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  1. #1
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    Default Buying land to sit on. Already have mortgage

    Im so confused by how people manage to buy investment properties. For example my brother has 3 investment properties and earns what me and dh do so howww.

    Where do I start? We found land we love and have emailed the bank to get a loan for that amount.. ontop of our mortgage which I dont see how they would say yes but buying more than one property has to be possible if brother does it. I asked him how and he said about having renters to pay most of mortgage. . We wont have that as its just land.. augh just really want this great land!!

    Has anyone done this and have advise for us? Thanks

  2. #2
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    We have just done this. Bought a 10acre block to use in 5 or so years which we will build on. Our plan is to sell our current house to finance the new house on the block though. So I guess not really an investment in the long term.
    We were surprised the bank said yes but they did.
    No harm in applying, they can only au no.

  3. #3
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    Oh so happy to hear that lisaandshaun.. its exactly what we will do when time to build on new block.. sell what we have to finance the house part.
    Can I ask what loan you got? As in did u just add the land to your current mortgage or get a completely seperate loan?
    Thanks

  4. #4
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    We weren't allowed to just add to our current house loan, so we took out another house loan for the block. We were thinking about putting a transportable house on the block but banks won't finance something that can be removed.
    If it helps both our loans are with commonwealth bank.

  5. #5
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    Ok thanks.. I dont know how we would afford another loan but it has to be possible...
    Will wait and see what reply bank has. Fingers crossed im so in love with the block!

  6. #6
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    It is possible. We bought our first property over 12 years ago in a suburb that wasn't desirable but it's what we could afford. We renovated it then rented it out while we travelled north with dh's work in which we were supplied a house at minimal rent for 3 years. We bought a large vacant block of land during this time and 2 years later bought another house and rented it for $1,000 week. We then moved into our own first home after the 3 years. By this time the suburb had increased in value greatly, we eventually sold it for 6 times the amount we paid for it and because we lived in for a majority of the time we didn't have to pay capital gains. We then bought another house which is rented at $1,000 per week. We will move into the second house we bought and still live in and again won't have to pay capital gains because of the amount of time we have lived in it, our renovations also mean the value has increased greatly. once we move into our dream home which is the third home we bought we will sell this home. We have our block of land for sale currently which is now subdividable so it will sell for 5 times what we paid for it. We won't be buying any more properties, it's time to keep some money in the bank instead of having it tied up in properties. If you buy in the right suburb and can get good rent and then the value of the property goes up and you sell at the right time, that's how you do it. We haven't always earned a high income either.

  7. #7
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    Wow kimberleygirl thats amazing I wish that was me! I feel like the boom has happened so I dont know where I would buy up. Im waiting on bank to get back to me now so my hopes are still high at the moment reading your stories.

  8. #8
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    Quote Originally Posted by pisang View Post
    Wow kimberleygirl thats amazing I wish that was me! I feel like the boom has happened so I dont know where I would buy up. Im waiting on bank to get back to me now so my hopes are still high at the moment reading your stories.
    I recommend talking to a finance broker. He will explore your options with lenders once he has looked at your finance situation. We have always gone through the same broker we have dealt with for years. There are also seminars you can go through re how to build a portfolio. There are companies out there that specialise in building portfolios too, they look at your finances and suggest where you can buy and how much you can spend as they have specific areas in every state, they have watched the market over many years so know where good suburbs to buy are.

    Also, while some banks don't like to lend for purchase of transportables but there are some who do! We looked at this option for our block last year and there were a few lenders that would lend for a transportable. We changed our mind when we found out the area was being re zoned.


 

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