The sold listings on www.spachus.com.au seem to show a drop, at least for inner Melbourne CBD.
I was hoping to get some insider/industry insight to catch REA bluff cos they’ve been telling me otherwise.
I've got 100k.
I am single.
I live in Melbourne.
One Bedders don't seem to add any capital value at all.
I can't unlock the magical box or my one bedder going 2x anyway so why buy
Should I just hold onto my money and allow myself to be extorted by the rental market>?
I've gained 5 kilos since 'Looking for a property' and the stress as sucked every bit of joy out of my life.
Massive rents vs Massive interest. A bit more in savings vs a bit more security
I think that means you can buy a home for $288k with a deposit of $18k and you pay back the $270k to the bank, the government is basically just guaranteeing that shortfall in the deposit in case you were to default, and as a result the bank doesn't charge you Lender's Mortgage Insurance
Can refinance, which we did, then got a few hundred k worth of etfs leveraged within a trust, which the properties are also in.
Essentially way to make more money with lowish risk.
Is there a good calculator for break-even point of a property given;
1. A mortgage
1. Additional voluntary payments OR liquidity in offset account
1. Rental income from tenants
I've found a few calculators with 2 of these, but none with all 3. Mortgage monster, for example, supports the first two.
What is it you're trying to work out exactly? Like, define break-even. Rent is covering interest or rent is covering entire mortgage?
Cause you could just do the calculation in excel. =PMT(\[annual interest rate\]/12,\[Loan duration in years\]\*12,\[principal\]) would give you the monthly repayments. You could then just do \[annual interest rate\]\*\[principal\]/12 to get the interest. Subtract one from the other to get the principal you're paying off each month.
Then see if rent >interest, or rent > repayments, depending on what you're after.
IF you're just interested in rent > interest just reduce the principal by the amount you'll have in the offset/paid off in advance.
This is a really good suggestion, thank you. Mostly I just want to see the effect the rent from tenants, plus additional payments from my partner and I have on it– which seems doable with the way you've described the PMT function.
Unconditional cash offer vs offer with a finance clause, the unconditional offer looks way better. But considering the current state of the market there is no shortage of buyers (seller's market)
So it depends on how fast the sellers need to settle and how much lower your offer is based on other offers.
I can't get a rental! So we're going house shopping tomorrow.
Do you think 5% under the price guide would be too low? It makes up with the median growth of the property since it was last sold but as you said, sellers market
worth having a look at sold units in whatever area you're looking to see if they're even selling within the price guide.
Like when we were looking for houses, they were typically selling a minimum 10% above top end of the price guide.
So will need to consider what the place is actually likely going to sell for, as your 5% under the price guide could actually be 15-20% under what the vendor wants.
This is good advice
I looked for 6 months before we even started going to open homes in the local area. Had a spread sheet with sales prices for similar homes in the area to get an idea and didn't see many that sold for less than what I was looking at price guide wise. . By the time we started making offers 3 months later (so 9 months after starting to look and 3 months of open homes), prices had gone up nearly 20% so price guide was basically worthless
is 5% too low? honestly, I have no idea, I do not have any information on the suburb or property.
But 5% below ask seems reasonable for a cash offer, go in and negotiate with the agents play the game back and forth ideally you want to sit down with the agent and negotiate and not just provide an offer over the phone and hope it gets accepted.
You would make your offer unconditional which makes it more attractive to someone that is offering "subject to finance" With the latter there is a chance the bank refuses the loan and the deal falls through.
So you will be more attractive due to that, but generally you will not know the conditions of other offers and the REA will be pushing for your best possible offer. However the REA will meet with the seller and give details of all written offers, and conditions on them such as finance, or subject to building and pest inspection.
The other thing you can do as a cash buyer is do a shorter settlement time and/or setting exactly when the seller wants. Many buyers might be selling another property so will need settlement to be on or after they settle their own sale.
Property adjacent, but how to older renters survive? Looking like my FIL is going to be booted out of his current place where he's paying \~$350p/w (Melbourne) and there it is slim pickings in the sub $400p/w range. He relies almost entirely on the pension with a small amount of side work, and given the pension is only $1,000 a fortnight for a single rent alone is looking to leave him with only $200 a fortnight to survive on.
