Brad,

Post tax +ve cashflow by ” a narrow margin ” is great if the desired outcome is buy and hold for capital gain. But what Steve is all about is producing income via positive cashflow not waiting for your tax cheque to bring you in front.
Personally I think there is a lot of merit in the type of investment you mentioned because your +ve cash…[Read more]

Brad,

I think what that is called is a “rort” (spellchecker).

MJK

When assessing capital gain depreciation ( chattels ) is taken into account as profit but building allowance ( 2.5% of building cost ) is not.

MJK

It may be a bit difficult if the Spouse owns half the property. Wouldn’t you have to split the rent for Tax purposes.

MJK

One of the main reasons investors fail is because they sell too early. Believe me I know.

MJK

The market is HOT HOT HOT but if its capital gains your after you need to find an area thats in the early stages of growth. I suspect not Melbourne or Sydney. It may be better to wait if your a believer in the hypothetical Crash ” we have to have”

MJK

Powderfinger,

We can now call you a “Buyers Agent” can’t we.

MJK

When the prices get too high for mums and dads and first home buyers in Melb and Sydney the interstate migration to Brisbane begins. So Brissy may be more insulated to hypothetical downturn than Melb and Sydney.

MJK

I would have to say that Fitzgeralds’ book “7 steps to wealth” is a must read.

MJK

The Australian economy is significantly different know than it was in 1988-1990.
Today interest rates are 6% compared with 17%.
The economy is strong against the rest of the world not weak.
USA is emerging from mild rescession not going into one.
COOL yes ! Crash no I don’t think so.
There is no rescession being factored into the Australian…[Read more]

Actually, I’ve had agents suggesting rental increases on my Brisbane properties. But buying in those markets now would be a seriously negative cash flow proposition.
Personally I believe that capital growth and rental growth are counter cyclical to each other on the whole. It when the building of new properties slows down that the rents rise,any…[Read more]

There is another major difference that most residential investors fail to realise initially ( including myself ) and that is that interest rates ar higher on commercial loans. Typically 1% higher.
You usually can only borrow 70% although savvy clients with a good track record possibly could do better.The interest rate offered is often linked to…[Read more]

A question from an absolute shares novice. If one had considerable funds available from a LOC at 5.97% they would be able to invest directly into shares without margin lending wouldn’t they. That is they are secured by property.
If so, could they invest through dealforfree without using margin call or would they be better off using another access…[Read more]

The ATO ruling is that you can only claim interest from the time the property is available for rent. Any interest you pay while building is counted as part of capital ( purchase price ) and is taken into account when you sell. In other words it becomes part of your capital gains tax assessment so you can show a smaller gain.
Probably not the…[Read more]

Kezza,

Your rents look pretty healthy. 200 per week for a one bedder is good. Was looking at a Melb one bedder getting only 150. I dont think your units will ever be 11 second rule properties because they are within 15-10klm radius of Brisbane so what you will be achieving is good capital growth at the moment.
I think if four agents are telling…[Read more]

I suppose when it comes to units there’s always another one around the corner so competition for tennants could be stronger. I wasn’t aware that there was a problem with vacancies in Brisbane area. I own a few houses in Brisbane and have never had any real trouble finding a tennant, bearing in mind that the houses were purchased between $130,000…[Read more]

I like to raise the rent buy $5.00 per year. 5 Bucks never killed anybody but it helps to keep rents up to date.If a tennant is on a 6 month lease I raise it on the second renewal. If they are on a 12 mth lease I raise it every renewal.But you must be surte you are not too pricy. Generally most investors dont increase when they should. And your…[Read more]

I think what Crashy means is that the interest on a home loan is dead money and that it is. Perhaps at the moment if rent is cheaper than your interest bill you could save some money. Put this extra cash aside as a bigger deposit and buy your house when the market corrects. The problem you face is that if it doesn’t correct you would have been…[Read more]

You can use your equity as a deposit. The Bank will evatuate how much equity you actually have and allow you to borrow against it. You need to speak to your banker/broker to get an idea of how much they will lend.We can’t tell you how much, only that you should be able.

MJK

For QLD I have found Advanced Depreciation Services excellent. 07 3889 1552

MJK