Hi Everyone,
I need some advise on what we should do with our $80k deposit.
We are currently awaiting land to be titled and then build our first home. It may get titled in April -June and have to build within 12 months. As we wait, should we use the deposit and start buying a few positive cashflow properties below $150,000. Our goal is to double our deposit within 6- 12 months.
Single income earner, wife and two kids.
Thank you in advance.
If you use your deposit it will be difficult to double it. You might end up with none for your settlement.
Also from a tax point of view you will have less deposit and therefore need to borrow more for the home and the interest on this would not be deductible.Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
I agree with Terry bit risky – plus I would put the money into your build as soon as you can, it is only a few months away now then once build is done refinance the house hopefully some equity in it, this is all tax deductible if then used for investment properties.
BuyersAgent | Precium
http://www.precium.com.au
Email Me | Phone MeSouth Coast NSW Independent Buyers Agent - Wollongong to Batemans Bay and Regional NSW. DOWNLOAD OUR FREE 14 POINT PROPERTY BUYER'S CHEATSHEET to avoid painful mistakes at precium.com.au
Thank you guys for the advise.
All the best with it @s9nny! Put some progress pics up when you have the house underway we all like to watch :).
BuyersAgent | Precium
http://www.precium.com.au
Email Me | Phone MeSouth Coast NSW Independent Buyers Agent - Wollongong to Batemans Bay and Regional NSW. DOWNLOAD OUR FREE 14 POINT PROPERTY BUYER'S CHEATSHEET to avoid painful mistakes at precium.com.au
Hi Sonny
As the others have said, best to keep your cash for the home you’ll live in.
If you ever do start investing, be wary of property that has a low rental price-tag (which property priced below $150k probably will). Your rent can get severely eroded by bills. Council rates, insurance, water rates, maintenance.
– The water company will normally charge the same service charge for a dwelling that has just 1 bedroom as it would for a 5 bedroom home.
– Council rates and insurance are not necessarily proportional to size of dwelling and rent achieved. Insurance on smaller dwellings is quite ouch.
– You still have to maintain the plumbing, electrics and appliances. If the oven dies, you’ll be looking at $600+. There’s 4 weeks rent chewed up right there. The Hot Water Service will be over $1k. Yes you have to maintain oven and HWS in a bigger property, but bigger property fetches more rent to help pay for these things.
I wouldn’t want something that fetched less than around $200 per week in rent.
Hope this all makes sense.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
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