Hi all, I need a bit of advise on next steps for us. Background: We're a young family with 2 kids (6,1) with a mortgage. Total amount remaining around 700k. (equity in PPOR [ Hills district Sydney] approx 250k) Combined income is 250k gross. Also, we've got around 75k set aside for an IP. Question: In terms of next steps, I'm exploring a few options as below a. upgrade current PPOR for a "nicer" place (same suburb) and explore making current PPOR as an IP b. Buy an IP (for around 400-500k) and maintain current PPOR If suggestion is to buy - any suggestions? Currently thinking in either Brisbane or Melbourne. Any particular suburbs that you would recommend? Note: Long-term goal is to have atleast 2 x IPs in the next 5 years. Thanks in advance.
You've asked this question previously? Investing in IP or upgrading PPOR In my opinion you haven't given enough information. What are you actually trying to achieve? Do you NEED to upgrade your PPOR or is the priority to buy investment properties? Where did you get the '2 Investment properties in the next 5 years' from? As in why only 2 and why that time frame? Suggest you sit with a good Financial Planner and work out what you are looking to achieve financially and then come up with a strategy on how best to get there.
Agree with what is said above, you need to be clear on what you want first. To help you to understand at least from a financial point of view read the book below, it may help you to decide? Let me know if you read it and what as a family you decide?
Generally speaking if you are younger and more likely to be in a wealth accumulation phase, then buying would be a better decision because there is income attached, and the window of time you have in life to be accumulating debt and assets is relatively limited. BTW, why wouldn't you buy in IP in Sydney?
Thanks Lindsay. I did (post in the other group) but thought it might not be the right one hence posted here. In response to your Qs. - I don’t NEED to. However current area is good and I expect high growth moving forward so would be an easy decision with minimal risk albeit more financial pressure. - 2 in 5. We’re at a stage where we need to start building wealth. In 5 yrs maybe we may decide to cut down on work and spend more time with kids so could go down that route OR decide to invest more hence trying to take a Short term approach. Thanks for the FP suggestion. Will definitely be looking at that.
I must be honest - definitely leaning towards that. Not thinking about Sydney purely cause I feel it’ll be out of my budget. Happy to get some recommendations if you have on any suburbs I can look at? Thanks.
Bought it 4 years ago. Only since beginning of this year we’ve been a bit more aggressive in paying it down tbh though.
Hi Baggio, As you can see you are getting more questions then answers, basically everyones situation is different so it would be very difficult to give you any sort of real advice other than that you should definitely speak with a good mortgage broker who is a property investor themselves, they will be able to help you map out a strategy that suits your lifestyle and goals. What works for one person may not be what works for another =) Here are some things to think about, your current PPOR is 4 years old and has some significant capital gains already, I would keep that as is and possibly renovate it to better suit your needs. its your biggest asset atm and you get to keep it free from capital gains tax. Buying another property might net you a better tax outcome since your income is quite high. There are plenty of other things to think about as well but it would be best to speak to a professional =)
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