wow I didnt think this would be such a hot topic.
Id like to reply to each response but instead Ill simply outline our situation and reasoning for considering this, and give some figures to try and make better sense of it.
But firstly its fair to say that everyone has different expectations for a so call investment property. And the true sense of the word 'investment' may not be the right term if your expectations are some what different to perhaps a person in a bigger city who at some stage wants returns on interest paid and all expenses occurred in the shorter term.
For us it is a real simple (I am a simple man who lives a very simple life
) scenario of buying a modest property and having a tenant pay for that property over the next 20 years and then sell the property to give us some extra money in retirement. Why cant it be that simple??
So just to give some clarity Ill give some figures so you understand we are not talking sheep stations here, so my idea of an 'investment' property is going to be far removed from those of you that have a lot of money on the line in other parts of the country.
The house is only $150k and it is currently returning $165 per week after realestate fee's in income. We were considering mortgaging it separately to anything else we have going on, so we were thinking of paying a 30K deposit (only financing 80%), this would leave us with repayments of around $140 per week.
So as you can see it is chicken feed compared to you wealthy mainlanders!! So to answer some of the concerns, yes we are able to cover the loan repayments if we have a period of time it is not occupied. Yes we have enough savings to cover unexpected costs that will arise from time to time.
The property is cheap because of the situation of the current owners. In fact vacant lots of land the same size as this block of land (just over 1000sm) in this area are selling for this sort of money.
It is near shops, schools etc and has a very nice outlook. The dwelling on it is nothing special but it is clean and tidy and only about 13 years old, albeit very basic.
Growth down here is not great but who knows when the next real estate boom may be?
But having said that, there is absolutely zero chance of this properties value going down, in fact I believe we have an opportunity to grab it a very good price.
So once again we are simply considering buying it so we can one day sell it to give us some more money in retirement. Or who knows, perhaps we will be comfortable in retirement and we will keep it for the kids or perhaps I might get hit by a bus tomorrow so who knows how the next 20 years will pan out.
But having said all that, the only variant may be in how we go about this. I appreciate all the replies and suggestions of how best to do this, it has given us a lot to consider.
We are also in the process of preparing 4 acres of land near Launceston to build our final resting place so to speak
Sounds morbid, but it will be our final home in life if everything pans out as we expect........
So we need to be careful not to jeopardise our plans there. Next week we are anticipating talking to the bankers to make sure we can make our future plans work.
Sadly my grandfather passed away about 12 months ago and he left us kids with an opportunity to get ahead a little in life, so another reason we are considering this property is to make the most of the position he has put us in.
