Hi from north western Vic

Hi all,

I'm a <30 year old living in the Sunraysia area. I'm late to the idea of investing etc. however I'm keenly reading up and absorbing as much as I can.

I'm in the process of purchasing my PPOR, which is WELL with in my serviceability so I have room to buy an IP in the future.

In the coming years, I plan on buying something <250k that's CF= or CF+
I'm not a big earner, so to start with a CF=/CF+ approach is ideal for me.

I did pick a PPOR that I feel would lend itself to becoming a cash flow rental in the future.
From some initial number crunching I feel it would be cash neutral if it was rented right now.

Are there any CF investors in the Sunraysia area willing to have a chat, or anywhere for that matter?

For now, I have much reading and learning ahead of me!

 

Welcome to the forum

 

Hi @C.C.T

Welcome to the forums and congratulations on your PPOR purchase . The Sunraysia area is lovely. I'm quite familiar with it. I'd be pleased to have a chitchat with you on the phone to help you understand how to set yourself up to head towards your first IP purchase. You're welcome to give me a buzz if you like... my details are below.

 

Welcome @C.C.T . Under 30 isn't late to cotton on the the concept of investing

You'll learn heaps here both reading an asking questions.

If you want a really rough rule of thumb to work out if your PPOR would be cashflow neutral, you'd need to get 7% of the remaining debt on it per year, in rent.

e.g. If you owe $300,000, you'd need about $21,000 in rent (approx $400/week).

Do you have money leftover for a deposit for an IP after buying your PPOR?

 

Hello @C.C.T , welcome aboard.
Where will you be looking for your 1st IP?

 

I'm in Mildura if you want to meet up sometime. No expert though but know the basics. Just read as much as you can on here. Nothing better. It will get addictive. Make sure you use a decent broker when starting. Most on here are more than helpful. Doesn't matter where they are and free to chat and annoy. Good luck.

 

Thank you all.

Thanks for that Steven, by that rule then, it's about 7.5%.
I'd suspect with a few minor cosmetic upgrades it could fetch a bit more.

At this stage I don't have enough to make another purchase, I'd expect to start looking in 12 to 18 months.

If I was to pick an area right now, I'd say it'll be close to home with in the Sunraysia area.
Then possibly in Adelaide and surrounding areas. I understand the general sentiment around Adelaide is a bit bleak at the moment though?

I'm only choosing those areas because I know them relatively well.
With more reading and researching I'd expect my plans to change or my search area to move.
My biggest hurdle would be areas that are affordable to me, <250k.

I'm absolutely keen to chat to anyone who's actively invested in my area?

Touristy, I'll PM you.

Cheers,

 

@C.C.T - sounds like quite a return.

Regarding where you buy, I'd suggest buying where you feel you'll best achieve your goals, not where you currently know well Sounds like you're open to that though so keep reading and learning.

That said, plenty of folks around here are buying in Adelaide. It may not have the same growth drivers are the major capitals, but it is showing promise.

Out of interest, what has determined your budget of <250k?

 

That budget is assumed from my maximum serviceable debt minus what's tied up in my PPOR. It's from what I've put through the calculators on the major bank web pages, maybe it's a bit conservative.

It'll definitely be something to review when I'm looking to buy though.

 

Those online calculators are pretty hopeless–they don't ask for most of stuff that can make a big difference (they might be conservative but they might be too generous depending on your circumstances)

Have a chat to one of the great brokers on here for a clearer idea. It's good to be empowered with some information before you get too far into the research.

I remember a few years ago, going direct to my bank and hearing I could borrow a max of $300k.

Then I spoke to a broker and added about $1mil of IPs to my portfolio.

 

It's not necessarily the best time to invest where you live. While it's good to be familiar with an area, there are more than likely areas that will perform better.
True, Adelaide doesn't look great from a jobs perspective.

 

@Steven Ryan - Thanks Steven. I've got a long way to go, I've only just learnt of the APRA rules since joining the forum, so I'd say I have much more to learn on the financing side!

@Azazel - I think I have the same feeling about Mildura too.
Are you able to share some of your reasoning?
Median prices have been on a steady rise for the past 3 years but from what I gather it's still early on the property clock.
I'd be guessing anyone investing here would be for cash flow, so buying in an already rising market wouldn't be ideal.

 

I have no opinion on Mildura, just saying if we had 100 people from totally different areas in Australia saying it was the right time to buy where they lived, most of them would be wrong.

 

@Azazel - Ahahhh, apologies, I see what you're saying now.

 

No worries.
But by the same token, sometimes it's good to be familiar with an area close to you.