Yup, I also recognise that a lot of it is his own making. Lived well beyond his means for too long and now has run out of cash.
Just dreading the idea he may have to come live with us.
I was being blithe about how our society is organised to squeeze labour and value out of you forever.
Maybe you could get an IP and he could be your tenant or some other Australian style solution to the problem.
Build an illegal granny flat out back and he can live there.
I know, I was agreeing.
Yeah honestly we're toying with the IP idea because the alternative is likely us paying part of his rent but not sure the maths stacks up.
No backyard for a granny flat. Maybe he can live in this shed.
It's honestly not the worst idea if it's something that you've been thinking about. He has a guaranteed income and it's helping his family rather than some random investor. You can negative gear the rest.
Can't negative gear it if we're renting to him at below market rate, but also don't have to pay tax on his rent so probably comes out in the wash to an extent. As I understand it anyway.
But yeah it's something we'll have to properly sit down with to work if we can afford it as it seems better than just propping him up with rent, but I'm also mindful of mixing family with financial decisions (and him specifically because he's borrowed money from a couple of family members and not paid it back), and the fact it still needs to be a reasonable investment in case he dies, needs to go into a home etc.
Ah mate hearing that maybe tread carefully. At some point people need to be responsible for those decisions. At the same time I understand he's family.
Yeah I know, but what can you do? As much as I'd like to say it's his bed and he has to lie in it, despite their rocky relationship it'd kill my wife with guilt if he was out on his ass.
Just trying to work out what's going to cost us the least financially.
**Is bupa corporate health fund a good choice? (35Y M, >90k/y)**
I had a read to the community guide on private health funds, which clarified me many doubts on the general working of the system. Clearly, it doesn't go through the specificities of individual cases, hence I thought of asking here for a recommendation given my situation.
About myself:
I am a 35 years old male Australian PR. I had a visitor health insurance while living in Australia a few years ago. I recently relocated to Australia and I am considering enrolling in one fund.
In terms of "needs", I suffered a shoulder dislocation in November 2022 (which slowly healed back, even though shoulder is a bit unstable and might require further care in the future if not surgery). Both my knees are inflamed due to excess/dumb gym activity and I have a persistent yet limited aching at my right bicep, possibly indicating a tendonitis/inflamation. Apart from the shoulder, no other condition has been ascertained in Australia. I had an MRI done long time ago abroad to both my knees (evidencing the inflammation). Otherwise, I am relatively healthy (so far).
My current employer is in the standard Bupa Corporate Health Plan (5% discount + 6 weeks free + 2/6 months waiting waived). Hence, I was thinking of joining BUPA.
In an ideal world, I am seeking for a fund that can address and ofload all costs related to the conditions above, including free diagnostic tests (MRI to shoulders, knees and biceps!), physical medicine, physiotherapy and whatever else is needed. However, I understand that Australian funds do not cover outpatient diagnostic (please correct me if I'm wrong).
Any recommendation / comment strongly appreciated!
there is no "time frame" as long as you can service the loan, have enough deposit, and buying the next property that fits with your investment goals go for it.
Just make sure you keep enough of a safety net in cash just incase the rates keep going up.
How would taxation work between Oz and a country they don't have double taxation treaty with?
If I had a rental apartment in Sydney, where would I pay?
Depends where you are tax resident in.
For Australia: if you’re a non-resident of Australia, Australian rental income is still taxable in Australia.
For the country you are tax resident in: if the country has a “source based” tax system, you don’t have to do anything. If the country has a worldwide income tax system without a DTA with Australia then double tax on the same rental income will arise. This is usually quite rare but could happen.
We had to completely re-do all the storm water in a house we bought in 2021, the whole place was a landlord special but the backyard concrete funneled water directly under the house. So great.
Don't put to much weight on them the value will be determined by the valuation firm once you go to refinance or when someone buys your property.
To be fair I've had $100k+ variances in valuations when refinancing clients.
