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FIRST HOME INVESTOR NETS HIGHER GROWTH

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planning permit | 14 Jun 2015, 09:22 AM Agree 0
Recent reports show there is a growing trend in young persons taking out an investment loan rather than the straight out first home loan. There is an advantage for these astute young persons on good incomes. If one buys a home with subdivision capabilities it generates capital growth faster if the right property is acquired.

These persons either stay at home or rent while their investment first home rental pays towards their mortgage. Sure there are capital gains tax implications but the First Home Investor's intention is to build wealth and a property portfolio faster than buying a new first home in a outer suburb which appreciate at a slower rate.

The key to accelerating the growth is buying properties capable of future development- like a potential dual occupancy site in an established area. The house may be run down and not be as flashy as a new first home in an outer suburb, but these homes still rent. A town planning Application for a dual occupancy is lodged soon after the purchase and a town planning permit is valid for two to four years usually. In that time the property value with the planning and subdivision permit should increase providing equity for a construction loan. Lenders feel secure as the existing home is retained and in the event of a fire sale the lender is protected.

Dual Occupancy are high yielding, purpose built investment property options in the Melbourne area that may allow the creation of two separate titles at a future date, allowing significant capital appreciation once the new titles are created. These properties have a high rental yield. The creation of future strata titles is always subject to the various councils planning regulations at the time of the application.

If you already own a home or property and it has increased in value you could use that equity to purchase your first investment property. As the equity grows in this first investment, it can then be used to purchase a further property. These are the first steps to building your investment portfolio.
  • nova | 19 Jun 2015, 07:58 AM Agree 0
    I found this post interesting. I am part of a team of Real Estate ,I just started to sale some projects (house and land packages )
    Do you have any suggestions? How to find good investors ...
    Thanks
    • Planningpermit | 19 Jun 2015, 08:54 PM Agree 0
      Hi Nova which city are you in.
  • nova | 19 Jun 2015, 07:59 AM Agree 0
    I found this post interesting. I am part of a team of Real Estate ,I just started to sale some projects (house and land packages )
    Do you have any suggestions? How to find good investors ...
    Thanks
  • dreamzz | 20 Jul 2016, 05:05 PM Agree 0
    please contact me, i am a new invester looking to buy a block of land in north of melbourne and subdivide, we dont have much idea about the process, any help would be really appreciate. Cheers
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