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Buying our first IP !

Discussion in 'Introductions' started by Small_investor, 22nd Jun, 2016.

  1. Small_investor

    Small_investor Active Member

    Joined:
    22nd Jun, 2016
    Posts:
    30
    Location:
    melbourne
    Hi there, we are from south east melbourne with PPOR and now looking to buy our first IP in near future. We have equity in our house, which we would like to choose. I would like to start small like buying a unit. I am here to learn as i am complete novice terms of property market.
     
  2. monalisa

    monalisa Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    314
    Location:
    Sydney
    Hi @Small_investor
    Welcome to PC!!
    What would your goal be with the unit you will purchase? It is worthwhile working out your overall goal with real estate investing - I know it is not always easy when starting out, but in my view, first and foremost determine what you are trying to achieve - whether it is passive income or building wealth via investing, and then work backward to determine how you will get there.
    There are a number of strategies one can use - read up in the forum and see what others have done to achieve what you are trying to achieve.
    Talk to other investors, and surround yourself with like minded people - and this is where PC is an excellent resource.
    All the best!
     
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  3. Greyghost

    Greyghost Well-Known Member

    Joined:
    23rd Jun, 2015
    Posts:
    1,262
    Location:
    Melbourne
    If unit is your direction then target:
    1970's built
    These typically have low body Corp costs (no elevators, lifts, rollerdoors, expensive common areas) that will chew up your cashflow
    Are relatively easy to renovate and create equity
    Typically structurally sound (have been solid for almost 50 years). The newer builds today are slapped together.
    No more than 8-10 units on the block
     
  4. Small_investor

    Small_investor Active Member

    Joined:
    22nd Jun, 2016
    Posts:
    30
    Location:
    melbourne
    Thanks for the reply.My goal is passive income in short term and equity over long time. I will be reading the forum very carefully and educate myself. Thanks everyone
     
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  5. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,173
    Location:
    Adelaide, SA
    Welcome to the forum. :)

    What areas have you been looking at in particular?
     
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  6. monalisa

    monalisa Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    314
    Location:
    Sydney
    What budget have you set for your first IP?

    Sounds like you may be looking for a high yielding first investment.

    Where neutral to positively geared, as rents rise it should give you passive income - but unless you got something which had an upside (e.g. dual occupancy), it may be challenging. How much passive income are you looking for?

    Typically you need 20-25 times of paid off income producing assets to have the passive income you are after.

    It is great to have a neutral to positively geared property, as it will assist with servicing your debt, and build a real estate portfolio. However, its important to ensure where you are buying has an upside, and potential for capital growth.

    Good luck!
     
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  7. Small_investor

    Small_investor Active Member

    Joined:
    22nd Jun, 2016
    Posts:
    30
    Location:
    melbourne
    I was looking at Cranbourne,Frankston and Melton. Also,some units in noble park