Hi, I am looking for opinions on what other people would do in my position and wether or not my property I currently own is a good decision to hold for a lifetime or sell and relocate my long term investment. I am currently 26, I inherited my mother's property about 3 years ago, I sold that in April 2017 for 660k. After all expenses I was left with about 620k. I invested 100k into cryptocurrency. Watched that turn into 600k and come all the way back down to 40k today. This was from July 2017 to today. (If only I cashed out lol) With the cash from my inheritance I bought an investment propety in Brisbane City on queen street my uncle helped persuade this decision and I am questioning wether it was the right choice. The property consists of a dual key unit one room being a studio room and the bigger room has a kitchen and balcony. It is located on the 25/30th floor you can see a little bit of the river but it is blocked by taller buildings for a clear view. With 1 car park. The building is 20 years old. My rental returns is a fixed income with the hotel of $2350 per month. My Bill's estimates consist of; Council rates: $400 per quarter Body corp: $3900 per quarter Water & serwarage: $500 per quarter Insurance:$300 per year Total costs: $19500 Total return: $28200 Net gross: $8700 roughly I paid $402,500 for the property And current networth is roughly 475k in all assets. I was thinking of giving airbnb a shot with an airbnb manager once my fixed contract runs out June next year, I have recently got a fulltime job with a salary of $65000 + 7k super with 6 weeks leave as of 2 weeks ago back in Darwin after having no job for 2.5 years. My current total monthly income is $6300 from both property and my salary. Eventually I would like to study something in finance and economics or acturial science I havent yet decided. Hopefully next year. I am also trying to decide if I should look at buying another property now that I have stability. I believe I could be rushing this decision but It is definitely something I am aiming for in my near future. So that's my long story short. Hopefully that's enough information. If I left anything Cheers JayK
Heya JayK, Are you saying along with your crypto purchase you also purchased the apartment outright??? Your cost breakdown shows no interest....
There is a 100k or so gap between inheritance after sales costs and new prop + crypto purchase. I'd start educating myself on long term investment vs chasing the latest craze.
I'm definitely not interested into investing more into crypto and have learnt lessons the hard way although I wont be selling my current crypto portfolio I plan on diversifying my new income into different assets aswell.
I have been living beyond my needs and only recently decided to start focusing on my future. I've spent about 100k since my inheritance. I did have a very expensive holiday in europe aswell. Also I have been living of cash for 2.5 years
I'd highly recommend you read Richest Man in Babylon. You'll find you've already broken at least a handful of the rules for wealth accumulation. I would steer away from investing for a year or 2, and spend the time learning to invest. A young guy with cash will usually be lead down some terrible paths. I'd say your uncle was doing the best he could to help with what he knew. Is your uncle wealthy? If yes, was it from real estate? If no, then likely not the guy to learn real estate from.
I’m a pretty straight shooter so don’t take this personally, but the advice you have been getting TO DATE is abysmal. BUT you know what, congrats on you for making the effort to come here and share your story. I can promise from this post your going to have a whole new perspective. I’m not even going to discuss the crypto. You know how ridiculous that “investment” is. The property however is the purpose of this forum and all due respect to your uncle he really let you astray. Here are the lists of mistakes made: - Purchased in a high rise apartment (don’t expect any growth) - Purchase a single bedder in a high rise apartment (even worse) - Purchased an investment outright (there goes any interest taxation benefits) The list goes in but again I applaud you for coming here. The first thing you MUST do is STOP investing anymore of this money into property/shares/crypto and start investing in yourself. I know courses aren’t for everyone but for you I see enormous benefit. You need to start surrounding yourself with people who have talked the talk and can mentor you. It sounds like you want the quick wins but they simply do not exist. Investing is a marathon and you need to prepare. Rest assured, I and everyone on here will be here to answer any of your questions.
The crypto is a tough one. Trends tend to indicate from now until December is when it best performs. I would consider waiting it out until December and seeing how it recovers and then seeing if you can at least soften those losses. If you truly believe in it then have some holdings but make them small. 10k is the max I would personally ever put up in something so speculative (your basically gambling although gambling you can actually have insight so this is worse). I was going to suggest it may be beneficial to move into the apartment but given the job is in Darwin that isn’t possible. I also wouldn’t be running to buy a PPOR in Darwin. So for the time being I would just sit on the Brisbane investment but DO NOT AirBNB it. You need a tenant and consistent income. Your best bet is to just hold that for the time being whilst you educate yourself. Once it passes 12 months you can sell it with a 50% CGT exemption (but I wouldn’t be holding my breath on any). Once you spend the next 12-24 months educating yourself you will understand why that isn’t a great investment and can look to offload and start afresh. It’s actually not all that bad, you could have been talked into buying in a mining town and then it would be a different discussion. This Brisbane property is not a good investment but it’s not horrendous as you can likely get out for the same price you purchased it and just cop the losses of the entry and exit (Maybe 30k).
Without going too far into the numbers, I’d personally sell that IP. It’s very likely not going to perform and the Net yield it’s giving you off $400k is Terrible. Then split that between 2x houses in Brisbane (if serviceability allows) - with that sort of deposit on 2 more houses you may actually end up with the same net cashflow each month however have a larger asset base, a lot more potential for capital growth moving forward. Just my quick thoughts
The best thing your uncle did was force you into purchasing something so you didn’t go out and ‘blow’ your inheritance. Seems like you’ve acknowledged that you were living above your means without employment etc. As others have mentioned, after 12 months, sell that property. Perhaps use a buyers agent on purchasing your next property. It seems to me like you need a ‘set and forget’ investment property until you educate yourself more on investing. Good luck.