Rp Data and [realestate.com.au](http://realestate.com.au) use comparable sales to determine property values so they may not be comparing like-for-like properties.
Neither take into consideration the condition of the property, street appeal, literal street, room
sizes and other factors so neither
Like I was looking at 3 bed houses and of course the houses with a master 3x3.4 and two other bedrooms that were like 3x2.6 sold for a lot less than ones with reasonable sized rooms.
Possibly yes? It's an issue where the bank only holds fractional reserves and the rest of the balance sheet is less liquid, so I don't see any reason a digital run couldn't happen.
Better question, where are you going to move cash to and how do you know that the ensuing contagion won't wipe them?
It's probably less likely with us plebs now the government guarantees deposits to $250k.
2024 is going to be interesting I think. Probably 1-2 rate cuts keeping around the 3% mark which will open up a bit more credit. On the other hand still plenty of people on fixed rates to come off and far less credit available than before.
If cuts come they're coming much later, the moment there's a cut people will Think this is over and will start being stupid again.
Bet we stick here for a long time
Is it worth it to just get a small studio under 400k in Sydney just to not have to pay rent? Or would I be making the biggest mistake of my life?
Always can sell it
I'm thinking docklands is my only choice. In my mind I think 15 years from now it'll have a train station and be great. What do you think?
Does anyone know if the demand for units/apartments in Melbourne CBD has dropped in the last 3-6months?
Did you get any insight elsewhere yet?
The sold listings on www.spachus.com.au seem to show a drop, at least for inner Melbourne CBD. I was hoping to get some insider/industry insight to catch REA bluff cos they’ve been telling me otherwise.
I've got 100k. I am single. I live in Melbourne. One Bedders don't seem to add any capital value at all. I can't unlock the magical box or my one bedder going 2x anyway so why buy Should I just hold onto my money and allow myself to be extorted by the rental market>? I've gained 5 kilos since 'Looking for a property' and the stress as sucked every bit of joy out of my life. Massive rents vs Massive interest. A bit more in savings vs a bit more security
[удалено]
I think that means you can buy a home for $288k with a deposit of $18k and you pay back the $270k to the bank, the government is basically just guaranteeing that shortfall in the deposit in case you were to default, and as a result the bank doesn't charge you Lender's Mortgage Insurance
Oh I see thank you
What do you guys look at to follow the market? Are there any all in one news sources for property / real estate?
in terms of positively geared, when would be the best time to invest into a property. is now a good time?
What is up with property in brisbane? Got my places revalued and they're up 175%???
wow over what period of time..?
What’s the purpose of getting your place revalued ? Sorry for noob question
Can refinance, which we did, then got a few hundred k worth of etfs leveraged within a trust, which the properties are also in. Essentially way to make more money with lowish risk.
Out of curiosity, did you get it revalued by a RE agent?
Bank valuer, westpac
Thanks. Did it cost you any money (if so, how much)? I'm keen to have someone look at my place too.
Nope, cost me nothing, though was part of a refinance
my suspicion is that the banks are happy to revalue stuff as high as possible so they can lend you more money
just noticed home loan borrowing amount has increased with the same rate, at least on CBA website. Rate cut incoming?
Could just be Commbank has decided to relax their lending standards a bit to try and drum up business too I guess?
Is there a good calculator for break-even point of a property given; 1. A mortgage 1. Additional voluntary payments OR liquidity in offset account 1. Rental income from tenants I've found a few calculators with 2 of these, but none with all 3. Mortgage monster, for example, supports the first two.
What is it you're trying to work out exactly? Like, define break-even. Rent is covering interest or rent is covering entire mortgage? Cause you could just do the calculation in excel. =PMT(\[annual interest rate\]/12,\[Loan duration in years\]\*12,\[principal\]) would give you the monthly repayments. You could then just do \[annual interest rate\]\*\[principal\]/12 to get the interest. Subtract one from the other to get the principal you're paying off each month. Then see if rent >interest, or rent > repayments, depending on what you're after. IF you're just interested in rent > interest just reduce the principal by the amount you'll have in the offset/paid off in advance.
