Advice to go the next step?

Further to what Terry said, it will also come down to what you can get finance for. Financing development projects can be a bit trickier, particularly if your partner isn’t working and given that you cannot demonstrate experience in turning a profit in this field to the lender.

If you go down the renovation path, remember that you only pay capital gains tax on 50% of the “gain” if you hold the property for at least a year. This could help make it easier for you to find reno projects that will turn a profit that doesn’t all get chewed up in taxes.

In that situation my pick would be for a renovator in a growing area on a block that has dev potential. You can buy, reno, rent, then spend the next 12 months attempting the development. While you are doing that its growing with the market. CG is easier money than straight reno flipping in my view. You can certainly try fipping as a volume business but its pretty time consuming. With a reno/dev project you get to add value both ways and your deal volume is smaller so your time invested is less overall. I would allow around 18 months to get it all done. If you want to keep or sell at the end its up to you, also whether to sell raw land or go all the way and build the new dwelling. More profit if you do built (in most cases) but this is also where a lot of the effort is. With the Sydney ripple moving outwards there are some great markets you could get into that are affordable and have plenty of potential. IF you hold for more than a year you should also be elligible for capital gains tax 50% reduction which will reduce your costs when selling. (if you start doing it regularly as a business then I think the ATO will have concerns with this but in my experience doing it once or twice is ok)

The tricky parts to get this right:
1 – Choosing the right area
2 – Choosing the right zoned land
3 – Choosing the right block slope/shape
4 – Choosing the right house to reno
5 – Being disciplined enough to see it through
6 – Not getting pregnant right now even though thats probably what you want

But its all possible. If you have a few years you might be able to pull this off a couple of times and have either lots of property, or sell some and and have less property but with plenty of equity and some cash in the bank before you have kids. MY wife and I did basically this with some buy, reno, hold, and some buy, reno, sell, and 1 buy, reno, develop, sell before we had kids. Property profits paid for 9 yrs of her not working and gave us the deposit to buy the land we then built our PPOR on. Its great planning ahead if you can, most don’t.

Oh I am so jealous of your position!!! Although I built my first home at 18yo, I didn’t find the teachers or methods to show me how to go ahead and make the money I could have made. In my defence there wasn’t really the internet like there is now. But I came back to start back into Real Estate after having children and using up our funds. Tough position. If I could do then what I started doing later, my whole life would have been different. Will love to hear what you end up doing! If it were me, I’d re develop my block as you were mentioning, just to start.