My first plan of acquisition

Hi

I have been a member of this forum for about 6 months and been doing lots of reading on and off the line trying to establish a strategy of acquiring property and making money from property.

I have never purchased property in my name before and would like to take advantage of FHOG plus the stamp duty exemption for NSW purchasers. The reason why I have decided to buy PPOR and live in it for 6 months instead of buying IP first is because:

1. to take advantage of government scheme; esp stamp duty exemption;

2. I don’t feel I have enough confidence buying property without seeing and right now I feel it’s more important to spend more time improving my career prospect so that I can increase my serviceability.

3. Let my money work since I have deposit which is sitting in an internet account earning 5.7%, which is probably being eaten up by tax and inflation.

Since I would have to live in the property for 6 months my first property purchase is going to happen in Sydney. Then I would rent it out and refinance or sell before the 6 years is up to avoid paying capital gains tax.

Because I am a beginner and have never renovated or subdivided before, I thought the best strategy for me is to acquire the property and get into renovating and subdividing later on when I have more knowledge about council, building materials, renovating etc….

In the mean time while I research research for potential principal place of residence as well as concentrate on my career I pay back my loan as fast as I can, with a little help from my parents.

Do you think my strategy for first couple years is OK or do you think I should forgo the stamp duty exemption and jump into IP for cash flow? If there is an opportunity of making more than the stamp duty exemption in the first year I guess this would be the way to go, but otherwise I don’t think it is wise to give up stamp duty exemption because I am on such low income.

Do you think I am rushing too much? What I am currently doing is an area search in Sydney, with infrastructures that would attract potential tenants and past history of capital gains. I am also calling agents, and going to open houses to check the location of properties.

I have also seen a mortgage broker re finance, and know how much I can borrow, even though when it comes to borrowing the actual amount it may be another question. [thumbsdownanim