Best Way Out of a Bad Situation? Guidance please.

[lamborgini]

Thanks Gary.

[grip]

Curent situation : 1 property in Flatbush owing 520k and equity 80k (as per recent valuation) where we live at the moment.
Debt : 40k (loss from an IP outside of Auckland) + 10k (Other)
Aim : To buy and hold IP's & achieve financial freedom in 3 - 5 years (hope it's realistic).

To all experts : Please suggest some ways to do get to my goal.

1) find a flat mate ASAP. This is tax free subsidy and will bring you into cashflow positive.
Renting out Flatbush then renting another house separately may not be as great, but you need to do the numbers.
2) save hard. You should be able to wipe off the Tokoroa debt and save a deposit for your IP within a year given your joint income of 173k pa.
read http://www.mrmoneymustache.com/ on how to do this quickly.
3) do more research, read books, join APIA in meantime. Be an area expert.
4) work out how much you can borrow by talking to a mortgage broker.

I imagine you should be in a position to buy an IP over the Xmas hols, when you might actually find a bargain.
From where you are now, 3-5 years to financial freedom is completely unrealistic. I am unsure why the others haven't pointed this out.

[lamborgini]

Thanks So much Grip - i guess moving is working for us as we work in city. renting a 2 beddie will also save some money - finding flatmate is easy but finding a reliable flatmate is the problem. not everyone like to live in a family type setting if you know what i mean and with a 3 year old kid.
In the meanwhile i am joining APIA this week. Thanks for the website bud.
Great advice.

So according to you 3-5 is unrealistic ? what is realistic and why do you think that mate ?

[speights boy]

So according to you 3-5 is unrealistic ? what is realistic and why do you think that mate ?

Probably because it is such a nebulous phrase; and means different things to different people.

For example, do you mean the ability to choose what you wish to do and when to do it, without the constraint of money being a factor ?
If so, then it all depends on what the net income is that you desire from your investments.

[elguapo]

So according to you 3-5 is unrealistic ? what is realistic and why do you think that mate ?

Add the numbers up. How much can you save for investment in 5 years. How much property (or other investment) does that then buy and then work out what the actual return on that will be.

Financial freedom, (IMO) means that you have enough income from investments to make work not required to support your lifestyle.

[BigDreamer]

Financial freedom, (IMO) means that you have enough income from investments to make work not required to support your lifestyle.

Agreed and that takes time and smart investment. Going by capital gain only properties are risky (but could be very profitable) while buying cashflow properties only are a 'safer' choice but have their own challenges.

[PTILoveYou]

Yeah right now it is really hard to get cashflow properties in areas where there's capital growth.

But going by capital gain only properties is still better than sitting on the sidelines, not buying, and waiting for the stars to align... again...

[lamborgini]

what capital gain areas are there out south besides Flatbush, Dannemora, pakuranga, mellons bay but they are all EAST as oppose to south. Goodwood heights ?

[PTILoveYou]

I think you can find some statistics from REAA or realestate.co.nz about certain suburbs not sure.

That would be a good way to find out.

I'm not an expert in east nor south area, so I'm not going to comment which area is better for capital gain.