Hi all, I currently live in Canberra. Aspiring first homebuyer. Secure job, minimal expenses. Living in very affordable flat share. Currently 50k in the bank. Can probably add 30k a year in savings. What would you do?
Hiya Are you thinking of buying in Canberra? If so - my only comment would be to avoid apartments and possibly townhouses. Cheers Jamie
Would probably keep renting cheaply and invest in places where you wont get strangled by land tax and poor tenancy legislation
If you are a FHB and you want to your own house to live in in Canberra, your entry point for a house is going to be 500k in a cheaper suburb. I would keep saving until you can comfortably get a 20% deposit plus change. I agree with Jamie to buy a house not a townhouse/apartment as capital growth over the long term will be much better. I also agree if want to invest the money in an IP and keep renting in Canberra then look elsewhere to invest for your first property in order to keep holding costs down. Brisbane would be my first choice.
It really depends on you own personal circumstances. If you are willing, I would actually reccomend looking over the border at QBN / Jerrabomberra, etc. So you can avoid being gouged by the ACT rates (and land tax if using for an investment property). But there may be 101 reasons why you may or may not be willing to look outside of ACT. If you just want an IP, I really do reccomend looking elsewhere though. If you want something to move into (either now or in the future) then obviously you may be more restricted in where you choose due to lifestyle factors. I also generally would reccomend a house over a unit (unless you can own the entire set of units). But that's probably a bit of my own bias. I personally don't like units or anything with a body corp, because again that just adds to the costs. Just a couple of months ago I checked out a unit here in ACT for an IP, because it had a 16% rental yield. But then I done the math on it and figured out it would still actually end up negatively geared, due to the rates, land tax, body corp fees, etc. With zero mortgage on it at all, 52% of the rental income would have been going towards those other costs. And there was little prospect of CG, because of the age of the building in general and the flood of other newer units on the market. I can find a lot better returns on my money outside of ACT. So really make sure you do the math before you consider anything.
Yep it's crazy :-( You'll get slugged for rates, land tax and body corp.....and that body corp fee will usually keep creeping up. Cheers Jamie
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