don't currently have one and its something we're working on. I would love to keep investing as my industry really helps with renovations and so on.

there is three ways we can go for here

1) buy another ip and rent in sydney
2) keep saving for now and rent in sydney and look to but in a years time.
3) push our selves now and just try to buy a ppor

Please excuse any ignorance as im all new to this and again any advice would be greatly appreciated.

 

I'd be using the skills you have as a builder - consider doing a project and selling, and repeat.

 

Yeah I think I understand ya. Move in, renovate whilst living there and sell avoiding Captital gains tax. Something to look at. Thanks y-man

 

Thanks terry, it's definitely something I want to do but I'm just weary of the Sydney market whilst doing it. I guess I could do some projects in brisbane. Much thought on the Sydney market?

 

Sydney market is still a good place potentially, but it doesn't have to be in Sydney

 

I was speaking to an agent friend of mine a couple of days ago and his seeing a 50k shortfall between what owners are wanting and what buyers are willing to pay. his telling me things are just not selling and his not the only one. I think buyers confidence is very low at the moment

 

Thanks Terry

 

There will be markets within markets (Micro-markets) that are under performing. Work out where they are and consider purchasing a PPOR to renovate and then sell to raise a capital base which will be CGT free. Rinse and repeat until you have accumulated enough funds for a Sydney PPOR.

 

This happens all the time!

 

Thanks you very much for the advice guys. Very spontaneous but we signed a contract for a property in need of renovations near mt Druitte. Picked it up for 500k. Going to do some work on it and move in for 6 months. Maybe even put a gf on there within that 6 months too. Really appreciate everyone's advice. Thanks

 

And by spontaneous I don't mean it was a informed decision. I checked comparables, made sure the gf would fit, ran figures on the Reno and so in. I think the stamp duty exemption probably got it over the line. Speaking to agents though, it seems to really be more of a buyers market now

 

I'm thinking there's change happening in Mt Druitt area... more owner occupiers buying and coming in... a positive for the area. Even though its quite far west, it's got trains and the M7 and M4 in the area for good access.
Best of luck to you @Joseph33

 

Thanks a lot Gockie I'll try and update in a few months time with how it all went.