Hello everybody. I’m completely new to this very informative online community and to the world of investments and the like. I’ve been more and more interested within this investing realm and thus I’ve got a few questions…
Background:
I’m currently 20 years old (21 in about a month and hence the contemplation of what I will do with my life from here on…) and currently I’m in my third year in architecture (2 more years if I want my masters) and prior to that I graduated from a 2 year course of Diploma of Building Design and Technology. So I’ve got quite a bit of knowledge when it comes to design and construction (also working in a studio)…
I was contemplating on some options or I guess “ideas” regarding plans on how I can move forward. I was actually thinking of buying studio apartments in Melbourne (I live in the suburbs but go uni there) and renting them out. Any experienced Melbourne investors out there willing to give advice/guidance? I thought studio apartments would be an easier start compared to houses in the suburbs. What kind of returns could I expect? It seems like the target market are young professionals and university students – both local and international.
Currently, I’m playing around with the idea of finishing architecture after my third year and getting my bachelor’s degree instead of a master’s degree. And perhaps doing a diploma/bachelor in business and be a jack of all trades… Then go crazy towards my goal of the studio apartments strategy…??? Bearing in mind that I am also thinking of residing deep within the city so I can manage these studio apartments…
I don’t know, it was just a thought… Maybe I’m being naïve???
Any suggestions, advice, direction, critics, whatever will be greatly appreciated.
Cheershi p_mac,
Welcome to the forum.
Studio apartments generally have lower capital growth and depending on the area of the apartment, the loan to valuation ration might be low as well. Its probably better to have a 2 bedroom apartement shared by 2 (maybe 3) students. I think you will find the return is better.Hi p_mac, I agree with property power. Studio apartment offer very little leverage. As an architect (or soon to be) I am thinking that maybe you could buy a big 5+ bedroom house, do a minor reno and rent by the room. You can continue to add value by including FREE internet, laundry, etc, etc, etc. To use those skills learned in school, the time has come…
Happy Investing
Hi p_mac.
I don't think it really matters what you're strategy is at this point, unless you already have a war chest to invest.
Whatever strategy you come up with now will probably have changed within a few short years. My 2 recommendations for you at this point in your life are:
1) Make sure you do something i.e. make sure you actually start on some kind of plan right now.
2) Make sure that you don't do something fatally stupid. This would be quite hard to do investment-wise at the age of 20 (after all, how much have you got to lose really?). Don't fear making a small mistakes, that's how you learn. So back to point (1).Time in on your side p_mac, just make sure you actually get some plan under way now, be prepared to learn as you go, and you will do well.
I recommend that you buy this book: http://www.amazon.com/Slight-Edge-Jeff-Olson/dp/0967285550/ref=pd_bbs_sr_1?ie=UTF8&s=books&qid=1196714897&sr=1-1
All the best,
Daedalus
Thank you heaps! I will definitely take into account what everyone has said. Its been very informative.
Daedalus, how do I go about "starting" now? Talking to a financial advisor? Can you elaborate more or should I go buy the book now?
Cheers
Hi p_mac,
You should definitely buy the book now.
WRT starting. Your first investment will be determined by:
1) Your level of income (assuming you need to borrow)
2) What funds you have to invest
3) Your level of knowledge.Maybe the starting point is to ensure you have adequate capacity in those 3 areas? Maybe the starting point is to refine your strategy down to exactly what you will do in the next 3 months to progress yourself along your strategy.
Note that this might not actually require buying property in that timeframe – the first year of my plan involved research and reorganising income and finances so that I could begin to execute my plan.
Daedalus
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