Long term PPOR in Sydney vs IP in Brisbane

I think that's a good idea, if you can rent something at half the cost of paying interest than that is a lot less pressure on yourself and family. With prices stabilising and declining and on top of the muddling from APRA and the Royal commission, it would be pretty hard for Sydney to grow anywhere close to what it was before as the majority include those families with double high income that does not have the serviceability to have a million dollar loans. I've seen people often have a limited mindset that they need to own their own home and deep regretting it after bought it because for one they are under significant pressure with huge loan, secondly the amount of money and time they need to fix up random things, 3rdly the house did not meet their romantic expectations and not convenient enough. It's much better to try it out first and when you are happy with the suburb you can keep an eye on any sales in the neighborhood.

 

Ok. Thanks for providing more info. Since your kids are very young, rent in Baulkham Hills as you said. Then you have a long time until either are high school age. While you live in Baulkham Hills then make a list of schools you like and then see if you can buy in any of their catchments (without buying on a main road)

Re: now... where's the 750k PPOR?

Personally... if I was to buy again I would go inner Brisbane, Geelong or West Melbourne (but probably too late for western Melbourne now).
Or consider Perth? It should start going up again sometime.

Otherwise don't buy and sell any properties... its a very expensive exercise and tenants and maintenance are annoying. Perhaps keep the 2 you have if the 750k property is easy to rent out and has growth potential.

No crystal ball though.

 

it's in Quakers Hill.

 

Maybe keep to rent out.

End of the day though... its your decision.

 

If you can manage to buy your dream PPOR in Sydney in your chosen school catchment then I would go all out for it.

If possible, live in it long enough to establish PPOR status, then if necessary rent it out for up to 6 years and rent somewhere cheaper.

Trying to predict better future capital gain between cities is crystal ball stuff. Buying and selling incur considerable costs which must be taken into account.

Sydney always has been (except for a brief peak by Perth), and most probably always will be, the most expensive Australian city for real estate, so buying sooner rather than later makes sense if that is where you will reside long-term.

A PPOR is an emotional as well as financial decision, especially when children are involved.
Marg

 

With the current climate of tight credit, and will mostly getting even tighter due to Royal Commission, I would focus on upgrading PPOR in Sydney if possible. At least OP knows where to buy and has Sydney knowledge.

Depending on the number of bedroom requirements, anything in CTHS zoning is a great buy, except anything that is near the bug powerlines. The new train open ling next year will keep the house value high.

Given you want to live at Baulkham Hills, I assume that you want your kid to go to Matthew Pearce? Note that Baulkham Hills High is fully selective and cannot be enrolled by catchment, only via selective exams.

 

+1.

 

For 900k, opt for house or large townhouse in blue chip or neighbouring in Brisbane.
Brisbane is counter cyclical to Sydney, and given the OP is already invested in Sydney, the diversification benefits should help.
The growth left on the table in Brisbane is more than Sydney percentage wise in the next 5-7 years.

 

In addition to buying/ selling assets, I have other problem i.e land tax issue in NSW as per this thread.
I need to do detailed cost vs benefit analysis before taking any decision and it might be 12 months before I buy anything. It's frustrating but I think this is how things work in RE.

Since my 1.2 M budget, I am not sure if I can get anything near CTHS. It seems 1.2 M is kind of minimum price in my target suburbs like Asquith, Carlingford, Castle Hill, Cherrybrook,Hornsby, Normanhurst, North Rocks,Pennant Hills,Thornleig, West Pennant Hills, Balkham Hills.

I need to pick the area in my budget where there is a good non selective high school in case kids won't make to selective and public transport. Anyway I have decided to rent during kids primary.

 

For 1.2M at CTHS zone, you would be looking at 3 bedroom Duplexes .... No strata fee for those:

2/228 Purchase Rd, Cherrybrook, NSW 2126 - Property Details
10 Northcott Way, Cherrybrook, NSW 2126 - Property Details

Or houses closer to high power lines:

30 Francis Greenway Drive, Cherrybrook, NSW 2126 - Property Details

Or something that need serious renovation:

38 Torrens Pl, Cherrybrook, NSW 2126 - Property Details

 

Do you have girls or boys or both? (It makes a difference). Possibly Asquith is too far north.

 

Prices in Sydney are insane looking in from the outside , $1.2milion for something below average in a suburb some 30km from the city? Wow

 

Even relatively undesirable suburbs have hit $1 mill as a median. For the cheapest suburbs for a freestanding house you are looking at 600k entry.
If you own house on land pre boom... all good. You are laughing. If you don't, it's not so good.

Many FHBs end up buying apartment. A 1 bedroom apartment in a good suburb will be at least 600k. 2 bedroom apartment in a fairly normal suburb would be 550k.

 

Yeah op can probably get something below 1m pretty soon once the fear and forced selling set in. Only problem will be financing , as current ppor might not be worth as much in a year's time and as more tightening happens banks wise.

Seriously doubt there will be much growth in Brisbane going forward. Commonwealth games are over as well and not much growth has happened since the new year. Homes in my heavily owner occupier suburb are now sitting much longer on the market. Can only see prices dropping soon in Brisbane as well

 

I think credit rationing is killing just about all the markets. Banks will heavily focus on PPOR loans hence better to focus on upgrade than buying IP.

 

I'm doubtful the suburbs he wants to buy into would drop to anything like a mill though.

 

Give it a year and we'll see

I was also pretty doubtful the royal commission was gonna happen. Look what's happened now and even SM is changing his tune...

 

I'll bet you. Criteria. Median values of houses for those suburbs as per RP data. If at least 2 of them drop to less than 1 mill for the suburbs he specified, you win. If not, I win.
I'm thinking prices won't vary anywhere near enough for any of them to be at or under 1mill in 1 years time.

 

I tend to think the suburbs the OP wants to buy into are very sought after. Why?
1. Upgraders (from the West and South West) and migrants want to buy here.
2. The new train line will continue to attract buyers into the area.
3. You have North Connex happening soon so that helps the corridor Thornleigh to Normanhurst.
4. This part of Sydney has good land sizes, green and leafy streets and good schools.
5. People would like to buy closer in, but that's even more unaffordable.

Hence, this is why I think the OP's target area is still a solid path of Sydney. It's a good place to live, and not over the top crazy expensive relatively speaking. People happily live in these suburbs till they die....

The cheaper side of the market is supported by FHBs and migrants and they are buying. So upgraders from the southwest and west can cashin and upgrade.

 

Which suburb are you in ?