All Topics / Help Needed! / buy or sell?

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  • Profile photo of alwayscuriousalwayscurious
    Participant
    @alwayscurious
    Join Date: 2004
    Post Count: 80

    I tried posting this before – I don’t think it worked though.

    My situation is: I have 2 neg geared properties.
    a) 2 years old 3br dlug loan= 179K, rent = 225 (scheduled to go up to $230) After tax costs me $150 per month.

    b) 25 years old 2BR unit in gladstone, loan = $79K, rent = $135. Needs work. Costs $200 per month.

    I am thinking of painting and carpet to unit, and then sell?

    If anyone can give any pointers I’d appreciate it.

    Cheers alwayscurious

    Profile photo of theloanarrangertheloanarranger
    Member
    @theloanarranger
    Join Date: 2004
    Post Count: 47

    Hey alwayscurious,

    On face value I can’t understand how the 25 y/o unit is costing you $200 p/m (unless you’re paying way high interest..??) It should be creating + cash flow, in which case I would NOT be selling it.. Whether to renovate would be a decision based on if it would increase the rent, increase your deductions or to keep your tenant happy (or all three..)

    Are your figures re loan and rent correct?

    Cheers,

    Theloanarranger

    theloanarranger

    Profile photo of alwayscuriousalwayscurious
    Participant
    @alwayscurious
    Join Date: 2004
    Post Count: 80

    Thanks loanarranger.
    Here’s the breakdown of 2BR unit.

    Annual
    Loan repayments: 5676 (P&I at intro rate)
    Water : 100
    Rates 1300
    Maintenance : 500
    Body Corp : 1000
    Insurance : 200 (contents only, unit.)
    Let fee 148.5 (1 week + gst)


    Total costs 8924.5

    Income 50 wks@135 – 8.3% mgment fee
    6750


    Total -2174.5 per annum
    Per month -181.

    This is in my wife’s name and she does not earn a recognised income so there is minimal tax advantages.

    We made the mistake of beleiving the agent who convinced us that 150-160 per week on a 2br unit was reasonable. It may have been – however the market was flooded with rental units shortly after and still is. [angry2]

    Any ideas?

Viewing 3 posts - 1 through 3 (of 3 total)

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