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First home buyer - IP or PPOR

Discussion in 'General Property Chat' started by lateboomer, 8th Sep, 2015.

  1. lateboomer

    lateboomer New Member

    Joined:
    8th Sep, 2015
    Posts:
    1
    Location:
    VIC
    I'm looking at purchasing my first property next year. I'm on 75k/pa (excluding super) and will have approximately $125k in savings by year end. I am undecided whether to purchase an IP or PPOR. I currently work/rent in Melbourne CBD and would love to continue doing so. However, this would mean I will have to go the IP route and at 75k/pa, I'll probably have to settle for a more affordable IP place (possibly at 300k-ish) so that I can service the mortgage and pay rent for a city pad ($1.5k/month) at the same time. Therefore, I'm inclined to purchase a PPOR. If it is PPOR, I am looking for a place (possibly villa or unit with 2 bedrooms - will consider 1 bedroom too) around $400k ($500k max) with a short commute to the CBD (possibly inner west - loved Yarraville). Am I doing the "right" thing by going the PPOR route? Thanks in advance.
     
    Last edited: 8th Sep, 2015
  2. eastsider

    eastsider Member

    Joined:
    2nd Aug, 2015
    Posts:
    17
    Location:
    Melbourne
    It depends on how much you like your current life style. Living and working in the city means your travel time is a 10 minute walk to work or a 2 minute tram ride. Living out in the suburbs will increase your travel time to 30 mins each way by public transport and possibly longer in a car. If you don't care about travel time then its time to develop a new lifestyle out in the suburbs. Paying off your own property is better than paying off someone elses....
     
  3. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

    Joined:
    19th Jun, 2015
    Posts:
    1,242
    Location:
    NSW
    At the end of the day it is a personal choice. Many Gen Y's will rent in the city close to their workplace as a life-style choice and invest in an IP in the 'burbs so they have a foot-hold in the market and take advantage of any tax benefits and depreciation available to them by so-doing.