Returning to Oz and wondering what next!

Hi Everyone,

I have just discovered this forum and thought I would introduce myself. Whilst I haven't yet had time to poke around everywhere, it seems there is a great deal of knowledge and a willingness to share.

My wife and I will be returning to Australia in the coming months after spending the last 15 years for myself and 4 years for my wife living abroad. Before getting married my wife had purchased one house and one unit in Brisbane, so we have made a bit of a start in the property investment world, but we still have a lot to learn (the Brissie apartment makes us feel sick)!

We would really like some financial advice as to what to do on our return with a reasonable sum of cash and are wondering whether it would be better to buy a couple of investment properties elsewhere and rent ourselves in Melbourne or just put the cash into a PPR for us to make a home. So recommendations/advice most welcome. I am sure I will find the appropriate location to ask such specific requests, but thought it might help to share our general situation.

Cheers,

Hazey

 

How likely is Melbourne going to be a permanent home for you? I'm guessing your wife is from Brisbane, is there any chance you're likely to move there??? I wouldn't rush into buying a PPOR.

 

Melbourne at this stage is an unlikely permanent place for us to live. Our aim is to finish-up in the Cairns/Port Douglas area, which looked like where we would head now. However, an opportunity too good to refuse in a new career path for me is drawing us in to Melbourne. All going well, we will do 2-5 years in Melbourne and then a transfer to Brisbane in the same industry for 10 years or so before semi-retiring (haha..probably be asked by the government to be working till we are 80 by this stage)!

Too much info? I don't mind a bit of a chat!

 

With a 2-5yr time horizon for buying and selling in MEL you could stand to lose money. I'd be renting in MEL for that period and buying your FNQ PPOR sometime.

 

Chat away!

Unless you are sure to stay in Melb for a long time, I'd consider renting. 2-5 years is a pretty big range and if you ended up moving out after 2 years, selling the melb property might mean losing money or just break even.

 

If we were to purchase in Melbourne, I was thinking we could have it as PPOR then flip to IP once we left? Would then leave us with an IP in a different property market than just BNE/QLD? Or is this stupid for some reason I am yet to learn?

 

That's a good strategy if you pay IO on the loan on the (temporary) MEL PPOR. When it becomes an IP it will have max. tax deductibility on loan interest.

 

It can be a good idea, BUT if your intent is to ultimately have it as an IP, then you need to buy it as you would an IP. PPOR purchases tend to be made on emotions, rather than hard numbers. Your buying criteria can get bent out of shape for a PPOR.

Otherwise, you could rent in Melbourne where you want to live, and while you're there you could scout out an IP, and buy one there. That way you're still diversifying and you're buying with your head, not your heart.

 

@Hazey welcome home..

As others have said Melbourne has grown significantly over the last couple of years...may be worth looking at other regions vastly discussed on the forum. In particular around Brisbane

 

Welcome Home. What are you up to in East Timor?

 

I'm working with a healthcare NGO trying to help develop pathology services. Have you had some work/interests here yourself?