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Given how much Adelaide grew in the last boom (mostly catch-up growth), I don’t expect there to be terribly much more growth in the next few years. If we get 4-5% growth pa, then I will be very happy.
Remember that, other than in gentrifying areas and other anomalous areas such as along the coast, the next growth spurt will usually happen closer to the CBD and then work its way outwards.
It may be worth trying to buy as close to the CBD as possible now, so that when the next upswing in the market happens, you can borrow against the growth in your property to buy more futher out as the market catches up.
Of course, nothing ever happens the way theory predicts – so it may not work that well this time (heck, look at the current Perth boom – external factors completely messed up the normal actions in that market !!)
And this is just my opinion too !
http://www.invested.com.au … InvestEd :: Teaching Australian’s to Invest
Originally posted by Markat:Mt Barker (as an outer suburb) 30kms out is going to continue to grow and is the fastest growing suburb (in Australia?/Adelaide? can’t remember) and has all the markings of continuining in that vein for sometime yet.
I would still go for inner suburbs though. Clapham is a good one at the moment and also the inner west.
Mt Barker has grown enormously in recent years – there’s been a heap of new development which doesn’t seem to be slowing. The biggest problem is the lack of infrastructure in the town … just going down the shops or to the supermarket is a major pain now!
Clapham is a nice area – just make sure you get a good building inspection done, since some of the properties I’ve seen there have structural problems due to the soil in that area and the construction techniques used in that era. Not something to be overly concerned about – just get it checked out as part of your usual due-dilligence so there aren’t any surprises.
http://www.invested.com.au … InvestEd :: Teaching Australian’s to Invest
Just a couple of useful things to keep in mind.
1. the start date for the 6 years will be the date the property becomes available for rent (ie. is “in the rental market”), regardless of whether it is tenanted yet. This is also the date you can start claiming expenses. Get some tax advice on items such as preparing the property for rent – you may not be able to claim this against income (it may be capital in nature – your advisor will tell you which).
2. if you sell, the end date will be the date of the contract (not settlement), so if you are approaching the 6 year mark – if you can get an unconditional contract for sale before the end of the 6 years from the start date, then you can have a lengthly settlement (if required) without worring about going over the 6 years. Just make sure it does settle if past the 6 year mark – otherwise you may be in for an unexpected CGT bill!
Hope this helps.
http://www.invested.com.au … InvestEd :: Teaching Australian’s to Invest
Originally posted by Markat:Wondering if anyone has ideas/help for equity rich, cash poor investor.
Something that may help is a series of articles written by Steve Navra on “Living on Equity”.
The basic concept is to live on the growth in your portfolio. You only spend a percentage of what your portfolio “earns” so you don’t go backwards by spending too much. Income from the investments is used to service debt. This does of course mean increasing amounts of debt, but it can be a very effective way of accessing the equity for lifestyle.
You can read Steve’s articles on InvestEd – registration is required (it’s free) – http://www.invested.com.au/Articles/LivingOnEquity
The question is though, how long to you intend to live in ths property ? Over the long term, I think the closer you are to the CBD, the better your average growth will be. Sure, some suburbs will have short term spikes in value (gentrification, new services, catchup, etc), but that won’t necessarily help over the long term.
My personal “area” is the inner southern suburbs (no more than 10km out) … but I think the inner west has some good potential too with gentrification continuing. You can buy a nice 3BR place for around $400K within 5-8km from the CBD in the south.
http://www.invested.com.au/ … InvestEd :: Teaching Australian’s to Invest
