Hi Guys,
I'm looking for a bit of guidance. Im currently living in mt isa for almost 2 years now. Working at the mines as an engineer and paying around 450 p/w in rent with my gf. We both have good jobs, making good money and quite secure but really would like to move into our own place. I have pre approval and have been looking at properties for last few months between 300-380k. The market seems very uneven, some houses seem terrible and overvalued and others undervalued and half decent.We are at the point where we want to get our own place and work on it on weekends and just learn a few trades and I guess get a sense of accomplishment from it. I've been finding it really hard to get solid research on places in mount isa and very hard to foresee where the town is going to be in 5 years in terms of prices. Ive read a few articles by terry ryder and the most recent one being
http://www.heraldsun.com.au/news/national/want-to-make-money-dont-go-there/story-e6frf7l6-1111116195528Now this scares me quite a bit. I dont feel some of the issues he talks about are really that bad and I grew up here and moved away. I guess my main concern is buying a place for to much, seeing the market fall and having my first step into the property market taking 2 steps backwards. Inevitably we would want to move in a few years but also wanted something we could live in and call our own….plus the rent is almost equivalent to a mortgage. In the same token its hard to tell if prices are actually half fair and in 5 years maybe they will be quite higher, but I guess this is part and parcel of the investment game.
The point of the thread is to get some advice from investors and people out there that may have been in the same position as me at one point or another. In one hand I want to have a nice house to come home to and relax in and in the other hand I want it to be the step in right direction. Should I just hold my guns and live with the rental for the next few years and try by an investment property elsewhere that I can be safe with, or do I just need to get over my fear of the market falling and bite the bullet? I know i am the only one to decide this but would love some opinions and guidance to maybe see it in a different light?
Thanks very much
so no one has any investments in ISA or everyones pulled them out already?
Since no one has replied I will give it a go. Although I can't really add much.
Really there is no point in buying property unless it will increase in value. Even if the rent is the same as a mortgage would be you will have added costs such as rates, repairs, insurances etc plus stamp duty and buying costs to get in. There will also be an opportunity cost as your funds will be tied up and you won't be able to invest them elsewhere.
So a large part of it comes down to estimating any future capital gains. Having grown up there and working in the mines you may have a better idea that an outsider.
Maybe some questions to ask are:
Do you think the mines will keep operating?
How many different types of mines are there – if one commodity dives will the others maintain the town?
How are rents going? increasing rents may increase prices
Whats the vacancy rates up there.
etcTerryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Terry, thanks for your replly.
I have been carefully weighing all the options up and after putting some figures down on paper it becomes a bit clearer that buying here is probably not the best place to start…quite risky and probably not the best way to enter and get my feet wet. Looking at just increasing my deposit and buying an IP first. What deposit is generally required for an IP. If i purchase one can I still use my FHOG after if its not my PPOR first?Thanks,
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