I’m new to the forum and am seeking some seasoned investors advice on my strategy.
A quick overview of my situation;
My wife and I currently run our own SMSF and are looking to purchase property as to diversify from the share market. We have about 120k in cash and my thoughts were to buy a small studio apartment outright as financing does not appear to be an option and then finance a 2 bedroom unit as well. Would this be a better option as opposed to buying a higher quality property e.g. 4 bedroom conventional house or not?
Hi Merlinn,
Great to see you here. As for your post, not quiet sure why you haven’t gotten good replies yet however it could be due to a lack of detail. To make suggestions there are a lot of grey areas. Firstly, what are you investing for? What are your goals? Why property?
Generally big picture questions, then later getting more specific.
Hi Merlinn,
Great to see you here. As for your post, not quiet sure why you haven’t gotten good replies yet however it could be due to a lack of detail. To make suggestions there are a lot of grey areas.
Thanks for the feedback Adrian
Firstly, what are you investing for?
Capital growth would be nice as I am not needing a positive cash flow at this stage in super (only 35)
What are your goals?
To diversify from the markets and long term own 6 to 10 properties for an income stream in my pension phase (maybe in 40 years pending legislation)
Why property?
It is the only gearing option inside super except for CFD’s which I am not a fan off.
Generally big picture questions, then later getting more specific.
This reply was modified 9 years, 11 months ago by merlinnn.
By purchasing a small unit I thought it would be possible to purchase 2 x properties instead of 1?
The SMSF has been setup for two years now under a corporate trustee, predominantly share trading.
Again I thought buy a studio outright and start deriving an income stream of which will also help support the purchase of a conventional 2 bedroom unit. My logic was to buy the studio out right as I would not be able to purchase it after financing a 2 bedroom unit. Being 35 I have a long investment horizon ahead of me.
Or should I just put the bulk of it into financing a normal 3 bedroom house in the burbs?
As you are still young it is best to try and finance in your Super as Terry say you can not refinance so best to purchase properties you can get finance that way you are leveraging and building your asset base using the banks money.
Although if you intend to do do act quickly before potential financial reform changes kick in and you are prohibited from doing so.
Must admit we are knocked off our feet at the moment on the rush of forum clients wanting to set up SMSF’s and have them source a property for them before the 2015 Budget.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
I have spoken to multiple people over the last few days all with various opinions, however one did seem to gel with me. A family friend mentioned I should ditch the unit idea and look for a normal house in the burbs, on a larger block with the option of carving it up later. A bit of digging around and I managed to find a 4 bedroom early 80’s style home on a 780sqm block with a small see view from the master bedroom. The zoning in the area allows blocks to be a minimum of 236sqm. Asking price 320k open to offers.
Can I please ask the members here for their opinions on this scenario?
Richard I was in contact with you just before you left the other day, hopefully you can work your magic on our application soon.