NSW What Would You Do - Which Area?

That's fine. My colleague and his family actually hail from India and his family (parents) are still over there. But my colleague and wants to live here in Sydney, just like many migrants. He has a good job and wants a good school for his son.

Aussie born people though might be more inclined to move up to say Brissie, but migrants are more likely to stick to the city where they migrated to. At least initially.

 

There are no good jobs outside Sydney.
And don't even get me started on the schools.
Canberra is looking more appealing by the day.

 

After going back to the drawing board... i've had to make a few changes...

Option 1:

Purchase a house & land package out at Schofields/Riverstone/Box Hill

Option 2:

Purchase a few $250-300K investments in regional Syd OR maybe explore brisbane... and rent in a neighborhood i prefer.

Option 3:

Purchase a townhouse in the west & possibly 1 investment.

What are your thoughts guys?

 

Not saying the Option 1 is the best option, but if considering it:

• I expect a cheaper entry price into Schofields/Riverstone than into Box Hill (although more prestige / better values north of Windsor Road)
  • if you can't get close to a train station, try to get close to one of the shopping centres
• a new hospital is planned for the Rouse Hill area but not yet announced
• Expansion of Rouse Hill Town Centre will start construction in 2017 ( will double in size )
• If looking at Riverstone, also consider an older/established site close to the future revitalised town centre that is planned ( within 400 to 500m )
  • Blacktown City Council - Riverstone Town Centre Masterplan ( see PDF )

 

New Option 2-
Although I don't know about finding $250-$300 k regional in Sydney?
Brisbane and Adelaide would be great options.

I think 'rentvesting' is a great strategy if currently living in Sydney in this hot (possibly peaked) market.

Yes there's loads of infrastructure in the area and you could still make some
Money, but at the end of the day it's not making money, it's your PPOR, it's a liability until you sell up, and how much more steam is left in this market, you could go backwards or sit stagnant for 7 years?

Having a $700k odd PPOR mortgage can really hold you back especially if your interested in investing, it's a huge amount of debt for your first home, as a banker I'm sure you understand what the interest component of these repayments looks like over the first 10 years?

It also sounds like your not certain exactly where you want to live, if you aren't happy with your choice, you will either
a)sell up- losing your stamp duty and buying expenses along with selling costs, possible even a fall in the market. b)rent it out for a disappointing 3.5% yield.

My views are pretty strong on this as I am in a VERY similar situation, the road I have taken has lead me to buying 3 IP's and I would recommend doing the same.

$290k rents for $340
$310k rents $360
$310k rents $420

In total these look positive but usually net a neutral gearing and a positive cash flow after tax.

So I'm making money in CG
I have a slightly positive cashflow
And I rent in Sydney where I'm not yet sure if/where I want to live.

Renting is also a great way to really understand different suburbs and discover what you and your family want in a house. I easily could have bought any of the houses we have rented but after a few months you learn what you don't like about an area or discover something different you want in a house and select better the next time.

We have lived in castle hill, Northmead, kings Langley and the ponds and learnt a great deal along the way.

The Ponds house recently sold for $870,000 and we are renting for $595 a week, for the purpose of this post I have quickly and roughly done the numbers for this to compare cashflow of owning vs renting-

Council rates $3k p/a
Insurance $2k p/a
Repairs $2k p/a

Owning costs $811 per week
90% lend @ 4.5% IO after a $130,500 buy in (10% deposit and 5% buying expenses)

Renting is $595 a week

Saving of $216 a week and $11,232 p/a

That said- It can be hard going not having a place to call home, and it's perfectly fine for emotions to take over and buy your own home for your family to enjoy if that's what you really want.

But, if your able to delay gratification a bit longer and build the nest egg before enjoying that luxury, my vote is option 2.