OK i have narrowed down my prefered investment options that should cover the next say 3 to 5 years.
WHAT WOULD YOU DO ???
First details
ME $92,000 salary Very stable job for many years yet.
Wife $33,000 wage with a job for life
No debt appart from PPOR( POSSIBLE CHILD IN THREE YEARS BUT WIFE WANTS TO GO BACK TO WORK AFTER)PPOR Worth $345,000. Will owe$70,000 with $140,000 available funds ready for use if needed.Repayment $350 pw
IP Worth $310,000 owe $310,000
Holding costs $26,000
Rent $13,500
Tax refund $10,095 including normal pre IP purchase return
Out of pocket cost $2,680 or $50 pwoption 1Keep paying of PPOR and look at buying another IP in a year or so depending on the market or
Option 2
Buy house in christies beach SA $270,000 great location, $240 pw rent
After calculations out of pocket cost is about $160 pw including tax return
My thoughts are
OPtion 1 Safer with possible turbulant days ahead in real estate
Pay house of freeing up $350 pw to consider investing again in a year or so.
A kid will reduce us to single wage for a period but should still be ok.
Two neg geared properties a bit scaryOption 2 Adelaide looks set to rise even with rocky property market.
Can still comfortably take on the debt( Our current take home income is$2,000 pw including tax refundfrom IP )
Adelaide shows better promise than current IP.
Dont want to kick my self in years to come if i dont jump when i should.Not sure. Im going to see a finnancial planner to get some advice but im open to suggestions.
Fogot to add that i also considered a couple of other things
1# Buy a more regional IP for a lower price.
2# Throw $20,000 on somthing risky on the share market( dont mind a bit of a gamble)
3# Go to the casino ( Im joking)The average FP will recommend a nice range of Managed Funds or Property Trusts depending on the commission they receive and is unlikely to recommend property investment.
He / she is unlikely to have any idea of how to correctly structure your loan for furture investment. I see you appear to have currently X collateralised your 2 properties currently and this may hinder your progress as you move forward.
Why not email a local mortgage broker with investment experience and get their advice.
Someone like Alistair (A Perry) from the forum here who is is based in Melbourne and is not that far away from you given the technology we have these days.
Richard Taylor | Australia's leading private lender
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