Hi Peoples
]I’m new to this forum and need as much as advice/help as possible! Please![]I’ve read websites like this that say positive gearing is a better option than negative gearing. and vice versa.
I only know three people that have investment properties and they argue that negative gearing is “the way to go”.
I’m 23 live in Perth & paying off my home & car loan of $89K, this is really my first investment. My partner doesn’t want to get involved with r/e investing fullstop, so it’s up to me invest in a second investment property.
If it helps, after the mortgage and budgeting for bills, i have $140.00 left over after tax to spend on what ever i need/want.
I would really love to get into r/e investing,[
] but as soon as i see/hear something that says negative gearing is a fantastic option, i see/hear something that says positive gearing is better! argh![!] and vice versa.The main point that my friends argue/disapprove about positive gearing is that you must pay tax on the extra earnings from the rent. They would rather pay $20 extra to neg. gear and wait for the house appreciation (2-5 years)
Help help help please please please!![
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Perhaps I cld be someone’s protege?! or converse via email for experiences in investing and extra help??Sorry for the looooong email![
]
Thanx in advance!
JulianHowdy Praet!
First up, congratulations on getting that first (and soon second!) investment property all by yourself! Many would choose to use the less than %1,000,000 enthused spouse as a great excuse for a life of mediocrity, so you’re obviously willing to do things a bit differently for a better life.
Just out of interest, why are you investing in property? To make income or to lose it? If you’re paying more tax because you’ve increased your income wouldn’t this be a good thing? Did you know that there are ways to (legally) minimise taxes on your income? Most importantly, let me ask you this…
How many properties can you afford that cost you $250 a month? How many can you afford that *make* you $250 a month. How much of the value of either is based on criteria you can control?
All the best finding your answers to these and happy investing!
Feel free to come back and ask any questions that would help your decision. There are some fabulous, very knowledgable people here to help!
Quasimodo
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It seems to me that action has a most magic way of answering all the questions our fearful mind tries to throw before us…
__________________________________________________Thanx for replying Quasi! I noticed you answer alot of posts!
well i cld only afford another property,(for now)
but it wld only return probably an extra $30(australian) per week.i have taken into consideration management fees, strata fees, insurances, water and shire rates, and repairs…. i wld have to pay out extra from my pocket to pay for these[
!]Is that normal? Sorry for my ignorance, i am *very* new to this game[
]Few reasons why I want to get into r/e investing:
a) have a nice portfolio to retire early with
b) break the “Struggling Family Cycle” that i see my parents go through, and i don’t want to head down the same path.
c) obviously make money! []Quasi, be warned.. you may be answering alot of my posts in the very near future! hehe *lol*
Thanx!
JulianLOL! Happy to help however I can, although there’s many on this board more knowledgable than I!
Many of the fees you mention (water, shire rates, most repairs etc) are actually paid by your tennant buyer if you are doing wraps, helping your return (of both time and money) considerably! [
]
Others (such as strata fees and management fees) can be avoided in other ways. For example most tennant buyers usually dream of owning a *house* of their own, therefore no strata fees. Whilst not being free of work, the fact that wraps are typically tennanted by people with an owner mentality (as opposed to a transient renter mentality) who are resposible for *their* house should mean that management is vastly less. This could mean that you negotiate with a management company for a reduced service and fee, or that you take care of it yourself (either personally or by hiring someone). It seems that most people here use DIY management and so aren’t paying fees.As for insurance… sorry, you’ve stuck with thatone whichever way you go! [xx(] Still, it’s better than not having it! [
]As to why you want to invest, obviously you’ve got some great reasons. Now why do you want a nice portfolio? Income? Prestige? A tax break? (You’ll find why is and always has been my favourite word! [
] )b) Why do you want to break the cycle? Do you want to travel? Spend time with your family? Tell your boss he can take your job and… give it to someone else? [
] Knowing what you want will help you find the best path to get there.finally c) Why [
] do you want the money?Personally my game is to have our kids have full time parents who love what they do (when we have some! [
] ) and to have the freedom to share the best experiences that life has to offer (which to me includes seminars, adventures, visiting distant friends etc) with the people I love.As Steve puts it (loosely paraphrased) you need to be constantly asking, what’s moving me towards my goal and what’s moving me away. Sounds like good advice to me.
All the best
Quasimodo
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It seems to me that action has a most magic way of answering all the questions our fearful mind tries to throw before us…
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]I’m new to this forum and need as much as advice/help as possible! Please
]
!] and vice versa.
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] Knowing what you want will help you find the best path to get there.The topic ‘Dazed & Confused! Help!’ is closed to new replies.
