I'm lost/stuck with the current market situation and struggles to plan forward, while getting sick of the waiting game so I'd like to hear any suggestion or option that I could've missed on planning towards my goal given my current situation.
Financial status:
AUD $75k in savings acct.
RM $400k in Ringgit, exchanged at $2.9 rate when i sold my property here & relocate there years ago.
Salary AUD $70k pa.
I'm now in Brisbane and would like to get a house by end of the year & plan for future but can't get my head around below,
1) Current exchange rate is RM3.40 to a dollar which tells me now isn't the right time to change.
But AUD won't drop unless credit crisis unfolds / bubble bursts / recession hits & bank has no choice but to lower interest rates + print more AUD. (All of these seem unlikely to happen anytime soon ? )
And, RM is not looking good either plagued with the troubled political issue & monetary policy, coupled with slump in oil prices altogether making it worthless thus no chance for it to rise against AUD anytime soon ?
I'd have to bite the bullet if I'm wanting to get a house, even if the exchange rate ain't getting any better by end of the year ?
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2) I'm after a house nearby inner-city, be it a very old rotten 2 bedder house in Gabba that ranged $650k+ is fine with me. But then reality struck and questions myself all over again.
Am i over-stretching on getting $600k+ property based on my current financial status ?
I'd say I live frugally and able to save big portion of my income easily since I don't have a family yet, aka single atm. I target to hit over AUD $100k in savings before end of the year.
I've no problem to service a $400k loan even if rate risen up to 8% , but then I haven't taken into account of anything worst than that or recession hits/lost job, etc. I'd be doomed. (Possible for a 25yrs recession free economy ? )
Should i play safe & settle for less - go for apartment or look a few suburbs farther away with a lower house price ?
But then i'm pretty sure i'd get kicked out from the market & won't be able get my hands on nearby inner-city house in the future as there won't be any land/house left to buy except ones that cost few millions or only apartments are left.
I'd also like to hear from people that thinks it's better to just get a $350k apartment with tiny loans and pay it off real quick, live in it forever, be stress free, mortgage free, reach FI/RE & enjoy.
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3) Or should i just sit back & play the waiting game, see what the apartments glut in Brisbane has to bring on the market and the quantum of impact it'd have on the economy outlook. (Probably nothing happens if immigration loosens, rental demand risen, restrictions on foreign investment & loans lifted, investors back on the market, life goes on as usual.)
Afterall, the general advice seems to be .. don't time the market and any time is the right time to buy a house to live in yourself and call it a home as long as you're not overstretching.
Any advice/opinion would be appreciated. Thank you.
Here is my advice for the RM400K that sit idling, i believe in malaysia FD or savings account. If you are a malaysian citizen, try to invest in unit trust from ASNB, a national unit trust scheme. Pick those with fixed price (capital protected) like ASW2020, ASM and AS1M which give average 6% taxfree dividend per annum. You can sell them anytime when you have decided to commit to a property in Brisbane. In near time, there is no way ringgit will return to below $3 rate, so put your money to work harder for you