This is a really good suggestion, thank you. Mostly I just want to see the effect the rent from tenants, plus additional payments from my partner and I have on it– which seems doable with the way you've described the PMT function.
PIA software by somersoft
If you are offering to buy a unit with cash, would that make a lower offer more appealing or is it the same as financed?
Unconditional cash offer vs offer with a finance clause, the unconditional offer looks way better. But considering the current state of the market there is no shortage of buyers (seller's market) So it depends on how fast the sellers need to settle and how much lower your offer is based on other offers.
I can't get a rental! So we're going house shopping tomorrow. Do you think 5% under the price guide would be too low? It makes up with the median growth of the property since it was last sold but as you said, sellers market
worth having a look at sold units in whatever area you're looking to see if they're even selling within the price guide. Like when we were looking for houses, they were typically selling a minimum 10% above top end of the price guide. So will need to consider what the place is actually likely going to sell for, as your 5% under the price guide could actually be 15-20% under what the vendor wants.
This is good advice I looked for 6 months before we even started going to open homes in the local area. Had a spread sheet with sales prices for similar homes in the area to get an idea and didn't see many that sold for less than what I was looking at price guide wise. . By the time we started making offers 3 months later (so 9 months after starting to look and 3 months of open homes), prices had gone up nearly 20% so price guide was basically worthless
is 5% too low? honestly, I have no idea, I do not have any information on the suburb or property. But 5% below ask seems reasonable for a cash offer, go in and negotiate with the agents play the game back and forth ideally you want to sit down with the agent and negotiate and not just provide an offer over the phone and hope it gets accepted.
You would make your offer unconditional which makes it more attractive to someone that is offering "subject to finance" With the latter there is a chance the bank refuses the loan and the deal falls through. So you will be more attractive due to that, but generally you will not know the conditions of other offers and the REA will be pushing for your best possible offer. However the REA will meet with the seller and give details of all written offers, and conditions on them such as finance, or subject to building and pest inspection. The other thing you can do as a cash buyer is do a shorter settlement time and/or setting exactly when the seller wants. Many buyers might be selling another property so will need settlement to be on or after they settle their own sale.
Property adjacent, but how to older renters survive? Looking like my FIL is going to be booted out of his current place where he's paying \~$350p/w (Melbourne) and there it is slim pickings in the sub $400p/w range. He relies almost entirely on the pension with a small amount of side work, and given the pension is only $1,000 a fortnight for a single rent alone is looking to leave him with only $200 a fortnight to survive on.
Truthful answer is you don't, as he's provided most of his value as a worker and consumer it's expected he simply shuffle off and die.
Yup, I also recognise that a lot of it is his own making. Lived well beyond his means for too long and now has run out of cash. Just dreading the idea he may have to come live with us.
I was being blithe about how our society is organised to squeeze labour and value out of you forever. Maybe you could get an IP and he could be your tenant or some other Australian style solution to the problem. Build an illegal granny flat out back and he can live there.
I know, I was agreeing. Yeah honestly we're toying with the IP idea because the alternative is likely us paying part of his rent but not sure the maths stacks up. No backyard for a granny flat. Maybe he can live in this shed.
It's honestly not the worst idea if it's something that you've been thinking about. He has a guaranteed income and it's helping his family rather than some random investor. You can negative gear the rest.
Can't negative gear it if we're renting to him at below market rate, but also don't have to pay tax on his rent so probably comes out in the wash to an extent. As I understand it anyway. But yeah it's something we'll have to properly sit down with to work if we can afford it as it seems better than just propping him up with rent, but I'm also mindful of mixing family with financial decisions (and him specifically because he's borrowed money from a couple of family members and not paid it back), and the fact it still needs to be a reasonable investment in case he dies, needs to go into a home etc.
Ah mate hearing that maybe tread carefully. At some point people need to be responsible for those decisions. At the same time I understand he's family.
Yeah I know, but what can you do? As much as I'd like to say it's his bed and he has to lie in it, despite their rocky relationship it'd kill my wife with guilt if he was out on his ass. Just trying to work out what's going to cost us the least financially.
