What are peoples opinions regarding having your owner/occupied home in a not so great location in order to have an investment property.
We bought a cheaper house in order to keep our original unit as an investment. I'm not sure if this is a good strategy or whether we should sell both and relocate to a better home and forego having the investment property.
Any advice/opinions appreciated.
Pretty tough question as there are conflicting goals involved.
On the one hand most people buy a home to live in with the major part of their decision making revolving around emotions and practicalities such as; nice area, good schools, room layout, number of rooms, size of backyard and so. You can insert your own reasons for choosing one home over another.
At the other end of the scale most people tend to choose an investment property on fundamentals such as likely growth rates, value adding potential, rental returns and so on.
Sure there can be some overlap of required characteristics depending upon your circumstances.
At the end of the day only you and your partner will know what is right for you.
A cheaper house doesn't necessarily mean a bad property. Remember the dwelling depreciates over time and the land appreciates. I don't think its an issue that you have purchased a 'cheaper house' so as long as the area and land component is solid.
Regards
Shahin
TheFinanceShop | Elite Property Finance
http://www.elitepropertyfinance.com
Email Me | Phone MeResidential and Commercial Brokerage
It's a personal question that only you can really answer.
If you've decided to forego a nicer PPOR in order to utilise more of your income on IPs then have you considered the option of renting rather than owning?
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'm hoping we can improve the house (which was renovated in the 70s) and thus increase its value. then hopefully we can sell it and relocate to a better area. to expedite that i was thinking of selling the investment property as well. wouldnt it cost less to maintain one property in a "good" area rather than two properties in lesser areas?
Hi Berkeley,
I would suggest you sit down with a pen and paper and do the maths. Get some quotes in and speak to real estate agents about what sort of price improvements you could reasonably achieve with the renovations. You'll probably find a lot of the renovations can be largely cosmetic and don't require a lot of money – just time on your part.
Once you have established possible sale prices (be conservative) then look at the costs associated with relocating.
Once you have analysed the financial side of things then undertake an analysis of the lifestyle benefits a change will make.
Once all of your information is in you'll be in a position to make a decision that suits you.
You must be logged in to reply to this topic. If you don't have an account, you can register here.
