Hi,
Am from the northern beaches. Bought an investment property in Umina Heights a while ago. Away from the “flats” -lovely big block with bushland and ocean views (similar to the feel of Bilgola Plateau). Flipside of Pittwater – only a 20 minute ferry ride back to the northern beaches; an hour and ten on train to Sydney.
Tenant moved out of our property in Umina so we moved in leaving behind our rental apartment in Avalon.
Have a spare 150k. With today’s uncertainty with the GFC and HUGE real estate prices in the northern beaches, we have decided to give our propery in Umina a go.
Still uncertain about the area. Stunning place but the coucil and some of the locals are NOT so (NOTE: I said “some”)
Do we invest the $100k (leaving 50k reserve) in the property, make it really nice , count on capital gain or do what is necessary so we can re-rent (part of the reserve) and look to invest $100k else where? Not much that $100k can do considering we like northern beaches.
I know replies will be dependant upon what our goals are but we are flexible. We are prepared to live here and invest to if potential is to be made….or vice versa.
All opinions greatly appreciated. Thank you.
Hi QM,
I would personally use the $100k to invest in a different area that has a better chance of getting good capital gains in the short term.
The northern beaches may be a great area to live, but it is expensive. Having two properties in the same region also increases your risk because if prices stagnate or go down in that area then you are going nowhere fast.
You may also be eligible to pay land tax if you have a combined land value in one state exceeding a certain threshold. You would want to avoid this where possible because it is just a blatant money grab out of your pocket (much like stamp duty).
$100k could get you a $500k investment property (at 80% LVR, avoiding mortgage insurance). If you can find such a property that provides a good rental return, it may cost you nothing to hold the property.
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