First Property in Portfolio

Discussion in 'Investment Strategy' started by jack1591, 12th Mar, 2019.

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  1. jack1591

    jack1591 New Member

    Joined:
    12th Mar, 2019
    Posts:
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    Location:
    Melbourne
    Hi all,
    First message on this forum. Came by the forum on google and thought why not give it a try!

    Wanting to create a property portfolio between 3 of us.
    Will purchase the property in a trust of equal shareholding.

    The goal between us is to accumulate enough equity in the property to be able to leverage increased equity in the property to purchase another one.
    I work for a bank so can leverage to 90% with no LMI (handy in today's market!)

    A few questions:
    What property should I be looking for?
    Do I want capital gain or rental yield - maybe a stupid question, can I have both?
    Is there a state that looks good in the next 3-5 years? Am looking at QLD & TAS..
    Is there a range out of the CBD I should be looking at?

    When looking at the properties that are doing massive yield in TAS, they are suburbs that are in the sticks and are poor places. Is it bad to look at these as the demand to be rented out will be low and thus pointless of holding the property.

    One last question; should I be looking at parcels of land that are >700sq.m?
    That way if cashflow is stronger later on we can look at subdividing the property and building townhouses?

    would love to hear your opinion.
    Thanks guys!!! :)
     
  2. jazzsidana

    jazzsidana Well-Known Member

    Joined:
    27th Jan, 2018
    Posts:
    459
    Location:
    Melbourne
    Do I want capital gain or rental yield - maybe a stupid question, can I have both? - Not a stupid question and yes you can have both but capital growth should be the main focus ...

    Is there a state that looks good in the next 3-5 years? Am looking at QLD & TAS.. - Qld does offer some good buys. I won't rule out SA either. Tasi i'll steer clear off ..

    Is there a range out of the CBD I should be looking at? - Yes but different for different states.

    Should I be looking at parcels of land that are >700sq.m? I'll more focus on unique features of the property based on suburb I am buying in. Boutique apartment building closer to city, something with x-factor in outer suburbs such as subdivision or granny or reno project ...
     
  3. Trainee

    Trainee Well-Known Member

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    24th May, 2017
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    Australia
    Who is the we 3? What sort of trust? How does that affect your individual borrowing capacities?
     
  4. jack1591

    jack1591 New Member

    Joined:
    12th Mar, 2019
    Posts:
    2
    Location:
    Melbourne
    3 of us is father and two sons. Would be a discretionary trust with corporate trustee. All directors on the trustee company and even share in the trust company.

    No problem for individual borrowings. All have ample servicing capacity.

    Thanks for your response!
    Also looking at Geelong and surrounding suburbs. I think this is a boom economy in the next 5-7..
     
  5. Trainee

    Trainee Well-Known Member

    Joined:
    24th May, 2017
    Posts:
    10,258
    Location:
    Australia
    Who would be the appointor? Equal shares in trustee between three people means two people can outvote the third.

    How about for the next property? If you have to all guarantee the loan for this one. How have you assessed borrowing capacity?

    Its the usual problems with buying with others. Change in circumstances. Death. Marriage. Divorce. Illness. Etc do you all own property now?

    Why not buy separately?
     
    Beano likes this.

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