Hi All,
I am new to this site and from what I have read so far, it seems great.
I am 27 years old, single and am learning about property investment. I see a lot of people my age falling into the trap of committing to 500-700K mortgages, I am not interested in doing this. I want to purchase my first property in a growth area for around the 250-300 mark. I am confident with the research that I am performing that I can identify a potential growth area. I am to rent it out after the first 6 months so I still get the 1st home buyers grant. I am not too far away from a 50K deposit.
My question is, what is the quickest way to acquire the 2nd and 3rd property?
Is it a better option to source positive or negative geared investments?
If I have a property that is close to cash positive, will the bank be happy to lend me another 250K to do it again.Any advice would be very much appreciated.
Cheers.
I can't advise you on all the aspects of your question, but personally would not invest in anything that was neg geared. I could not afford to support ANY properties at a loss, but could happily have many properties which paid me cash (rental) every month, year in, year out.
Some people could possibly support 1 property at a loss, hoping for capital gains (but takes years).
Most people should invest in property that gives a positive cash flow from day one (IMO).Also, you should think about overseas (USA) deals. Their market has fallen through the floor. For your same 300K you get 3-4 houses, all paying rent and therefore positive cash flow. Returns seem to be somewhere between 15-23%, depending on location.
Just my personal opinion I'm sure others will step in with more advice.
Hi ?
You might like to consider structuring your next IP so it generates positive cash flow and fixed capital gain, i.e. buy your next property and on sell it with a vendor financed Instalment Contract.
We have been doing this for quite some time and find it to be a good tool to increase the speed of our portfolio building. It is often possible to structure it so that one of these +cf and fixed capital gain properties, supports another similar buy & hold.
Cheers, Paul
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
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