Hi property experts!
Wanting to invest in Sydney – currently I have around $65,000 deposit so only have a 20% deposit for something around $325,000 so looking in Sydney’s west for a 2 bedroom unit…any suggestions of areas with good growth + good rent? Have also considered going for a larger loan amount but have been told by a broker that my LMI could be around $20,000.
Thanks all :)
Hi property experts!
Wanting to invest in Sydney – currently I have around $65,000 deposit so only have a 20% deposit for something around $325,000 so looking in Sydney’s west for a 2 bedroom unit…any suggestions of areas with good growth + good rent? Have also considered going for a larger loan amount but have been told by a broker that my LMI could be around $20,000.
Thanks all :)
Liana, the time to invest in Sydney has passed. We stopped buying there 3 years ago and those clients have had three very good to great years of capital growth so far. If you get in now you COULD see 5-7 years of flat growth or even negative which happened post the 2003 and the 1992 market tops in Sydney. Property markets go up in cycles, then they sit flat for a period.
The market that is about to boom is Brisbane and more so to the north of the Brisbane CBD where there is a new train line and a ton of population growth.
Good luck and happy investing. If I can be of help let me know, my details are below
Modernity Investing
Email MeWent to a number of opens in GWS over the weekend – I think Mark is on the money, the time is passing. The feeding frenzy from the recent boom may leave you with a potential correction (I’ve noticed a trend of some Sydney investors divesting at the current sellers market and reinvesting elsewhere). Brisbane and Adelaide are consistently coming up as investor hotspots as of late.
On the LVR front, balancing the LVR and LMI requirements you should be able to hit circa 90% and keep well away from extortionate LMI premiums. If you were to bump up your purchase price to $450,000 you would have a 90% LVR and LMI of ~$8000, which could be capitalised onto the loan.
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This reply was modified 9 years, 9 months ago by
Corey Batt.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
Agreed, the lower end of Sydney has done its thing for the moment. Houses that were selling in Ruse for 300k 2 years ago are now bringing 440k. Same with Mt Druitt. Houses selling there 2 years ago for 210k now bring 340k. You should invest further afield. Some regional centres are experiencing growth now, areas on the north coast and north western areas for example and some places in Brisbane.
Liana not sure what your Broker is on but send some my way.
LMI on a 88% loan to valuation with a loan amount between 300-600K would only be 1.3% of the loan amount so even on a loan of 500K would be $6500 which could be capitalised (And of course is tax deductible) so a little different to 20K.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Liana
for 320k .. you probably looking at Marchathur/camden area for a very old 2 bedder.. rent out around 290 to 300 pw. you probably will need to offer on the 1st day of it’s open and be lucky if the vendor will lock in with your offer.
you can still get into the market with that sort of money in sydney, but the cashflow is bad.. my view is if it’s for long term.. you wont go wrong with the entry level of IPs in a major city, but you are probably overpaying in sydney at the moment.
I think other captical cities offer better buying opportunity currently.
Liana..
the LMI is way high.. check out the genworth calculator..http://www.genworth.com.au/online-tools-forms-and-reports/lmi-tools/lmi-premium-estimator
Liana..
the LMI is way high.. check out the genworth calculator..http://www.genworth.com.au/online-tools-forms-and-reports/lmi-tools/lmi-premium-estimator
Liana . with your budget I would perhaps consider the central coast NSW. You are 40 to 90 mins drive to Sydney. The market is very diverse so you will have to do a lot of home work on locations. Some areas have peaked while others are in the mid part of an upswing. There is a lot of potential. There is still a tone of property available where you can manufacture equity after you buy. If you are a passive investor who just wants completed stock and sit back and pray for growth it may not be that great. If that is what you what to do I would spend a few hundred dollars on hotspotting reports over at Terrys sites and research some areas then go and buy a median priced property with high depreciation benefits. If you want something you can sink your teeth into and actually invest/create something then I think the Central Coast is the way to go. Yields: A property for 320 will probably rent for around 320 to 400 per week. Having said that I hate to generalise. Even in Sydney there will be areas that will continue to grow solidly for the next 5 years and to talk about one “Sydney” market is false as there is no such thing in reality. There are plenty of people who still hate on the central coast and I am biased because I live there so you have to take both sides. Not sure about the rules on links anymore but here is the link to Terrys site. https://www.hotspotting.com.au/ Worth a look. It has been a few years since I have purchase a report but I found value in them at the time.
Who knows you may end up investing somewhere completely new and it will be an exciting life adventure as you learn a new location and a build a new local team.
@don,
Do you find that there is a stream of tenants looking to rent on the central coast or is there a bias towards owner occupier on the central coast.
Not to doubt your numbers but…..those sound like really high ROI numbers. Do you want to suggest some suburbs that you’ve found rental returns like that?
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This reply was modified 9 years, 9 months ago by
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