Hi everyone,
Ive been reading on this forum for a while and the more i read the more i learn, and since im always keen to extract opinions and advice on subjects from people that know more than me…
I purchased a unit in a resort complex about 6 months ago for $261,000 based on my research and the fact that other complexes in nearby suburbs had much larger sales prices (ranging from 300 to 450K) – CG originally my focus. The rent is only $220/week with all outgoings paid (apart from land rates). However the complex is currently undergoing a major refurbish (not at my expense)and based on the work being completed, has been valued at $400,000.
Being my first and so far only IP im paying off as much as humanly possible to get the interest down.
My question i guess really is what possibilities are there when ive paid off enough for it to be CF+? Is it a good idea to keep paying it off to realise larger CF+ or is it a better idea to change to IO and focus my funds into other properties, utilising the equity ive built up in this one?
Im not keen on a sale as i feel the location lends itself to further growth but your opinions on this aspect would also be appreciated.
I look forward to your ideas,
Best regards,
Gmid.My first post… yay!
Hi Gmid,
Sounds like you’ve got an excellent deal. You can always switch to IO whenever to reduce payments so that is up to you.
If you don’t want to sell it, dont, it sounds like you’ve bought an equity goldmine. You could easily use that equity to fund other properties, right now, but don’t be in a rush, in todays turbulent market you could easily undo all the great investing you’ve done so far.Hope this helps…G7
Hi Gmid,
I’m with g7 on this one! Especially if you’re just starting out and learning. This doesn’t mean you stop looking, of corse, but be carefull – not many seasoned investors (not talking about myself) are buying willy-nilly right now. The message I’m getting from them is to really really look at the numbers, and research, research, research!As to refinancing, look at what you can afford (serviceability and debt ratio) rather than what your equity would let you buy.
If you have trouble with those calculations or don’t know how to do them there is plenty of people here that can assist. All the best and keep on going![cowboy2]
Cheers
C@34
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