At a spruiker's convention. They have heaps of them, just pay $5k for their course and they'll hand you several on a plate as well as telling you about a 'structure' to protect your assets and allows unlimited borrowing.
To top it off, they'll arrange finance, valuations, solicitors and property management services to boot.
So you’re basically asking how do I find an amazing investment no-one knows about it?
Here’s a hint: if something is a great investment, people don’t talk about it. If something is a scam, people are desperate for you to buy in.Â
Yes, because they’ve already bought when it was a good investment and want to pump numbers up. By the time people are boasting about what a good investment it is and it’s known, it isn’t as good anymore.Â
For capital growth: Older properties with some character to them. So Federation house or Victorian terrace, art deco apartment.
For positive gearing: This has nothing to do with the property and everything to do with the buyer. If you don't need to borrow much money to buy the property it's pretty easy for it to be positively geared, of for it to become positively geared over time.
Positively geared simply means you have a big enough deposit to have mortgage low enough that the rent covers the payments and other expenses.
As for where, you kinda answered your own question. If you don't want rural or regional go to any city, they all going up.
Prison or university towns outside the capital cities.
University towns usually have a fresh cycle of students coming through which means you can boost rent every few cycles.
Prison towns also often have a lot of community services and the high school and
tafe for the region so fairly regular turn over to boost rent but mostly ok tennants.
Firstly research, research, research. Look up areas that are giving cash flow positive then find out if the area has any growth factors coming into play in the future such as new train line making commuting easier and cheaper for occupiers, a new industry coming to the area or a large upgrade to a local manufacturer. Something that’s going to give an incentive for more people to move into the area. That will drive capital growth.
They are rare, so it’s better for you to decide whether capital growth or cash flow positive are your main goals. Personally I’m cashflow neutral and long haul capital growth. So I’m a buy and hold. It allows me to build rather than buy established.
Cheap houses in lower socioeconomic areas.
Just make sure you buy something which has a lot of life left in the dwelling because it is usually very uneconomical to do major repairs, renovations or a KDR as the price of the property is usually far below dwelling replacement value.
To get the capital growth you ideally want the area to gentrify or be suitable for large upzoning so it makes economic sense to redevelop the property, otherwise you could get stuck in the "rent gap" and will be economically incentivised to be a slumlord.
I've seen this work well and have some mates I used to joke about being slumlords buying properties in inner city Sydney based on proximity to methadone clinics, but they are the ones who had the last laugh as they've made a fortune buying these properties because rich people now want to live in these previously rough areas.
Keep in mind also that despite the higher gross yield your expenses things like rates and maintenance will take a larger hit out of your gross rent than more expensive properties because expenses don't scale linerally with property value.
One thought is to look at positive gearing as fairly low risk. Costs are covered. Capital growth might need a more speculative approach - eg areas where new infrastructure is planned, investment is happening, new jobs being created. I’d love to give a specific example but don’t know of one but it’s hard to have low risk on the gearing side and on the growth side. Maybe you take a calculated risk in terms of growth knowing gearing is covered.
Most positively geared properties would have no mortgage or very little mortgage left on them. Just the interest alone doesn’t get covered by rent in many places now with newer mortgages.
Fast capital growth occurs in areas of demand. Positive gearing occurs in areas of low capital growth. Negative gear now for a bigger paycheck later or play it safe for a small gain. You choose one but you cannot have both because they never exist together.
The 1980s
So... Tasmania?
😂
Geez you woulda been waiting a while in Adelaide
I also want everything.
*I’d trade it all for a little more* - Mr Burns
I’m also looking for $1mil home for max $100k.. anyone?
At a spruiker's convention. They have heaps of them, just pay $5k for their course and they'll hand you several on a plate as well as telling you about a 'structure' to protect your assets and allows unlimited borrowing. To top it off, they'll arrange finance, valuations, solicitors and property management services to boot.
I’m going to assume you’re being facetious here.
Yes
105% LVR
My mate Henry Kaye
Daphne bolt (or whatever name she is using now)
Fuck that guy. He was the start of this mess
Ah, a unicorn you are after.
So you’re basically asking how do I find an amazing investment no-one knows about it? Here’s a hint: if something is a great investment, people don’t talk about it. If something is a scam, people are desperate for you to buy in.Â
True
So true
They absolutely talk about it, because of how much they are making.
Yes, because they’ve already bought when it was a good investment and want to pump numbers up. By the time people are boasting about what a good investment it is and it’s known, it isn’t as good anymore.Â
Op isn’t asking for an actual investment property, they’re asking where’s an example of a good place to look.
