For me personally we have rented in between 3 properties. The first home we renovated ourselves and made a great profit when we sold it after 5 yrs, enough to build our 2nd home on a huge block of land which we lived in for 2 yrs before selling and making another nice profit. We have almost completed building our 3rd home which we will be renting out We have rented in between each of these homes, a lot of people say its dead money, but for us it was always a cheaper alternative We rent now in the city (the house we are building and renting out is in regional Vic) , so we still have an asset. In 2 years or so we will build again.  I would go with whatever suits you guys best Either way you can still grow your property portfolio

We paid $113,500 for our 1 acre block and built a 4br + study home, we have also put up a large tradeys shed and a large undercover entertaining area. Total cost to do all this $216,500 – so $330,000 in total. It is now on the market for $460,000. With the market being a but up and down at the moment due to interest rates it may take a little longer to sell, but in answer to your question it can be done  
We also put a lot of thought into the house itself and saved money by using a very basic floor plan from a cheaper design but then created out own facade so that it didnt look cheap and nasty.
Be patient to, we have had our land for a few years now, but the current price for the same size block is $150,000, and we have built our house 18 months ago, so it all takes time.
Your venture sounds exicting! Good luck with it all

i think your property sounds ok. You will only be borrowing $150,000 and repayments ( over 25yrs, IO, 7.39%) are around $230 a week (depends of course where you get your loan etc..) rental income is $160 a week so property will be neg- geared, depends of course too on your situation, are u looking for neg- or pos+ geared properties etc.
The first one is always such a big decision!! Is there anything you can do to the property to up the rent?? is that the going rate for rent? will u try and negotiate to get the property cheaper too?? all the best with it, keep us posted

I am in a similar situation with you and am opting for the 105% IO loan, only because I dont have the full cash deposit to put towards it and dont want the IP to get away. If I had the cash deposit I would probably chose the 80% option. The cash I do have is going towards renovations on my own property so I guess in the long run I can still use the equity after reno's to purchase another… all the best with it

Have to add my 2c here as we are in the electrical trade too. My husband prides himself in his electrical work and always cleans up his mess and always respects other peoples homes whether they are old or new. We have renovated and built homes ourselves and have seen first hand how some trademen (not all) basically dont give a toss about other peoples property! We work hard for the things we have and thus respect others. And no, we dont add on extra hours in labour and charge for the mess we clean up. We do it because its the right thing to do and people talk, as u can see from this post. I feel sorry for you poor buggers who saved and were burnt with your reno’s. I guess it is all a learning game and to research your tradey is a brilliant idea, hear first hand from others who have got them to do work before you get them in yourself. But rest assured we arent all like that and some of us do respect other peoples homes like they were our own.[exhappy]

I am new to IP’s too… but wouldnt consider this as an IP, especially if it CF+ you are wanting. I guess it depends how much you like the place, if u really want to stay there, or if it will be easy to find another place. Maybe look for something else to buy that isnt quite as expensive. And they cant just kick you out on the street, so you should have time to consider your options. Good luck with the house hunting…[wink4]

We rent at the moment as we recently renovated and sold our first PPOR. We then moved to a different area and decided it was easier to rent while we got settled and found land to build on etc… There is no way we will stay renting any longer then we have to as I dont see the point in paying a lot of money every week for a place which is never going to be the way you want it. Ours is small and for the owners definately a CF+ investment, I dont see the point in paying off someone elses home when you could be in your own for the same or only a little bit extra dollars. Plus we want to be able to use the equity in our own place to purchase IP’s.

Hi Coops
We recently sold our PPOR through a real estate agent and after they kept their hefty little fee we vowed we would never sell through an agent again. At the time we were unsure we knew what to do and thought the agent would do so much to help us, all they did was keep us in the dark about everything. Apart from organising times for people to look at the place they did nothing else. I personally would’ve preferred to make these arrangements with the interested buyers myself, rather then relaying it through the agent. I am sure there are many many excellent agents out there but we wont use one ever again. Our solicitor did all the necessary paperwork and in the end some of the wheeling and dealing. I say go for it yourselves you will feel more in control of the entire deal. The costs saved will be better off in your pocket….Good luck with it all…[biggrin]