NSW What Would You Do - Which Area?

Hi guys,

Recently stumbled across this forum a few weeks ago, thought i would introduce myself - my name is Dave. I hope someone maybe able to assist and provide advice from their personal experiences.

I'm currently in the process of getting married end of next year, and also purchasing a home. Between now and Nov next year i was hoping to purchase something as an investment until we are ready to move in.

After going backwards and forwards trying to find the best option for our future, i have turned to you guys! My future wife lives in the Ryde area, whilst I'm in Baulkham Hills. We would love to move closer to town, but budget does not allow for this. Ideally want to PP to be $800K (less is always better) but as the market is these days - we may need to stretch given this day and age.

Ideally 2x2x2 is all we would need as newly weds & ideally she doesn't want to be too far out from her family.

Option 1)
High spec tri level townhouse in Northmead 3x2x2 (i would say on the larger side for a townhouse - close to 300sqm livable space) that doesn't require a cent to it. Strata is around mid $500's pq. PP will be around the $800-850K. (Convenient to hop onto M2 to go to city for work)

Option 2)
An older 40-50yr old home around Winston hills. House is on a big block close the 700sqm, Price guide is $830K - auction may pushup to $900K. but the house is run down, and will require about $100K to bring back to life. (I will most likely struggle a bit with this option) (Convenient to hop onto M2 to go to city for work)

Option 3)
Move out further, to the newer areas like Schofields/Riverstone/Boxhill to a new home for around $750K for a 350sqm and a project built home. (Not very convenient to work in the city)

Option 4)
A friend is in a similar boat, so a suggestion was made to buy a DA around the hills area - build a duplex and we keep one each. I know this is easier said than done, but at least the duplex will be completed to our desired finish & will be brand new. But we arent builders - he is a tradie on the other hand.

I should probably advise i work in banking, and can borrow upto 90% without paying LMI, even though 20% + stamp duty is readily available.

I guess my thoughts are do i aim for a property with some higher growth like a home? or do i look at something ready to go and move in. I love the Northmead townhouse idea as it ticks all other boxes, but i don't see it growing as much as the other options.

Thanks in advance!

 

Definitely option 2 - sweat equity is essential when starting out.

 

Agree. Option 2, but confirm what council zoning allows in terms of add-value ( e.g. granny flat or knock down in future and do townhouses ). Also make sure it is within easy walking distance of shops/public transport.

 

How about option 2 in Rydalmere or Silverwater?

Area is primed to boom with the closure of the refinery, Light Rail and close to M4 & Victoria Rd - easy access to Ryde.

 

I agree seems obvious to me I'd go option 2 no doubt

 

Depends on your future goals, but as above option 2 could provide more options for equity to use in for an IP in the future.
Are there any available for option 4? I would have assumed that experienced developers would have already grabbed the viable sites around there.

 

Thanks for the response guys.

Look's like option 2 is very popular! It goes to auction tomorrow night, we have had our eye on it for a few weeks now. Buyer guide is $830K - but i suspect it could be high 8's or low 9's + Stamp Duty. Which is would be way over budget.

RE claim's with a bit of paint and new flooring, rental can be around $550 pw.

An addition a $100K reno would be required to make it comfortable.. Which means i may need to explore the 90% lend route and use the other 10% for renos? But it will be a large mortgage - not sure if i will be able to sustain to be honest. House is in rough shape internally - and i will need to explore structurally.

I looked into this

Aboriginal Heritage Study - Low Sensitivity
Acid sulphate soils 2011 Class 5
Dual Occupancy Prohibited Use
Maximum Building Height 9 metres
Maximum Floor Space Ratio 0.5:1
Minimum Lot Size 550m2 for Subdivision
Parramatta Development Control Plan 2011
Parramatta Local Environmental Plan 2011
R2 Low Density Residential PLEP2011
Section 94A Non-City Centre 2008
Special Character Area Winston Hills
Tree Preservation Order

There is 1 available at the moment, on the higher end of pricing with approval in place. but what does a 4x2x1-2 roughly 250sqm duplex (each) cost these days?