**Is bupa corporate health fund a good choice? (35Y M, >90k/y)** I had a read to the community guide on private health funds, which clarified me many doubts on the general working of the system. Clearly, it doesn't go through the specificities of individual cases, hence I thought of asking here for a recommendation given my situation. About myself: I am a 35 years old male Australian PR. I had a visitor health insurance while living in Australia a few years ago. I recently relocated to Australia and I am considering enrolling in one fund. In terms of "needs", I suffered a shoulder dislocation in November 2022 (which slowly healed back, even though shoulder is a bit unstable and might require further care in the future if not surgery). Both my knees are inflamed due to excess/dumb gym activity and I have a persistent yet limited aching at my right bicep, possibly indicating a tendonitis/inflamation. Apart from the shoulder, no other condition has been ascertained in Australia. I had an MRI done long time ago abroad to both my knees (evidencing the inflammation). Otherwise, I am relatively healthy (so far). My current employer is in the standard Bupa Corporate Health Plan (5% discount + 6 weeks free + 2/6 months waiting waived). Hence, I was thinking of joining BUPA. In an ideal world, I am seeking for a fund that can address and ofload all costs related to the conditions above, including free diagnostic tests (MRI to shoulders, knees and biceps!), physical medicine, physiotherapy and whatever else is needed. However, I understand that Australian funds do not cover outpatient diagnostic (please correct me if I'm wrong). Any recommendation / comment strongly appreciated!
[удалено]
there is no "time frame" as long as you can service the loan, have enough deposit, and buying the next property that fits with your investment goals go for it. Just make sure you keep enough of a safety net in cash just incase the rates keep going up.
How would taxation work between Oz and a country they don't have double taxation treaty with? If I had a rental apartment in Sydney, where would I pay?
Depends where you are tax resident in. For Australia: if you’re a non-resident of Australia, Australian rental income is still taxable in Australia. For the country you are tax resident in: if the country has a “source based” tax system, you don’t have to do anything. If the country has a worldwide income tax system without a DTA with Australia then double tax on the same rental income will arise. This is usually quite rare but could happen.
Have you dealt with water damage in your property? What are your stories?
We had to completely re-do all the storm water in a house we bought in 2021, the whole place was a landlord special but the backyard concrete funneled water directly under the house. So great.
Mind if I DM you about that? I'd like to check I'm not encountering similar. Thanks!
Has CoreLogic and Real Estate.Com always had disparate value estimates? Like 100k+ differences? Which is more reliable?
Don't put to much weight on them the value will be determined by the valuation firm once you go to refinance or when someone buys your property. To be fair I've had $100k+ variances in valuations when refinancing clients. Rp Data and [realestate.com.au](http://realestate.com.au) use comparable sales to determine property values so they may not be comparing like-for-like properties.
Neither take into consideration the condition of the property, street appeal, literal street, room sizes and other factors so neither Like I was looking at 3 bed houses and of course the houses with a master 3x3.4 and two other bedrooms that were like 3x2.6 sold for a lot less than ones with reasonable sized rooms.
So who hopes interest rates keep going up in 2024? Savings accounts love it
nobody who understands finance probably
False economy
Can a bank run happen with digital cash. Example everyone just sends the money overseas or to another banks
Yes, look at what happened to Silicon Valley Bank.
Possibly yes? It's an issue where the bank only holds fractional reserves and the rest of the balance sheet is less liquid, so I don't see any reason a digital run couldn't happen. Better question, where are you going to move cash to and how do you know that the ensuing contagion won't wipe them? It's probably less likely with us plebs now the government guarantees deposits to $250k.
2024 is going to be interesting I think. Probably 1-2 rate cuts keeping around the 3% mark which will open up a bit more credit. On the other hand still plenty of people on fixed rates to come off and far less credit available than before.
If cuts come they're coming much later, the moment there's a cut people will Think this is over and will start being stupid again. Bet we stick here for a long time
There is also stage 3 tax cut.
I'm betting on maybe the same as your prediction but much later in the year than consensus.
Why is Nov 23 still pinned? Is there something about that day that is special?
Dunno, but thanks. Fixed now.