We've decided to dump the emotional attachment and rent out our PPOR – essentially making it our first IP – and renting in an area we really can't afford to buy in. We also intend to buy another IP in the very near future. Our PPOR is currently valued at around $600,000 with a debt of $400,00, so I hope to use this equity to purchase a 2nd IP of around $300,000 in Adelaide also.
I have a few questions though that I hope people can help with – the first one is how to structure the finance (and with which bank)? We have a fixed loan on the PPOR currently with CBA. Is a line of credit worth looking at for just two IP's?Also wondering if anyone here has recs for a good accountant in Adelaide – our current one has NO idea about property investing from our initial questions! Good mortage broker recs would also be fantastic.
This is not answering your question, but when you mentioned Adelaide I recalled reading a news article today about the Mitibushi plant and the its future. 18 months ago I was looking a IP's around the Marion area but stayed away due to the rumours of the plant closing. Every 12 months there seems to be a news report about the plants future, one day it will close down. Therefore, if you looking in the south of Adelaide, factor the plants future in your duedilgence.good luckGeoffBHi Santorini
Congratulations on the decision.
A Loc could be the way to go to raise your deposit and cover the acquisition costs however a few more questions would need to be answered first prior to making any form of recommendation.
If you want to shoot us an email i would be happy to give you some advice.
Richard Taylor | Australia's leading private lender
GeoffBeck wrote:This is not answering your question, but when you mentioned Adelaide I recalled reading a news article today about the Mitibushi plant and the its future. 18 months ago I was looking a IP's around the Marion area but stayed away due to the rumours of the plant closing. Every 12 months there seems to be a news report about the plants future, one day it will close down. Therefore, if you looking in the south of Adelaide, factor the plants future in your duedilgence.good luckGeoffBGeoff,
Whenever Mitsubishi want more govt money they threaten to close down the plant. The govt can't afford the bad press with headlines of "plant closing – loss of hundreds of jobs" plus the added ripple effect on other business who supply them with parts, so they give them more grant money to keep the doors open. This tactic by Mitsubishi has been going on for many years, …… and I'm sure it will continue under Labor / Rudd government.
I have a couple of IP's near the Holden plant in Elizabeth. Last year they announced that they would be laying off 600 jobs. It didn't affect property sales or rental market in the area.
If the plant did close it would probably have a negative affect on the immediate area, but Adelaide is growing and you would imagine that it would be able to absorb the closure.
Martin
Hi Martin,
Totally agree/repect your comments. My decission was based on risk assessment whether it was right or wrong.
I don't want to discussion the issue regarding the Mitsubishi plant issue in this post as it would be hijacking the initial post.GeoffB
GeoffBeck wrote:Hi Martin,
Totally agree/repect your comments. My decission was based on risk assessment whether it was right or wrong.
I don't want to discussion the issue regarding the Mitsubishi plant issue in this post as it would be hijacking the initial post.GeoffB
Yep, … point taken.
Martin
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