Investment V/S PPOR

Hello Folks,
I finally have saved enough to step foot into the property market. However, I am unable to decide if I should buy the property as PPOR or Investment. My situation is as below:
* Staying in Melbourne CBD, prefer to be in CBD as there is no real reason to move to suburbs honestly.
* Not interested to buy CBD apartments due to low appreciation and high cost of maintenance

Questions for learned members:
* Should I reap benefits of first home and go for PPOR and convert the PPOR to investment couple of years down the line? This allows me to buy a ready house as I save on stamp duty but I need to move out to the PPOR
OR
* Should I go for an investment property. I need to go land and house route since cannot afford stamp duty of a ready house.but allows me to continue in CBD. I can afford to pay the mortgage and rent till the property is ready to be rented.

 

This makes no sense (because you can buy something cheaper) unless you actually have no savings. In which case you shouldn't buy a place at all.

 

I dont want to go with a land parcel below approx 450 m2 mate.

 

This is presented as a personal rather financial decision....

You don't want to leave CBD & don't want to buy there.

You want to buy house/land but don't want to move out to suburbs to live there.

You want to buy property.....

I think you've already answered your own question but are somehow not accepting of it.

What am I missing?

 

What I want to understand is does is make sense financially to start with an investment property and what am I missing out if I do that.
The normal trend and advice (people around me) is to book the benefits of First Home Owner before jumping the investment property bus and couple of them moved to suburbs just so they can claim the benefits of PPOR which makes me think I am missing something.

 

Ok thanks that helps.

PPOR - you get some upfront Government subsidies, no CGT on sale but non-deductible debt.

IP - you get deductible debt, depreciation, tenant paying rent but pay CGT on sale.

That's the short version

 

Are the people around you wealthy?

 

Thanks, appreciate the short summary. Seems it needs some work on my side on the computations before I take a final call
Hope you find to get the time to get the longer verision out soon as I work my way in excel

 

Not wealthy, not poor either, just the average middle class trying to get better

 

And is that what you want to be? Or do you want to be actually wealthy?

Its a serious question. There are too many opinions to consider everything. Choose who you listen to, and care about the opinions of, very carefully.

 

Point taken, that's the reason I reached out to this forum for smart advice

 

Have absolutely no clue on the commercial market, might be a long shot for me. I am happy to learn if you/someone can share some stuff on where to get insights into it along how to go about it.
While the housing market has picked up, isnt the commercial market struggling due to work from home and lower footfalls?

 

No experience with commercial, but a struggling market is better to buy in than a booming one. Whats a better market to buy in, 2017, 2018, 2020 or 2021?

 

True that, be greedy when others are fearful. Commercial is a bigger play though, might need bigger capital, besides need to have some understanding of the commercial markets before investing.

 

If you are open to living in the property, you should see if you can reserve a place in the First Home Loan Deposit Scheme. The government offers a guarantee, so you don't have to pay LMI.

 

Thanks a lot for sharing this.