VIC PPOR Advice

Discussion in 'Where to Buy' started by zed_kid, 14th Nov, 2016.

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  1. zed_kid

    zed_kid Well-Known Member

    Joined:
    22nd Oct, 2015
    Posts:
    232
    Location:
    Melbourne
    Hi all,


    Just after some advice on a PPOR. I’ve laid out a couple of scenarios below.


    Scenario 1.

    Purchase price 1.1m – all cash gone towards 10% deposit + stamp duty + LMI + fees

    Serviceability – will be under 33% of take home income on IO loan + offset the rest of take home pay (after bills)

    Location – Ascot Vale, Moonee Pods, Essendon


    Pros – Large PPOR asset base, premium suburbs, if prices continue to boom tax free CG

    Cons – if prices stagnate no funds to invest further. If interest rates go up could get dicey


    Scenario 2.

    Purchase price 0.8m – 10% deposit + stamp duty + LMI + fees

    Serviceability – will be under 22% of take home income on IO loan + offset the rest of take home pay (after bills) + money in the offset from lower purchase price.

    Location – Pascoe Vale (that’s really all I’ve been looking at in that price range) Maybe West Footscray?


    Pros – money in the offset from lower purchase price. Can invest further or renovate / add value. Less fear of rate increase

    Cons – less tax free CG, ego hit due to lesser suburb


    I feel like 2 is the safe bet, but I also would like to just buy a nice PPOR and forget about investing for a while and enjoy more work/life balance in a nice house/suburb. Although investing really doesn’t take much out of me as I actually like it.


    Thoughts?
     
  2. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

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    Location:
    Perth WA + Buderim Qld
    What's your actual servicing like? You may find you can't actually borrow as much as you think. The banks don't work on percentages, so it would be worth finding out your borrowing capacity before you get too far ahead.
     
    Perthguy likes this.
  3. zed_kid

    zed_kid Well-Known Member

    Joined:
    22nd Oct, 2015
    Posts:
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    Location:
    Melbourne
    Approved for 1.3m but that’s scenario 3, I’m not comfortable with borrowing that much, also won’t have enough cash for 10% + stamps etc.
     
  4. hammer

    hammer Well-Known Member

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    Location:
    Darwin
    Don't forget to factor in repairs you didn't plan on or other "issues"....

    Going for broke on a PPOR could be quite stressful if there is something waiting for you to fix.
     
    radson likes this.
  5. radson

    radson Well-Known Member

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    Location:
    Upper Blue Mountains
    Scenario 4 - Rent in Location – Ascot Vale, Moonee Pods, Essendon and invest somewhere else without getting PPOR emotions muddled with your 'investment' considerations.
     
    Beelzebub likes this.
  6. Beelzebub

    Beelzebub Well-Known Member

    Joined:
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    Location:
    Lost
    Working on getting my partner over the line with this one.
     
  7. daiwaqa

    daiwaqa Member

    Joined:
    15th Oct, 2015
    Posts:
    18
    Location:
    vic
    with 1.1m, you will struggle to find a nice PPOR in Ascot Vale, Moonee Pods, Essendon if you are searching for house.
     

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