VIC If you had $600K cash where would you buy in Vic

Discussion in 'Where to Buy' started by Tania FD, 9th Apr, 2021.

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  1. Tania FD

    Tania FD Member

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    I am seeking advice on the best property investment approach with a budget of $600k (cash - no loan) budget. Excuse the lack of technical proficiency in terminology, but I would ideally like a rental return of $2600-$3000 per month (if possible) in a growth area(s). Is it possible to purchase x2 properties in Ballarat, Bendigo, Greater Geelong area (could borrow a small amount if needed to achieve this). What would you do? Where would you look?
     
  2. Frenchie

    Frenchie Well-Known Member

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    Why without loan? Unless you are not working / retired soon / low income it is usually not the most efficient approach
     
  3. Tania FD

    Tania FD Member

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    To clarify - my strategy is to have a couple of properties that I can use to leverage the income for other properties that are not considered cash flow properties. The 2 properties would be purchased through a "loan structure" so I access $ should I want to change strategies in the future, but there would be minimal to no loan repayments. They are a means to support other investments.
     
  4. Ruby Tuesday

    Ruby Tuesday Well-Known Member

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    Cash is more efficient, than stuffing around and delays with banks, brokers, accountants, agents, paperwork and holding on to telephones. It also gives you an edge over other buyers and ability to offer better terms, you can get a property of the market quicker. You can miss out while waiting for finance and then have to pay a higher price. If you are retiring that is when you may want to use a loan, because you might have trouble getting one after you have bought, and if you do try to get finance after retiring you will need to be very restricted in what you buy , it will probably have to be under way 50% LVR so you would only be able to get 1 instead of 2 or 3 and the required yields have become very hard to get over the last few weeks. As cash flow is required for loans, producing the necessary cash flow for a loan may be a very inefficient use of capital and/or time. It can be much more efficient to sell down high growth assets with resultant poor yield, to pay for and a high yield asset that than allows cash flow, a loan and a lump sum
     
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  5. malleybull

    malleybull Well-Known Member

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    I doubt $600k would get you two properties in those areas. If it did they would be pretty sub par with less than ideal tenants.


    Maybe look in the Latrobe Valley (Moe, Morwell, Traralgon). Could possibly work.
     
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  6. Trainee

    Trainee Well-Known Member

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    Dont understand what any of this means. And usually am pretty savvy with this sort of thing......
     
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  7. Do Androids Dream

    Do Androids Dream Well-Known Member

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    Girl what? :eek:
     
  8. Shazz@

    [email protected] Well-Known Member

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    You could probably build a dual occ in regional NSW, but may have to bump up your budget to $650k. That would get you the rental income you are looking for. I’m thinking port Macquarie could suit your needs.
     
  9. Tania FD

    Tania FD Member

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    Not the most descriptive or helpful comment. Care to elaborate on the emoji form of communication?
     
  10. Tania FD

    Tania FD Member

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    T
    Thank you for your considered reply. I am 40 years old so retirement is a while off. I am opening to hearing of other ways to best leverage my position with the amount of available funds I have right now. Any further suggestions would be welcome.
     
  11. Trainee

    Trainee Well-Known Member

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    Can you describe the ‘loan structure’ you are talking about? Specifically, lvr, redraw, offset, cross col, etc?
     
  12. My House QLD

    My House QLD Well-Known Member Business Member

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    Logan Brisbane! If you're lucky you can still find properties for 300k (houses) and rents are probably 350 a week now.
     
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  13. The Y-man

    The Y-man Moderator Staff Member

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    We were trying to figure out what you were planning to do. My guess from what you wrote:
    • You want to buy 2 properties with no loan, so that rental income can be used as serviceability to then get a loan to buy some CF- properties.
    • You wants to have a CF neutral portfolio so that the first 2 will be "funding" the losses on the CF- properties.
    • I think maybe you mean "trust structure" not "loan structure"
    Would this be correct?

    The Y-man
     
  14. Tania FD

    Tania FD Member

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    The gist is to have an offset account (not sure if it's possible in todays climate but I currently have this structure). This gives me the ability to access funds if need be. The essence is to have a cash flow positive property with minimal to no loan repayments. Rental income to be used for other investments. Hope that makes sense!
     
  15. Tania FD

    Tania FD Member

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    Thanks for your proficiency with words - I don't operate in a world of emojis! As mentioned, this is not my area of expertise hence poor terminology. I am the founder/owner of a health tech company and my world is health and computational sciences so you have been very helpful in putting words to intent. Thanks for trying to understand my sentiment. The current structure I have is an offset account which has worked for me; assuming this structure will work for me in the future. You are correct in your overall description of my strategy.
     
  16. Tania FD

    Tania FD Member

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    Thanks for taking the time to offer feedback. Much appreciated.
     
  17. The Y-man

    The Y-man Moderator Staff Member

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    Personally I would go for part ownership of a commercial / industrial property with those requirements.

    The Y-man