It might sound crazy but the first home you buy – may not be your own.
If you’re a first home buyer in Sydney you’re not wrong if you think prices are going crazy right now – they are. And this makes it incredibly hard to keep saving a 5% or 10% deposit when the goal posts keep moving on you.
And it’s not a lot better in the other states.
The flip side of this, of course, is affordability… if the prices are rising so are your repayments…and this may put it out of reach. So how can you get started without bankrupting yourself?? Have you ever heard me talk about “rent where you want to live, and buy where you can afford?”
(gosh really? I thought I was always banging on about this…)
For loads of reasons smart buyers are turning to investing in locations that are affordable, rising, and make sense.
Your primary motivation is probably going to be affordability, but what if you have really cheap rent or you want to live at home a little longer and build a portfolio to take advantage of your circumstances, this is a perfectly reasonable strategy.
Knowing how the market works, if staying at home allows you to buy and hold 2 or 3 properties, instead of the only one you could afford if you were living in it, then does this give you an opportunity to pay off those properties along with the help of your tenants and watch them grow in value to a point where you could sell them and have a really sizeable deposit for your future home? Or better perhaps there will be enough equity in the group of them to allow you to buy a home outright? How does this sound?
Its not impossible and I certainly have client who are investors who have done exactly this.
The other point is it might allow you to buy in areas that you can afford but can’t possibly live in, for example interstate when you work in Sydney. When there are areas interstate where houses are selling for under $400,000 and have excellent rent returns this could be a perfect opportunity.
Full article in the Western Weekender https://issuu.com/weekenderpenrith/docs/property2june/26