I am 23 and finished University two years ago and considering my age have a decent paying job (approx 50K). Since I began working I thought I would do the right thing by putting the majority of my savings into Managed Funds and Shares, however, this approach has left me losing alot of money (on paper) and having only a few thousand in cash. I want to get into propery investment and have seen some of the great success stories on this site and heard many great stories about property investment in general. Any suggestions on how to get into property now considering my financial position of not having much cash up front?
G’day – with $50k/year, you should be able to save $15k in a year ($20k if you’re really frugal), and have a 20% deposit on a cheap country property in 12 mths.
Or you could investigate loans with only 5% down (but see thread re mortgage insurance), so you can get started in under 6 mths.
Peter
Hey there dafledz,
There are many creative ways to get into property with little or no moey down. I would suggest reading Nothing down for the 90’s by Robert Allen.May give you some ideas. Also worth coming to the Masters event to give you more ideas on property.
Hope this helps.
Enjoy
AD [:0)]“Carpe diem, quam minimum credula postero.”
Lat., “Seize the day, put no trust in tomorrow.”
-Horace, Odeshey darfeldz!
I’m in the exact same position!. Finished uni 3 years ago and poured money into international manged funds (me and the other lemings!). Now i’m screwed – big paper loss!. I’m now seeing a finacial advisor to restructure this and have leared a lot on what whent wrong.
And here the thing… although property sounds good now, i still dont want to be a leming and get it wrong again. – this time i’m going to do lots more reading and thinking about my next investment, whatever that be.
IMHO
99.99% of the time financial “advisor”=lemming herder
Be especially wary if they start chalking your losses up to “lack of diversification” or better yet start pulling out phrases like “dollar cost averaging” (based on the wise logic of “it’s plummetting, therefore it MUST be at a good price!”). John Burley, who was one of the leading financial “advisors” for years and knows the industry well, put it nicely when he explained that most “advisors” are merely mutual fund sales people. There are people working as financial advisors who despite the system taught manage to keep their clients best interest at heart, but you’ll have to work to find them. At the very least make sure to get them to disclose in writing the list of commissions and fees they personally stand to make from their possible recommendations and how much money *they personally* have in what they’re reccomending. This last one protects you from crooks, but won’t from people who are just ignorant to better ways.
Good luck!
Quasimodo
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Funny how has a way of answering all of our fearful questions…
___________________________________________________________________________Hi dafeldz,
When choosing an area to invest in, dont forget the ‘rural cities’. I am currently living in Albury (and lived in Wagga for a couple of years). Cities like these dont have the same capital gains that you would achieve in Sydney or Melbourne, but offer great rental returns. A centrally located unit purchased for $75k can return around $130 a week. Newly built homes (for $180k) can return around $250-300 per week. As usual though, if you’re not familiar with the area, try and do some research before you buy. Unfortunately rural cities seem to have bad pockets of housing commission homes scattered around (ie. theyre not contained to one area). Dont trust the agents (!!) – ask around local people, they’ll soon tell you where to avoid. Good luck!Thanks for all of your help. I think it is a great idea for me to see a financial adviser, however, my cynical concern is that all they care about are making commissions. Do any of you guys have any recommendations about some good advisers in Melb?
I also am very interested in investing in rural properties. My question is, how liquid is the rental market in rural cities. I mean, if property only costs 75K, surely it makes sense for most people to be owner-occupiers?
Thanks Again!
Hello Dafeldz, it’s good that you’re wanting to invest early. Our daughter purchased at 21, now 27 and has 2 properties. Re the regional areas, we purchased in north Qld, end of last year, price range from $55000 to $60,000. Rents are $120pw to $135pw. Found them via the net. One was only 5% deposit so you don’t need a lot to start.
Also we went to a financial advisor about 18 months ago, he knew nothing/didn’t go along with real estate investment. As someone else mentioned on the forum, Destiny Financial Solutions seem good, and Margaret Lomas is an investor herself. I think that makes a big difference. Depends on where you are though. Best of luck. AnnaYes it is logical that you would choose to be an owner-occupier as opposed to a renter, however it doesnt necessarily work that way in some rural cities. Wagga in particular has a very transient population due to the universities, defence bases etc. Albury also for the same reasons, plus there are big companies up here (eg Uncle Ben’s, Visyboard) which bring a lot of execs from Syd and Melbourne. That said, it is not uncommon to secure a tenant that will sign a 3 year lease, and be able to afford $300 p/wk + properties.
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