Linda Lushardi

Thanks Jackie. We are really enjoying ourselves right now and i hope you get to do the same when you come down here.

We already have money in ING have been topping it up over the last 2yrs.When we finally do buy we hope to have a large deposit and hopefully a home at a lower price therefore leaving us with a much smaller mortgage.
Of course in the really long term it is best to buy a property, but certainly NOT at grossly over inflated prices, especially as a downtrend is forecast.

OriginalSunshine

to all you renters out there

who pays the rent when you retire? do you have enough retirement savings to do that for the next 30+ years?

Linda Lushardi

I dont think anyone intends to rent into retirement,we are talking about renting until we feel its right for our own personal circumstances to take the leap and buy.

And yes, we have good pension funds and are still saving each month due to NOT having huge mortgage payments.

bri.thomson

Who sais a mortgage repayment has to be huge.

Live by your means and not your ego and you cannot go wrong.

My motto is "That a big house, doesn't mean big people to go with it" Normally you find its quite the opposite!

OriginalSunshine

fair enough - that wasnt the impression I got from everyone here though, and I was/am genuinely curious.
good for you!

ugez009sumi

A number of points:

-this article main message is, if you have a pile of equity in your place, realise it now, as it might go. This is sensible. Likewise you could say, borrow against this equity when you have it, not when you need to Use this equity to buy a new asset that out performs the borrowing-USE THE EQUITY AS IT MIGHT GO.

-you can never hit the bottom of the market; point is you in the market long term you can ride out any us and downs. I have tried this with trading shares; you can never get top or bottom. It depends on your age if you are 25-35 buying a place in Aus you have a few yrs for these peaks and troughs to level out. Also if you treat a home as a home not an investment vehicle that cares as long as you can pay your mortgage and have money left over to enjoy life.

-I am going to Sydney fib 4th. I am going to buy a place after 6 months renting. My thinking is long term, maybe prices go down in 1 year, but longer term they should go up. I might not be in Sydney for ever, maybe I only go for 5 years, but I will rent the place out when I leave. Same way I rent out my flat here. Let’s say it is a gamble, maybe when I am 65 it will be worth a pile and someone has been paying that mortgage.

-As log as you do not get too exposed to property, have other asset classes such as equities, cash etc, I personally think property investment in good location in Aus will be excellent investment.

-it depends on your age and where you are in your life, I rented until I was 32. I am 36 now. I liked flexibility and no reponsibity of renting. Now I am thinking more about future, retirements, having stability in my life, I think buying is the best option.

Do not be panicked by Journos…don’t believe all you read…they are always writing doom and gloom articles-this is their job.

ossigeno

Unless you intend to have something like 50% equity in a Sydney property you will have to make up a considerable shortfall on the rental income to meet the mortgage repayments. It is completely different to the UK out here, rents are far, far lower than mortgage repayments at the moment. My own rent is $1500/month, a 90% mortgage on same property would cost $3500/month interest only.

merlotsmum

I am enjoying reading the feedback, I have to say we are of the mind set of when we are ready to buy we will start the search and live within our means mortgage wise

Linda Lushardi

Totally agree with you.
Our rent is similar to yours. From looking at recent sales in this complex, ours would probably sell for between $5 - 600,000. (although could be less now with the dowtrend) Whilst i love where we live. It is immaculately maintained and looked after (all at landlords expense i may add, and i found out yesterday they pay $1500 a quarter in strata fees!! :scared: so add that on top of the mortgage) I would NEVER consider buying one at this kind of price. I'd be mad to even consider it.
I pay $400pw week which gives me free access to the pool and gym, BBQ area, tennis courts, basketball courts, fully maintained landscaped parkland right outside our door, and underground securuty parking. Why would i trade that in to service a half million dollar mortgage plus strata fees on top?!!!

Ozziedoc is correct in saying the property market down here is way, way different to that of the UK. There is also a different mentality to owning your own home. I found in UK that NOT owning a property somehow affected your status within society, here it is very different.

NedKelly

Even if you do have 50% equity you should consider the lost interest if you had the money in the bank as it is dead money.

TrickyTree

I'm with you Bri I would say be careful with what the banks will offer you as it seems to bare no resemblance to what you earn. When we did the mortgage hunt we were offered between 500k and 600k.

I can now say we have a mortgage for less than half the first amount as going to the top end would have left us very exposed to rate rises. Which leaves us plenty to enjoy life to the full.

Linda Lushardi

Another avenue we have been looking at is buying a property in a less expensive area and renting it out whilst we remain renting in Sydney. This way we get to keep on enjoying our lifestyle yet still be in the property market. Too early to say whether we would do this but it is another option for us.

ABCDiamond

It's the Tax deductions that allow it to work that way. Many investors are making a loss, but after various tax deductions they end up cash positive

Various new reports have shown that rents are beginning to increase in many areas. Eventually the Rent v property price will get back to the "normal" rate.
There are of course some areas that have a glut of properties, (mainly Apartments) and these areas will hold low rentals for some time.

Also, some areas are quoted as having hit the bottom in property prices, whilst other areas are still either rising or falling.

A crystal ball would really help

merlotsmum

Gosh . . . . . anyone got a crystal ball?

Snowflake_011

It's always dodgy to invest in something purely for tax reasons. Surely if an investment doesn't have sound fundamentals, it isn't worth investing in to begin with, even with the bonus of a tax break. A lot of SIPP investing has been driven by the tax advantages, without much thought IMHO to the quality of the underlying investments.

Snowflake


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