hey im 19 need some advice , im studying full time and iv had an investment house for one year its negativley geared it cost me 150,000 could probably sell it for 200,000 and had a 30,000 deposit its in a small country town and the rent is 180 a week would i be better of to sell it and use the profit for a more positively geared property or keep it and push through
So your property has risen 50K in one year….
You would be crazy to sell.
Your making almost 10K a year in rent correct?
and your probably paying the bank each year close to 15k (5K of that is yours)
You have a good investment, in 15 years you would of payed the house off through just rent alone.
Not to mention if you buy another house, and sell the one you have the stamp duty, tax, etc. Not worth your time or money.Shrimpo
hold onto it and look at the long term picture , what you are paying out of pocket could be considered as forced savings.
by the time you finish your studies you will be on the fast track and be way ahead of your peers, Plus be in a position with employment to approach the bank to draw down equity for buying your second and possibly third I.P. in a very short time…
Your investing time now in an education and will reap the rewards for the hard work and sacrafice. Imagine how much you have achieved over the last 14 years ..
same with your property… invest some time now of which you have plenty of at 19 years of age and in a few short years you can gain a lot more then if you take a quick profit now .
look at it this way you sell @ 200k take out your 30k deposit leaves you 170 k then remove the selling costs GST early repayment fee 's and repayment of your mortgage If you think about it clearly ,you will be left with a lot less then 50 K.The only way it would be right to sell would be to move the money into somewhere performing a lot better. Unless your crystal ball is high gloss this is tricky to determine. Generally regret is associated with looking back on cashing in a property unless it is for the next one.Entry and exit fees including capital gains tax, agents fees, advertising , stamp duty will all be lost from your equity. Small towns are probably best at present with rising prices and interest rates forcing people in bigger cities to examine their options. Any country town which has survived the drought will probably withstand the test of time. Consider whether a rent rise may be warranted and make sure you are getting all the benefits of tax deductions if you are working.
Good luck
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