Hi everyone!
I would appreciate any information about the folowing:
I own my own very small business that has only been in operation for the past 2 years. I rent and have no deposit for a home and yes I am a wannabe property invester. Due to the fact that I don't have a deposit and it is not possible to get a self certified loan with no deposit I have been looking for other ways to enter the market.
My cousin would also like to buy a home and it is easy for him to get a loan and is interested in purchasing somthing together and share the property and the loan. I am thinking that if we purchased a home that he would have to get a loan for we could then go halfs in the repayments.
I was thinking we could purchase a large two storey and devide it so in the end we would have a small flat each.
I am just not sure how the finacial side of it would be arranged and how I could part owner when the loan is under his name either before of after we apply to devide the home into two.I would also appreciate someone telling me where I can learn about this issue because everything I read sugguests this type of thing but gives no details.
Thank you!!!!!!!!
KatriHi Katri,
What part of Australia you in? Country or City will have varied prices and effect how much you might be able to loan.Will it be your first home therefor you could use the grant of up to 17k as the deposit if (in Victoria) starting with a simple place in a country town with a 100k or so purchase price.
I am in Melbourne. I was thinking of buying in Reservoir where we live. A large two storey home with 5 bedrooms just sold for $400.000.00 up the road frfom me. I am aware that I might be able to buy somthing cheap in the country with my first home buyers as a deposit.
but don't I have to live there for 1 year to do that? My business is in Melbourne.
No you are only required by law to reside at the property for 6 months.
Note: Beginning at any point within 12 months of purchasing.
So you can rent it for 364 days and move in for the 6 months starting from the 365th day. It's the old rule that most people keep referencing to when it was 12 months living at the property. That has long changed!
Depending how creative you are there is other solutions as well, such as owner builder and claim the full 29k for building new on a cheapish block out bush as you city folk refer to it as (Country town). Don't have to be owner builder to get the 29k FHOG in Vic either.
Also you can rent a room or two while living in the property to generate income to service the mortgage debt. Other creative ways such as vendor finance may be harder to find but getting the seller to fund 20% and you borrow 80% and or a delayed time until you pay the 20% back to the vendor.
An example of this would be if a property was 100k you talk with the vendor to pay them 20k starting in five years time or less, more even. The vendor gets 80k cash now.
Maybe you might find a lease to buy option where you don't need a bank loan.
Hi, one of the problems is that you don't have cash upfront. It's important because without a cash injection, the commitment isn't there.
A sensible thing to do is to get an existing property in your cousin's name & sub-divide it and the other portion in your name.
I saw one property for sale in Braybrook DA already done. Your cousin can buy this & then sell you the new devt then both of you can get the FHG
The only problem I saw is that the asking price is rather high – $360000
From what I saw of the plans [2 storey townhouse] it'd cost $238000 to complete. Not a lot of cap gain in that plus holding costs & risks of property mkt collapsing. That's why more mature investors aren't very interested.
This kind of deal might suit you and your cousin but you have to do your own arrangements.
You might also get a discount [depends on circumstances] off the asking price. Don't forget the seller needs to make a profit too. He's put in a heap of work and money into the DA. At a time when interest rates were very high.
I'm interstate & I'm looking at Melbourne & Sydney, something that I didn't do in 15 years.
If you do decide try to PAY something then you can register a % of ownership. Upfront cash is expensive but as newbie, you have little choice. See, it commits you to regular repayments. Banks won't allow you to default. $15000 shouldn't be too difficult to raise. It is paying it back that's tougher. If you can't raise that amount, it'd be wiser to wait.
Good luck,
KYThanks so much for the advice gyes. I have some thinking to do..
You must be logged in to reply to this topic. If you don't have an account, you can register here.
