Hey guys, Long time lurker first time poster. Looking to extend my IP portfolio into Punchbowl. Looking to get in on a 2br unit with a large deposit. I should be making a profit off rental income after 5 years (Unit should be fully paid off including interest). I may even double down and buy a couple. General Infrastructure is improving with the m5 along with the new link into the city which will come into effect around 2024. Not too fussed about the area, i know what it's like and i think it has cleaned up big time in the last few years! Regardless, in the long term, i'm hoping gentrification, blue collar flight from other parts of Sydney. I've always valued opinions in this forum, so looking forward to hear your thoughts and opinions. Is this a decent short-term/medium-term play in what appears to be an inflated market? Purchase price around 400k. Cheers!
I'm going to guess you are reasonably young. I suggest you need capital growth and cashflow. Wondering... why would you look to pay it off? Do you already have a paid off PPOR? You can pay it down of course, but with IPs the interest is tax deductible so in the early stages of portfolio growing, I'd want to go big and buy many. I'd also suggest don't put in too much deposit. Also, most people will suggest to not buy in Sydney right now. For 400k though... doesn't sound too bad.
Great points, thanks very much. I guess it's the old school mentality that's been drilled into me from my parents to buy and pay off ASAP. I'll definitely be engaging my accountant to see what options are available! I don't have a paid off property, this will be my first foray into the market hence why i would prefer to keep it local in Sydney. Like you and many others have said, the market these days is redhot but this little pocket of SW Sydney remains a little undervalued. I can definitely afford two, rental clearances in the area are also pretty decent. I guess, my only worry is my portfolio not being diverse enough and being heavily exposed should Punchbowl nose dive.
Diversification happens after you get a foot in the door, land tax won't be an issue for quite a while. Why stop at one in an area when you can become a 'specialist' with more local knowledge than the next punter? After all, you've spent time researching and if you have found value, rinse and repeat.
People will tell you not to buy in Sydney and while this is generally a fair statement, it is important to remember that Sydney is made up of many markets with many different drivers. Personally I believe that Punchbowl is a great area to invest in right now. The Bankstown to Sydenham line is a massive growth corridor for Sydney with huge urban renewal planned as well as the M5 upgrades. Check out the below link and click on the plans for Punchbowl. Good idea to buy close to the station in a small block with largish land and wait for the developers to come knocking Resources - Department of Planning and Environment
Picked it up for 390, pretty cheap IMO. Thanks for the advice and resources. Looks like interesting times ahead for good old punchy.
