G'Day!

[Vas87]

Hello from down under! I am a 25 yr old male, recently graduated from university and have been working full time for the past 4 months and have realised "the slow lane" is not for me. While my pay is really good for a graduate, I would like to free up my time to do the thing I love: travel and still comfortably support myself.

I am interested in real estate and initally the goal was to buy an old house, demolish it, subdevide and devlop the land. It seems a bit slow lane though as it would take years to build up a sizable portfolio which would provide enough passive income.

So at the moment I am a bit stuck with what to do. I work as an optometrist, so trying to figure out if I can do something "fastlane" in that field .

 

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[OzGrinder]

Hi mate

Someone else from Oz! I would personally recommend staying well away from Australian real estate for the time being. It has made many a fortune but I think those days are gone for a while. The fact that I rent when I could buy a home in cash is a testament to my belief that real estate in Australia is overvalued.

If I can buy a townhouse for 400k but rent it for $300 a week, then the numbers just don't stack up. I'm better off renting and investing the capital because the rental yeilds are too low. That's without factoring in stamp duty, rates, maintenance and also assuming a cash purchase. As soon as you factor in all those things as well as interest on a loan it becomes an even lower yielding investment, which means you're hoping for capital gains ie. speculating, the fundementals (ROI through rental yields) just don't justify it.

Housing in Australia at the moment is a luxury not an investment. You pay a premium to live in something you own, as opposed to having to answer to a landlord (which admittedly does suck) for a much cheaper price. I would not call it an investment at this time. 15 years ago, different story, markets outside Australia, different story also. Just my thoughts.

If you want to invest in property and develop it, sit down and calculate everything. You'll have to make some estimates on future interest rates for the loan etc. but If you pump all the numbers into excel you can play with those unknown variables and get an idea of what sort of selling price you'd need to achieve for your investment to be profitable vs just chucking cash into a savings account and earning a near zero risk 5-6% interest.

Cheers