My situation, Who is in the know?

Hi Benni

Welcome to the forum.  We hope you enjoy your time here.

Your serviceability for a loan looks reasonable but your $10K looks a bit low as a deposit.  All the excellent finance professionals on the forum may have a way around this for you.  One possibility is the help of family that may go guarantor for you?

With your serviceability and $10K deposit plus the FHOG you could probably get into a property that's being sold with vendor finance (VF).  The upside of this is you're "in" the market but the downside is you usually pay a premium price for a VF property.  If you'd like to research what's available with VF have a look at:
http://www.renttoownhome.com.au  and
http://www.vendorfinancedirectory.com.au

I have no interest in these sites, other than advertising there.  Good luck with your plan.

Cheers,  Paul

Hi,

Your strenght: ( from what i can see so far in your post)
1. good income

Weakness:( from what i can see so far in your post)
1. Low deposit

Not a lot of info…but we can work with that

My suggestion is to save up a decent deposit first- around $20-30k and buy in a good and known location where there is sure to be capital growth, it will be negative geared that’s for sure…so why buy a -ve place when you want a 6k passive income in 5 years time you ask???
Because; most +ve properties have low growth, and since your earning a good income of 120k you wont need +ve properties for now…what you need is a “foundation property” as your first IP + tax benefit from the -Ve.

So this is how it would roughly work out( By the way this is how i personally invested- living at home at that time etc)

Year 1
IP 1 – Buy good growth area ( established area), would most likely be -ve; claim the tax benefit + you can afford the lost because of your high income, you wont have this luxury when you move back town.

Year 2 ( will take you some time to save up again)
IP 2- If you have enough deposit- buy another good location property also -ve

Year 3 ( hopefully property 1 has gone up! -)
Draw on equity from Property 1 to fund this next investment– depending on your financial you may want to start going towards +ve properties now
IP 3 – Area with good +ve
Ip4- Area with Good +vE

Year 4-5
Buy what you can afford,
Sell Property 1 or 2 ( if it has gone up by 30% ~ 8% per year)

Of course this advice is general in nature But the whole point is to :
1. Understand the REASON behind each purchase
2. Timing – when to buy a +ve and a -ve to suit YOU GOAL
3. Have a exit strategy.
4. Lastly loan structure is important to achieve what you want…ie if you did a fix rate for say 4 -5year for IP 1 —- you would limit the way you can “draw on the equity” – so Build and find a good team of Professional that is willing to work for YOU.

Regards
Michael

Silly question: if your income is so good & low expenses, why only $10k savings?

Consider starting a smsf & put $25k each before end of june as well as your existing super. Watch that you don’t exceed your cap between employer & own salary sacrifice contributions. Not only will income in the smsf be taxed @ 15% compared to your current rate capital gains are lower as well. Get your super working for you. A couple of cf +ve properties will help.

Whilst you’ve got the income, you should still consider salary sacrifice as this is taxed at only 15% not your marginal rate.

Why lose an additional 30%+?

Michael,

On the basis that the only stupid question, is the unasked one, then "What are insurance bonds"???

Cheers

Swampy30

Hi Benni,

Mate where all here to help over the years these guys have all provided with so much information and i wouldn't be where i am without people from here.
So its good that your being humble and asking for advice. Mate im only 27 one lesson i have learn over the years is this.
Do you believe that your Motor Bike, Cars and etc are assets .To me these items are expenses because they don't make you money but in fact they cost you money. I would start by looking at how can i cut my expenses?