 

If in doubt, probably better to err on the side of caution rather than over-extending yourself.
Plenty of people in Sydney will be finding out the hard way in the next couple of years.

 

Does the house go to Auction tomorrow? It's pretty small for something that might go upwards of $900k. Its like 125sqm internally excluding garage.. Apartment sized :/
Or this that normal for the area? (I haven't look at others)..

That's what I keep telling my brother who has a $1mil mortgage and keeps buying new toys with the money in the offset!

 

I have a different idea - why not buy as an investment somewhere completely different, and rent where you want to live? You might get 2 or even 3 IP's for the same money in Brisbane for eg, with a MUCH better yield. And not buying at the top of the market then either.

Which bank do you work for?

 

I'm doing something similar, rent closer to the city and get more time at home (I live in Kellyville and take the m2) buy an IP and get your feet wet with that and then consider what you would like to do.

Personally in a similar situation, married next year and kids after that.. i don't want to jump into a big Reno etc.

If you have your heart set in living in your own place that's fine though just my 2c

 

+1 for ^this^

For the record I'm option 4 being 2x 3/2/2 duplex.

Also, and maybe it's just me, but 300sqm is a LOT of living space. As a couple you could easily live in 2/3 of that.

 

Ha, I read that as "broker" instead of "brother", was going to say time to get a new broker.
That's how people get in trouble, keep refinancing and spending the equity. Still have to pay it back.

 

I chose Option 2 but personally would not purchase the Winston Hills property you're referring to. Too old and too much time & money required to make it a liveable IP or PPOR. There is plenty of stock in Winston Hills at present and $870-900k should get you something semi-renovated, if you negotiate well.

 

Take on option 4) and ask your tradie friend to help for the building process.

Build the duplex, sell one and keep one. After sell one in profit, re-value your property, access your equity, put the extra cash back to the offset account.

 

I'd go for a house in Winston Hills. $900k is affordable if you consider a budget of at least $1.3m for Castle Hill or Carlingford is required. And use the 90% loan no LMI. You can always put spare funds in the offset.

Edit: you can also try for Rydalmere too if that happens to be in the budget. It has to gentrify. Keep to the residental part of it though. I wouldn't do Silverwater because its industrial.

 

Look for Seven Hills close to Abbott Rd. Should be able to find around 700k mark. Only an extra few mins on m2. Don't rush on the winston hills one. Last thing you want when first married is a mountain of ppor debt that you're stressing about

 

https://www.realestate.com.au/property-house-nsw-lalor+park-123447702

 

You really need to consider how that PPOR debt is going to affect everything else you ever want to do in life - investing may be difficult with that kind of debt, and once kids come along, what's the plan then, if it's a stretch on a double income?

When planning, choose the option that a) allows you to save a reasonable amount of money every pay b) is still manageable if rates rise to 7% c) allows you to reduce the debt asap.

Also, consider things like income protection insurance, or loan insurance - if either of you get ill or injured and can't work, things will get messy. Cover the risks first so whatever you decide you can be confident that it will not be unmanagable.

 

I like this idea, but not being able to inspect/be near the property raises alarms. My old man got burnt once with a property up at QLD he had. The agent looking after the property was claiming no one was living in it - next thing you know someone drives past & there's clearly someone living in it.

Thanks for this i was only drawn to this property as its set up on the higher side near baulkham hills, and no power lines running over it. I noticed a fair bit of this in the area.

The world is getting wiser, if there's opportunity for a duplex - i've noticed the owner is already factoring in a large % of the profit into their favor. But i still like this idea as it gives me the freedom to create my own finishing.

Agreed, it's the only reason i considered winston hills

To be honest, i was thinking of buying Winston Hills - Renovate (add as much value as i can) - Spend a year in it after married & then sell to reduce my debt... Either that, or a granny flat goes in the back - separate them & gain some rental income to cover the mortgage.

EITHER that, or back to option 1 or 4... doesn't seem option 3 is very popular here - doesn't phase me one bit either tbh