Hello all,
I have been searching to buy a house to live in soon, however I recently discovered this site and now have some serious questions to answer…perhaps you can offer your perspective?
Basically, I currently rent in Perth and know that I will be transferred east in 2/3 years. My original plan was to buy a house ($260K-ish) to live in, build up a little equity then when I move east it will become (shock! horror!) a -ve geared investment property. I will be able to get the FHOG plus an $11,400 grant from my employer to cover costs of a home purchase. I am working on a deposit, but have a little way to go.
I am now wondering whether it is smarter to continue to rent for the duration of my time in the west, and instead buy +ve geared investments – (perhaps two to start with) I guess I am a little frustrated by paying rent, but perhaps looking at the big picture it may be the wisest path to follow. Your thoughts?
My long term goals? I wish to develop a large investment real estate portfolio that generates a substantial passive income. Any thoughts and opinions would be muchly appreciated.Cheers!
Hi Foo
Is that transfer in 2 to 3 years or two thirds of this year, if it’s the latter then check your FHOG details to ensure you qualify or don’t have to pay it back when you move.
I have transfered around Aust a few times and made nice tax free money buying my own family home instead of renting (without FHOG or any other assistance). If you buy well you give yourself options:
1.Cash in on FHOG and cap gains tax free profit if you sell
2.When transferring due to work commitments you can claim the property as your place of primary residence for many years even while renting it out.
3.Use the incentives you have mentioned to turn a marginally geared property into a positive geared property
4.or as you have already planned and moreMy first homes were not my ideal family home but because they were short term I settled for less and made more $ long term.
I have learned from experience that the best time to buy was yesterday but don’t rush in and buy today without considering tomorrow.Hope you enjoy my 2 cents worth
KEY
Hi Key,
thanks for your thoughts. For info I am here for 2 to 3 years from now. I like some of your suggestions, I will need to research what tax benefits there are in claiming a WA address as my PPR after I move. I guess the bottom line is that if I do purchase a place here, I need to do so with a view of making it a place that will bring positive cashflow when I leave. The more I research this site and think about my long term goals, the more apparent it is that having a heavily -ve geared house is a bit of a lemon!
Thanks again for your two cents, if anyone else would like to share their thoughts that would be great…Foo [
]Hi Foo
Some thoughts for you
Any interest on your own home in non deductible , while it is deductible on your investments.
It is possible to rent for less than to buy to own. If the difference is used wisely and religiously then you have a way to fast track.
It all depends on what you want to achieve
Rob
“A bank is a place where where they lend you an umbrella in fair weather and ask for it back when it begins to rain
Hi,
quote:
A bank is a place where where they lend you an umbrella in fair weather and ask for it back when it begins to rainWhat a gem of a saying! And how true.
My advice… don’t confuse a lifestyle decision with an investing decision.
If you want to own a home then that is an emotive decision, not an investing decision. The reverse is also true.
Investing does not come without a cost… only you can determine whether you are willing to pay the price.
Bye
Steve McKnight
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Remember that success comes from doing things differently.
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Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Greetings Steve
one of the best feelings you can have is Knowing that you have a raincoat on underneath
Cheers
Rob“A bank is a place where where they lend you an umbrella in fair weather and ask for it back when it begins to rain
I’m from Melbourne and moved to Sydney four years ago and rented a house straightaway. I looked at buying a house here but soon realised that the cost of renting vs paying back a huge mortgage wasn’t smart. Instead, I’ve used the difference between my rent and what I’d be paying for a mortgage to buy investment properties – two in the last six months, both cashflow positive. So I get to live in a great house in Sydney with the lifestyle I want and build equity in properties paid for by others. I highly recommend this approach.
Thanks McMahon and all,
I have been doing the sums and it would seem pointless to purchase a home at this stage. I don’t have the “emotional attachment” factor here at all, I am waiting to settle back on the east coast later on. Therefore, I guess it would make little sense to throw a significant amount of money away on a PPOR that I know I will move out of anyway. Again, thanks for all the pearls of wisdom.FF
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