Hi Guys
Have I made a mistake as an investor?A 3 bdr brick house was purchased for 205K two years ago, yieling 195/w rents. It was my first property purchase. Negative gearing has helped a little though.
This house has loads of appeal with its water view, achitect built in 1996 and other features like separate dinning, extra study room and gorgeous kitchen etc… Drawback is 40 min driving distance from Hobart and no council water provided(tenants buy water by tons regularly)…Good condition but poor location, I must admit.
RE told me I would not sell it for more than what I paid, if I tried to sell it now.I am about to move to TAS with a new job on 63K.
To my enquiry, bank told me they could lend me another 100K, if I applied for a second loan, with the new job and 40K savings I have.Shall I sell the above property and buy a OK one (about 250K-300K) in a reasonably close to city and live-able suburb, to live in
OR
keep the above investment property for a long term investement, and buy a VERY CHEAP weatherboard or ex government housing type closer to the city for less, to live in?
I need a house to live in soon…What would be best for my financial future?
Any experts out there?
If it were me, I think I would keep your existing property.
You are going to lose money if you sell (according to the agent) by the time you take commision and advertising etc. But bear in mind, that’s only the CURRENT market. In the long term, even in Tasmania I am confident you will see a significant rise in value. If you can afford to, hold it and buy something cheaper to live in.
The fact that it hasn’t increased significantly in the past 2 years is not necessarily bad, Tasmania hasn’t boomed like the rest of Australia, and may never, but it will still go up in value. I think you should expect reasonable growth in the long term. You may not have made a great decision to buy where you did, but there’s no point just selling to lose further, when you might be able to turn it around in the future.
We had an ugly duckling in a 2-bit town in the middle of nowhere and it sat unrented and unsold for years, we literally couldn’t give it away. And then gradually, after years, the market has slowly slowly risen and now it’s worth double and rents easily and is very easily saleable – and it was a DOG!
cheers
Hi Kayee,
First of all I would like you and Solo to look at this link and see what has happened to the TAS property market. If the rise in prices from 2000 to 2005 is not considered a boom then I don’t know what is-
http://www.independentvaluers.com.au/content.asp?pid=1742I suggest you do some number crunching yourelf or go to an accountant specialising in property investment to work out what to do because 40 mins drive from Hobart is a long way in Tasmanian terms and it may take a long time before properties that far away from Hobart get town services or rise in value.
It would be worth getting on to the local council to find out what they have planned in terms of development, transport links, improvement of town services etc.
I travelled around TAS and researched the property market just recently so if you tell me where your property is I will give you my opinion on the area.
I hope this helps.
I hope this helps.
Todd Burns
http://www.freepropertyhelp.com.au
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