July 11, 2022

#161: Property Planning Case Study #4 - Do we buy in the capital city or regional centre (we plan to live in both), before or after we have

40 minutes

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: Market update 1. Investors making a come back Cate discusses the return of the investor. Enticed by less competition, higher rental returns, tight vacancies and longer tenures, investors are coming back into the market and taking advantage of the opportunities. 2. RBA lifts rates Dave shares with our listeners that once again the RBA has lifted the cash rate by 50 basis point to a target of 1.35%. This will flow through to the lending market variable rates. Many economists are tipping that the cash rate could climb to as high as 2.0% or possibly more. The move is largely to tackle the current inflationary environment, with inflation forecast to peak later this year and then decline back towards the 2-2% range in 2023. 3. Understanding vendor motivation Cate shares some hot tips for prospective purchasers on whether you should put in a pre-auction offer and why entry level family homes are still going strong despite the softening market conditions. 4. Adelaide is at the top of the charts over the financial year Pete shares some exciting news for his home town Adelaide which has snuck into the top position over the last financial year with 25.7% annual growth over Brisbane's 25.6% annual growth. Can Adelaide do it again over the calendar year? Interestingly, Brisbane may overtake Melbourne in median house price. Watch this space! Case study #4 1. The conundrum This case study follows the journey of Jason and Amy, who wanted assistance deciding whether they should purchase a home or investment, before or after they have kids, how their cash flow would change as they start their family, what cash savings buffers they should have in place, and how much they should spend and which location. 2. Introducing Jason and Amy David shares Jason and Amy's key circumstances and of course, their lifestyle and property goals which are driving their decision. Jason and Amy are a couple in their early 30's, yet to start a family, living in one of Australia's major capital cities. Their long-term plan was to continue living in a capital city, but thought they may move to a regional area in the short-term to be close to family and have some additional support as they start having children. 3. Starting a family with your eyes wide open The trio discuss the importance of understanding (and being comfortable) with the impact that starting a family will have on your cash flow. This could be the difference between holding on to a property and panic selling when savings start to go backwards. 4. Modelling the scenarios Two scenarios were modelled for Jason and Amy, one to purchase their home now for $1.1M or an investment that could become the long-term home for $1.5M. The trio discuss the pros and cons of each scenario. 5. So, what did they choose to do (and what was the compromise)? Tune in to find out which scenario Jason and Amy went for. Were they successful and what was the compromise? 6. The risks of rent-vesting The trio discuss the dangers of rent-vesting when the desire to get into the long-term family home takes over and some clever ways to work around this proactively. Visit the show notes - https://propertyplanning.com.au/property-planning-case-study-4-do-we-buy-in-the-capital-city-or-region...

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