Thats excellent Richard, will keep you in mind if there are clients that fit this Niche.

Compeltely agree with the Dark Knight!

Agreed with the guys above, might look into a lender who can blend the loan, do the applications all in one residential and commercial, but keeps the rates separate.

Commercial lending is gagging for business so they rates in most cases are lower then residentials.

This means they can look at the scenario with both the commercial and residential hat, rather just being a residential home loans person

Hi dana_c_83,

For a investment it depends what you are personally looking for, there are quite a few school of thoughts on the best ways to invest. Personally if you have enough money and income buy something to start and learn by buying.

My number one rule – take any emotion out of purchasing a investment property it has to be purely financial and logical.Understand this is not advice it is just purely my thought and experience.

Positive geared properties and negative geared properties neither is wrong or better but is subject to your personal financial situation.

Positive geared have worked in the past for people with lower income, it does not have higher equity increase, usually has higher rental yield and allows additional income to purchase more. In this situation you are looking to build up a portfolio of additional income to purchase more properties.

Negative geared is good for stronger incomes who are looking for equity increases and tax deductions from their income.

In responses to your questions
– if the suburb is expensive and you can afford it, there will be less rental vacancies and usually in very populated areas. closer to metro/city areas.
– I personally like up and coming areas which have been ignored
– depending on your situation if you can beat the rush it is always a great investment opportunity, especially if there is future infrastructure or new rail lines etc.
– Close to train stations is always number 1 on my list as a investment, and convenience to commercial or business areas.
– if it is your first investment areas that you know and feel comfortable with is always important. But if you cannot afford it going further out is never a bad idea.
– Areas with strong ethnical areas help as well as they create their own hub/village.
– ideally 2 bedroom wins over 1 but if it is 1 bedroom in the middle or close to the city will outdo a 2 bedroom further out.

We can go on forever which is better, best answer is purchase within your means, purchase in a area which has potential. Avoid any places that is dependant on one industrial income e.g. mining towns.

Hope this helps.

Hi Jojo,

Any additional borrowing is always going to reduce your serviceability for future investments, the bank has already put in calculations that if you earn X you would be able to have the amount Y in funding.

You can increase further funds either on the current loan or a new split it can be used for a renovations as long as there is enough equity. If it is major renovations like extension of a new room etc (non cosmetic) you may need to provide construction documents as supporting information.

If it is small renovations of $50,000 it is a simple cash out, you can even provide some quotes to evidence it. As above it is strctural then more information might be required.

Hope this helps =D

Hi Michael,

The replies above are spot on.

With the broker setting you up with a LOC i believe is a expensive version of standard loan with a redraw facility.
Line of Credit works well for business owners who need to usually multiple daily transaction.
LOC also allows no repayments on this loan and they just it can “capitalise” the interest on top of the loan until it is maxed out.

If you were looking to just increase your loan and obtain funds ready for a property purchase (this being one transaction), creating a new home loan split and increasing with your current lender for a new home loan split would have worked. Your rate would have been half a percent lower, as it would have been classed as part of your home loan.

• This reply was modified 8 years, 9 months ago by  Hank Hong.