New Investor Questions Please Help.

Welcome to the forum.

Question one.
Depends on if you wish to develop property. As a new investor you may want to purchase property that has a large enough land component to do a future D/A application on. Recommend you read Unlimited Cash Flow by Craig Turnbull on development chapter. Some property's are sold as a possible future development site rather than having a d/a on them.
It is the land that goes up rather than the building.
Question two
The best deposit is what ever you can get away with. I have put down $1000 deposit and later paid ten percent as stated on the sales contract two weeks prior to settlement.
Where you may need more deposit is when the lender decides to only lend you 80% of the funds and you have to find the other 20% and also pay for the Stamp duty, legal fees and mortgage insurance. (you may be able to borrow more funds to cover these charges depending on your money (deposit) and the lender requirements.
Question three.
You will be able to claim the interest charged on $315,000 left on the loan. You can also claim over five years the borrowing costs to set up the loan, Council Rates, Insurance (Landlords insurance), Water Rates, Repairs, Depreciation of fittings / improvements (use a Quantity surveyor) and Depreciation of building if it is a new building but it adds to cost base for CGT.
How much, well a 315,000 loan would be at say 8.5% interest rate = $26775.
So $400 rent a week = $20,800
council rates and water rates and insurance say a guess of costs at $2000
So income = rent – expenses
income = 20,800 – 2000 – 26775
income = minus 7975 this is why it is called negative gearing
Depending on your wage . for an example say you earn $85,000 your tax would be worked out as follows
0 -6000 = nil (2007/08 tax rates see http://www.ato.gov.au/individuals/content.asp?doc=/Content/12333.htm)
$6001 – 30,000 =$4200
30,001 – 75000 = $18000
75,000 – 85,000 = 40% = $4000
so tax is 26200 not taking medicare into account
so you take the minus 7975 off from your $85000 taxable income and bring it down to $77025
so 2025 * .40 = $810 tax so you get $4000 – $810 = $3190
or you could have taken the $7975 * .40 = $3190 only because it falls in the 40% tax bracket.
in 2008 tax year if you earn say $70,000 your marginal rate is 30% so you get back
7975 * .30 = $2392
So it really depends on your marginal tax rate as to what you will get back for the tax you already paid while you paid tax while you earned a wage each week.
Question four
Depends on if the 800k is cash or borrowed funds. Depends on what you decide your strategy is.
Do you think property will gain enough capital growth to offset the huge borrowing costs of small deposits as you are losing 60% to get 40% back. Also you will also run out of borrowing capacity as your LVR grows higher and you have a limited earning power from your job. Serviceability will also be a problem as the debt level grows.
If you take a positive cash flow strategy you have fewer properties but each property could be costing you zero or making you money. You get less leverage but you can have a reasonable lifestyle or pay more off the properties debt because the properties either cost nothing or make you cash money each week. drawback you pay income tax unless you structure the ownership into a company at 30% tax.

Read as many books as possible as it is a cheaper way to gain knowledge on what you can do. See
http://www.businessmall.com.au/store/listCategoriesAndProducts.shop?idCategory=9