Hi all,
I’m very new to this site and i hope that someone can help me. We built a house and moved in about 1 year ago. I now hate the area we are in due to several factors. I’m now faced with a dilemna : to sell or not to sell. Friends have advised to keep the property and make it an investment property. I’m worried that we do not have enough equity to buy as price of land has almost doubled since we bought in 2009. But someone also mentioned that this means our land would have almost doubled as well which means more equity. My home loan is ‘portable’ but not sure what that means. We want to build again but not sure what and how to do that. I’d appreciate any advice. ThanksAm very curious which part of Aus it is where the land value doubled in 2 years. But well done. Based on that it sounds like a good piece of asset to own and keep, as the rest of the country are not doing half as well!
Or did you mean overall land value in the country has doubled? Where did you get that information from?
Hi j900,
Well we have been trying to find a fairly cheap block of land and we bought ours for $140K for a 500square metres now they sell for $300K+. So i have asked the question if that meant that my block of land was worth the same and every answer I got was yes. I will get the bank and a real estate to assess my house and land and see what they come up with. We are in the Tarneit west of melbourne.
Yep Tarneit went mental. Why? Well a major contributor would be: new train line+station going in. Also it is close to the forthcoming Williams Landing train station. There has also been a massive price jump in Wyndhamvale due to a new train line+station going in. Just goes to show… it pays to follow the infrastructure.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Priz7780 wrote:Hi all, I'm very new to this site and i hope that someone can help me. We built a house and moved in about 1 year ago. I now hate the area we are in due to several factors. I'm now faced with a dilemna : to sell or not to sell. Friends have advised to keep the property and make it an investment property. I'm worried that we do not have enough equity to buy as price of land has almost doubled since we bought in 2009. But someone also mentioned that this means our land would have almost doubled as well which means more equity. My home loan is 'portable' but not sure what that means. We want to build again but not sure what and how to do that. I'd appreciate any advice. ThanksHi Priz
Welcome to the forum.
If you suspect that your property has increased in value, you may be able to tap into some of this new found equity and use it as a deposit towards your next purchase.
Basically, depending on which lender you are currently with, you may be able to "top-up" your current loan to 90% of the properties value (which will incur some mortgage insurance). You could then use that "top-up" portion as a deposit and purchasing costs (stamp duty, legals, etc) on your next purchase.
If you're seriously considering turning your current property into an investment you should (if you haven't already) convert that loan to interest only and set up an offset account. You can then place the equivalent of the principle portion of your repayments (and any extra cash you may want to save) into your offset account. When it turns into an IP you can withdraw this money and use it towards your next property (your new principle place of residency). This effectively increases your tax effective debt whilst reducing your non-tax effective debt.
Hope that helps
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Hi Jamie,
Thank you for your advice. Everything makes more sense now. Will be in touch with my lender to see what they say. Would you recommend having both loans with the same lender or does it really depend on what we are after?Thank heaps everyone
Hi Priz
Hard one to answer as it all depends on who you are currently with and what are your current requirements.
In most cases we find that we are able to not only save the client money with a more competitive loan product but also by splitting the loan between separate lenders find that the loan can be structured correctly.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Priz,
I also live in Tarneit and am in the similar situation as you. I bought the property in Dec 2008 for $300k and got bank valuation in June 2010 for $420k. About 40% in 1.5 years, not bad at all
. I thought properties in Tarneit would not perform this well. And yes, JacM is right about regional rail link project which will have tarneit station just north to leakes rd near derrimut rd intersection. Also, new williams landing station (shifting aircraft station as far as I know, not additional station) and williams landing development itself. Other future project to mention is the Westlink tunnel which will give alternative access from west to city.These were some of the reasons I decided to switch it into IP. Exactly like Jamie said, we refinanced, switched to interest only with 100% offset and used the 'excess' money to fund deposit and buying costs of another property (due to settle early next month). However, the 'excess' money won't be tax deductible since it is used towards new PPoR. Correct me if I'm wrong or any suggestion on how we should structure the loan efficiently. Priz, I hope you don't mind if I'm asking questions here since I believe that the suggestions/info provided by the experts here will help.
All the best.Cheers,
RyanHi all,
I'm glad I found this website
This is helping me a lot. Ryan I do not mind at all. So basically what you are all saying is that I can switch my loan to an interest only loan even though I will still be living there for a while until we find the right place and by the time that settles and we build etc…?Cheers
PriPriz7780 wrote:Hi all,I'm glad I found this website
This is helping me a lot. Ryan I do not mind at all. So basically what you are all saying is that I can switch my loan to an interest only loan even though I will still be living there for a while until we find the right place and by the time that settles and we build etc…?Cheers
PriYes. If this property is going to become an investment property in the future then it would be ideal to convert this loan to interest only now. Set up an offset account against the loan (if the lender allows) and deposit any savings in there. When you're ready to purchase your next PPOR, you can withdraw the money from your offset and use it towards your new PPOR purchase.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
. I thought properties in Tarneit would not perform this well. And yes, JacM is right about regional rail link project which will have tarneit station just north to leakes rd near derrimut rd intersection. Also, new williams landing station (shifting aircraft station as far as I know, not additional station) and williams landing development itself. Other future project to mention is the 
This is helping me a lot. Ryan I do not mind at all. So basically what you are all saying is that I can switch my loan to an interest only loan even though I will still be living there for a while until we find the right place and by the time that settles and we build etc…?You must be logged in to reply to this topic. If you don't have an account, you can register here.
