Hi,
I am at the stage where I want to start investing in property and I am totally at odds where to start. There seems to be so much advice out there and everyone has their own opinion, it is overwhelming to be honest and hard to know who to trust. I am from overseas and don't really have any friends who have invested out here. I own a property in Sydney already, but am now looking to expand into an investment property using the equity.I don't think wraps or vendor finance really suit me to be honest, so I think an equity line of credit and capital gains is the way I will go. But the hardest thing is where to invest? I went to the property expo in Sydney recently and it ranged from North QLD, to SE Qld, to Sydney to Melbourne to Adelaide etc. as to where to invest…everyone had an opinion. Like I said I don't know any people out here who have really invested so I can't go to them for advice.
Can anyone give some ideas as to the steps they took before they took the plunge in investing? I am thinking I would like to stick to Sydney because I think it is on the verge of a boom in the next year or so as it is the only city that has not in the last few years and it is due for some catch up, but where in Sydney is the thing? I know eastern suburbs, nothern beaches etc are good value and maybe I should stick to what I know. But I don't want to miss out on a different suburb giving me excellent returns just because I wasn't in the know. I read about Chippendale and Whale Beach etc being excellent prospects, again opinions, opinions, opinions from so called experts.
Maybe I should go with a buyers agent?
Any advice would be greatly appreciated.
Thanks
Hi Shay,
welcome to the adventure. My advice would be to " be informed ". Read as much as you can and scour this forum for ideas/strategies that resonate with you.
I would be looking in your own back yard first and depending on your budget look at buying with as much land content as possible, preferably not on the fringes. I'm in Melbourne and bought in Parramatta nearly 18 months ago. Haven't had a great deal of growth as yet, but the yield is around 6.2 % which I consider very sound for middle Sydney. Don't rush and keep asking questions to narrow down your choice of asset (unit, town house, house on land, etc) and also narrow down to two or three suburbs. You then need to become an expert on these areas and the values of property there.
Oops, I've just re-read your post and notice you're from overseas. Well most of what I've said above still holds true.
Where are you living at present and are you likely to remain there? Are there any reasons that you cannot invest there?
Hi Michael,
Thanks for the advice. I am in the eastern suburbs in Sydney and there is no reason I can't invest here again. But I guess diversification is on my mind. Also while this area may give me good growth, there may be other areas which are cheaper that would allow greater capital growth and would allow me to buy more than one unit. For example, I bought in 2004 and while I have had around 20% growth which is good, if I had bought in Perth my growth would have been a lot better. Hence my dilemma, trying to find the next growth area and who to believe. A lot of people seem to think SE Qld, Townsville etc..If you are living in Melbourne, how did you source your property in Paramatta and why there? That is west Sydney and one of the areas in a lot of strife the last few years in Sydney.
Cheers
Hi Shay,
I went interstate to lessen/optimise personal land tax liability. In Vic, I have some IP's in my own name and some in our Super fund. I also own an IP on the Gold Coast.
I was looking to diversify the type of property I had (mainly houses on decent land and one commercial) to apartments. My aim was to buy a "six pack" and ended up with a " four pack " in Parramatta. The yield is outstanding and with the property renovated and with still building write off remaining, the numbers were good.
Parramatta is the gateway to Sydney's west (the further/deeper west is in the most strife) and has excellent amenity with affordable rents and affordable property. There will always be a customer for your property there. I could go on and on…….I notice that you've also posted this question on another forum. Do a search there for Parramatta under where to invest and take heed of any posts to your thread.
I still would learn more and don't rush. My info is sourced from websites, attending expo's like you, Australian Property Investor Magazine, reading, networking and my favourite tool…..Google Earth.
Investment property is also a great investment because of the way that it appreciates in value. There is no other field other than real estate that can appreciate so quickly. You will not have to worry about losing on this type of investment and, no doubt, in just a short time you will be able to see how much your property has appreciated. If you are willing to hold on to the investment property for a while, you will really see great appreciation and be able to enjoy the benefits associated with it.
Hi Shaye! First of all, have you read any of Steve's books. They are a great way to help you narrow down what you are looking for and why. Don't be afraid of regional areas, though do your research first and find out whether there are growth prospects for the town you are considering such as new industries, mines, infrastructure. Ask yourself why are people going to come to this area and set about to find out. Look at Council websites, talk to Real Estate agents etc. You may find an area with close to positive cash flow with great capital growth potential. Realestate.com is a great way to start your search.
It is hard when you first start out but spend the time to research and you'll find you can buy with confidence. As the other have said, take your time and don't rush.
Hope this helps and good luck
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