Hi! Helena here, almost middle-aged (ouch!) single mum have made a lot of sacrifices over the years and have a bit saved up for an investment property. I'm new to this so just looking to learn, not "get rich quick".
Hi Helena a few tips I would tell my past self 1) Have a read of Barefoot investor 2018 a great read with lots great advise. 2) Become an expert of a suburb in your price range as close to the city center/satellite city as possible by going to every house that's up for sale over the next 12 months. 3) Find an accountant and keep it SIMPLE with the structure they suggest. 4) Enjoy as much time with your kids and get them involved.
Middle age is 45 to 65, if your username is anything to go by, you are fair few years away from 45 Pick up any book on property or magazines and start reading up. Important thing is to ask lots and lots of questions and the PC community will rarely let you down. Good luck.
Welcome Helena!!!! Keep the faith. As a long term sole parent with my youngest just shy of adulthood, I never dreamed I would find myself in the comfortable position I’m in! Possibly not the comfort level of other people but I remember the kids and I dragging stuff home from the bulk pick up and selling them on Gumtree! Character building! Have a look at a website called a Simple Savings, in addition to this incredibly informative site, you’ll be surprised how much you can slash your non discretionary expenses, and good luck,
Welcome to the forum. Congrats on having saved a deposit and thinking about what to do with it. There is a lot of information on the forum and it might seem a bit overwhelming at first so read a bit, digest, then read again. There is no rush and it's best to get the right knowledge before you make your first purchase.
Thanks very much to all of you! I didn't think I'd even get a reply! What do the experienced people here think of the Perth market? It has basically stagnated for almost the last 10 years and now the median looks decent value compared to historical averages of some of the other states. At least that's what it seems to me and of course living here I know the suburbs relatively well, good schools etc. I've also been reading here on PC that Brisbane could be picking up over the next few years but I wouldn't have an idea about which areas to focus on. I'm open to the idea of using a buyer's agent but have no idea which ones are good, reputable etc. Finally (for now!) my goal is mainly capital growth. I'm ok with wearing a bit of pain with low rent on the basis that most of my investment is made up of land value rather than a high value house on a small block. I work full time and at this stage don't feel like I'm even close to ready to think about strategies such as sub-dividing, building a house, or even adding value with renovations. I'm fortunate enough to have my small house already paid off, mostly through fortune of buying well before Perth's boom, and a bit of grit working hard, saving hard, and commonsense of living well within my means. As mentioned I've saved up a bit but to explain further, it's not quite cash but mainly sitting in an index fund so easily liquidable. It is currently worth about $300k, again through some fortune and good timing of putting some money into a US S&P500 tracking index fund after the S&P500 fell in 2008 and I bought in end of 2009 thinking it looked cheap, and also the Aussie dollar looked historically strong at 90 cents to the USD. So lucked out with the US market gaining a lot since then while at same time the AUD fell. Now, while I personally think the US market has a bit more steam left in it, I'm getting very nervous. The economy there seems like it's more or less peaked, so while things are still good there, it seems like there's only one way next - down. The market is also tending to rise lately on barely any good news which is never a positive thing. So I'm looking to potentially exit the US market soon, knowing full well I might be leaving something on the table but you know the saying it's difficult to pick the tops and bottoms, you can only act on where in the cycle you think it is. Based on this, I'm tending towards a strategy, as an alternative to just putting cash in the bank and having that degrade slowly due to tax and inflation, to buy and hold a property with a decent amount of land (600+ sqm) with some small rent for a few years hoping that it will perform better in capital growth than had I just left the money in the US market index fund. Sorry for such a long winded post, please let me know if it should be in a different section of the forum and I'll repost there. Thank you!
Congratulations on a paid off PPOR. Perth wasn't stagnant for the last 10 years. Some people (including myself) made money in the last mini boom. Catch-up with the conversation over here: Post a Bargain - Perth 2019 [WA]
Congratulations - that is a wonderful nest egg! Although some of Perth is the same price it was 10yrs ago like the stock market it has gone up and down during that time. Will you also borrow money to buy something more than $300k here? I would advise to get some professional tax advice on how to get a loan in the most tax effective way rather than just using your current house as collateral.
Happy days! Here I was thinking I'm now officially middle aged, and it turns out I've still got 4 years to go!
You've done bloody amazing! Well done! It may feel like it's been luck, but luck only happens when you're brave enough to be in the game so don't discount the fact you've taken WAY more steps than most people and are seeing the rewards of that. I've got my eyes on the US too - 10 years of bull market can only end one way I reckon...just a matter of time. But, having said that I know people who've been calling the top since 2013, sooo...
The most amount of time between each recession in the US seems to be about 10 years so ... List of recessions in the United States - Wikipedia
Thank you. Yes I was going to borrow using some or all of the $300k and my house as collateral. I don't want to over stretch but would consider going up to $850k for the right land package in the right area. Thank you for the suggestion on the looking at better ways for tax restructuring. Though I'm not on a high tax bracket so not sure if it makes much difference for me.
Thank you Jess. Yes the bull market in the US could go on for years more but what worries me is the longer it goes, the bigger the pop.
With a deposit like that you won't need to put your house up as collateral, so please don't do that. The bank would of course love so much if you did, b/c it sures up their position but its not in your best interests. You could also not use a cent of your managed funds, either if your didn't want to. If you're in accumulation phase ideally you'd not sell any until you had too. If a crash was a concern you could buy some puts to protect your capital, if you wanted to avoid CTG on the funds.
Amazing what difference almost a year makes. Well I haven't bought a property in either Perth or Brisbane but I did sell out of my US S&P500 ETF just after Christmas and go fully into cash. Was supposed to get out earlier but procrastinated. Watched the index go up another 200 points after I sold and wondered if I had made the right decision but for me it was about risk minimisation as I was quite convinced that the US was at peak economy even without the whole coronavirus thing. I'm still convinced that there's a bit more to fall but I've started averaging in now slowly at the lower prices. Think it might be a while longer before I get into an investment property but at least I've got some time to research on here! Still looking at Perth and Brisbane.
I suspect there'll be some good opportunities in Perth after all this blows over. Hell, even during if you're feeling brave.