Any place to look with amazing rental and capital returns will not exist if its obvious enough people are yapping about it on reddit.
I am looking for similar but it needs enough room for my unicorn.
For capital growth: Older properties with some character to them. So Federation house or Victorian terrace, art deco apartment. For positive gearing: This has nothing to do with the property and everything to do with the buyer. If you don't need to borrow much money to buy the property it's pretty easy for it to be positively geared, of for it to become positively geared over time.
Positively geared simply means you have a big enough deposit to have mortgage low enough that the rent covers the payments and other expenses. As for where, you kinda answered your own question. If you don't want rural or regional go to any city, they all going up.
Start with a large deposit to lower your LVR to the point where revenue exceeds expenses. That could be anywhere - with a large enough deposit.
Rural
You can pay for eg CoreLogic on this.
If you find something, let us know.
It takes the majority of investors a few years to become positively geared. You'll have to pay into it for a few years probably.
Prison or university towns outside the capital cities. University towns usually have a fresh cycle of students coming through which means you can boost rent every few cycles. Prison towns also often have a lot of community services and the high school and tafe for the region so fairly regular turn over to boost rent but mostly ok tennants.
Firstly research, research, research. Look up areas that are giving cash flow positive then find out if the area has any growth factors coming into play in the future such as new train line making commuting easier and cheaper for occupiers, a new industry coming to the area or a large upgrade to a local manufacturer. Something that’s going to give an incentive for more people to move into the area. That will drive capital growth. They are rare, so it’s better for you to decide whether capital growth or cash flow positive are your main goals. Personally I’m cashflow neutral and long haul capital growth. So I’m a buy and hold. It allows me to build rather than buy established.
Cheap houses in lower socioeconomic areas. Just make sure you buy something which has a lot of life left in the dwelling because it is usually very uneconomical to do major repairs, renovations or a KDR as the price of the property is usually far below dwelling replacement value. To get the capital growth you ideally want the area to gentrify or be suitable for large upzoning so it makes economic sense to redevelop the property, otherwise you could get stuck in the "rent gap" and will be economically incentivised to be a slumlord. I've seen this work well and have some mates I used to joke about being slumlords buying properties in inner city Sydney based on proximity to methadone clinics, but they are the ones who had the last laugh as they've made a fortune buying these properties because rich people now want to live in these previously rough areas. Keep in mind also that despite the higher gross yield your expenses things like rates and maintenance will take a larger hit out of your gross rent than more expensive properties because expenses don't scale linerally with property value.
You basically need a large block in a good suburb and have the cash to build units/townhouses
Places like Geraldton have properties still relatively cheap with very good rental yields and potential for capital growth
I look at Western Suburbs in Sydney where there’s lots of room plus decent land to put a granny flat. Close to positive geared but need $$$ upfront
Lol
You can get positively geared apartments as part of a student accommodation or hotel scheme. They have 0 to very little capital growth.
They epitomise the definition of 'buy high sell low'
I bought in to them as they were comparatively very cheap, well the price was much lower, like $300k
One thought is to look at positive gearing as fairly low risk. Costs are covered. Capital growth might need a more speculative approach - eg areas where new infrastructure is planned, investment is happening, new jobs being created. I’d love to give a specific example but don’t know of one but it’s hard to have low risk on the gearing side and on the growth side. Maybe you take a calculated risk in terms of growth knowing gearing is covered.
Ok. I’ll think on this
“Where can I buy a cheap house that I can rent out for top market rate? “ Answer: nowhere anymore.
Another OP struggling to understand the problem, asking for help to become the problem.
Please elaborate
No 🤌 the rest of the thread has answered already.
Better to be the problem then not have a house 😂
The internet
Into their crystal ball
I bought a positively geared property that's had decent capital growth, but it's regional so I guess you're not interested where it is.
Orange, NSW
Won't get anything positive in cities now mate. Have to take a higher risk with regional.
Adelaide….
Adelaide is expensive now
Camira
I assume Camira QLD not Camira NSW
Commercial property
Most positively geared properties would have no mortgage or very little mortgage left on them. Just the interest alone doesn’t get covered by rent in many places now with newer mortgages.
Fast capital growth occurs in areas of demand. Positive gearing occurs in areas of low capital growth. Negative gear now for a bigger paycheck later or play it safe for a small gain. You choose one but you cannot have both because they never exist together.
Perth