First post! Hi guys, I've been perusing this forum and found it quite helpful, whilst yesterday with a few spare hours on my hands decided to peruse Lloyd Edge's "positively geared", so I am feeling motivated. A bit of background for me. I am a 29 year old GP who started by buying a 1 bedroom apartment in 2017 off the plan from Poly Horizon in Epping (parents' idea), which is now being managed and holding its own despite covid. It was a fairly low commitment investment. Subsequently, right before covid, I purchased a 4 bedroom house in Smithfield, which I am currently living in. Possibly not the best time to have bought, but I've rented out 3 of the rooms because I felt quite lonely after ending a relatively psychologically abusive relationship - tbh I bought the property so she could move out from her toxic home environment, but yeah, can't change people. Sorry, I digress. From an investing perspective, I now have around 1mil in loans left, about 400k in funds that's split between ETF's/offset accounts, an income of around 400k/annum and rental return of about 50k/ annum, not including outgoings, but hopefully that can give people a general overview of 1. Whether I can afford to invest in more property 2. If so, what I should consider Me personally, I am feeling ambitious, and wouldn't mind taking some risks eg with a development of a duplex on some land, which seems to be a fairly mild way to get into developments. Areas I've looked into are Campbelltown (Work around here), Penrith, Smithfield/Fairfield I'd like to invest in my home city but am open to interstate. Other sources have advised to consider buyers agents and multiple low price units to generate positive cash flow, and I'm kind of just here feeling like there's many potential roads to take but wanting to go down the right one Any advice would be much appreciated, and I apologise if my post is too non specific or newbie
Better focus on your job, avoid development and just invest passively. You have high borrowing power, so start saving for the deposit. I just bought in Brisbane, I think it’s more ‘investable’ compared to Melbourne and Sydney at the moment. Engage a local buyer’s agent to give you ideas of what and where to buy and don’t buy sight unseen. This is essential!
Hiya Welcome to the ZOO whats your end game here ? This will help draw a plan as to what you really want, vs what you think you SHOULD want, and will provide some clarity ta rolf
That's a good call, I will continue to work hard during my full time job and try to invest without taking away from my career Thank you for asking, in all honesty I haven't thought of a particular end game, but possibly having a passive income that matches my current active income would be enticing. I see myself plateauing in my career and want to grow financially and also as a person. Over the past year I have become almost obsessed with watches, and I felt like as fun as the hobby is, if I invest that amount of effort into real estate, that may be more productive. At current, part time property development would be my goal, as I find helping people is a long term passion that would be difficult to let go of. I do worry that I will not have a competitive edge in that regard, communication eg. with builders / council / lawyers would be vastly limited if I am only able to reply after work.
hah... I was into watches as well a few years back around your age. Then one day I watched my toddler daughter ditched my Patek to go hug her new rainbow unicorn doll. I realized then they really don’t mean much lol So yeah, many people are successful from property development. But without experience, I suggest you start small, like subdivision, then develop the house at the back or a few townhouses. And you might need a development manager, townplanner, the right builder etc. That’s of course if you’re dead set want to get into development. Otherwise, investing passively will get you to your goal as well over the years. After you accumulate enough capital gains, sell down to cover your loans while still holding rental income to match your current. Befriend good mortgage brokers like Rolf, who can get you highest borrowing power with the lowest interest rates but don’t over leverage. And of course, savvy accountant to help you plan your property investing strategies. Good luck!
Welcome. We are retired, and have just done our first development (probably our only development). We've turned two rental incomes into six by adding four townhouses to what used to be two large blocks. It cost a lot to build, more than anticipated, and we found problems along the way. Most problems can be resolved, but it often takes money, more than we thought. And we are nearly finished. But the extra income stream is going to be nice, and pay off our debt over the next several years. I thought about project managing it myself. We have many renovations under our belts, and know our way around a Queenslander, tools, paintbrushes etc, but we hired a project manager instead. Thank goodness!!! There is so much more involved in developing than simply renovating. I couldn't have coped (I realise now). Throw in family dramas and health issues, and I'm so glad we have someone doing the hard work for us. Worth every cent. So my suggestion would be to work out what your end goal is (as mentioned above) and work towards that. Perhaps you want a decent income stream, that, rather than replacing your high income, might allow you to work only four days a week, or three. You have future partners ahead, possibly future children still to come. Life will change so much, so perhaps you need flexibility, but you sound like you have your head screwed on right, and just need to work out what you really want in your future.
maintain this and increase it exponentially. This will give you cash and serviceability. Buy good CG properties with sub division and development potential. Do development when you have free time.
Any pro tips on subdivision? I am definitely contemplating that as it seems relatively low effort / cost and can also provide some yield What is the way of maximising due diligence? Or, more simply, who are the people I should get to know well when it comes to developing aside from a great mortgage broker / accountant? Because from what I understand, this venture is less luck and more planning/skill, so I want to learn. Thank you for the advice! I will add "Great project manager" to the list of people I need to get to know. Did you end up going with one of the big building companies, or is the general consensus favouring someone more boutique? This may be a very novice question, but do I ask the council before purchase about whether a property has sub division / development potential before offering / bidding? I think I came by some overlay maps for Brisbane before, but that's just one of the many aspects to consider right?
