Hi!
I have finally saved enough (50k) to purchase my first investment property.
I would ideally love to have it as a positive cashflow property, I am also planning on paying it off aswell (tentant + me) to pay it off in now time.
The question I have is how do I find a positive cash flow property? any other information for a beginner would be greatly appreciated.
[biggrin]
best information I can suggest is to use the search function, read a lot of posts, buy some books and study them too, and don’t close your mind to the extent where it’s exclusively positive cashflow biased. There’s a lot of ways to skin a cat.
Thanks for the reply.
I have read a few titles.
Your investment property.
Dont Sign anything
Property Investors Handbook.However they do not really describe positive cash flow! can you suggest any?
I am just trying to learn about the different methods and uses, as I would like to have abit of heads up when it comes to my accountant ..
Generally an accountant will only tell you things if you ask, unless you have a real good accountant! and If you dont know you cannot ask
It will be my very first investment property @ age 24 and I would like to get as many things right as possible
check out the online shop on this site.
cheers
rHi Billy,
Suggest you have a look at the following thread – it discusses some ‘investment books’
https://www.propertyinvesting.com/forum/topic/6845.html
Not sure if Peter Spann’s books crack a mention, if not, would add them to the recommend list.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
+ve CF property means that the costs of holding are less than the income from the property.
Just a bunch of sums really.If you want a worksheet to fill in, get Steve’s product buyer beware, which are the ones I use – or at least used to use, before I figured out the quick way which is a yield of X percent or better is going to work for me if I sat down and did the numbers in detail long-form. or else you could buy some software i.e. REAP dolf de roos , or if you are that way inclined just use a spreadsheet.
The standard has traditionally been 10.4 percent, based on 80 percent LVR, breaking even. But with higher risk properties or the risk of interest rates going higher you might want to up that to 11, 12, or whatever you are comfortable with.
The next thing is where do you purchase a 12 percent +ve CF property in a growth area with nothing to do? well, they’re rare as hen’s teeth, even in NZ – and I look for them *all* the time.
The answer may be like in steve’s book # 2, ‘create’ a positive cashflow property. Books like Dolf de Roos 101 ways to increase the value of your property (works also for increasing rent too) or when he talks about ‘properties with a twist’ in his other books, for some specific ideas, cause there are many many ways – or else read Steve’s book # 2 because the MAPPers did it in a bunch of different ways too.
joy to the world
HI Mini good to see you on.
Cashflow is king because without the right cash you will be forced to sell when the market isnt favourable. For me to be happy I need to have the property earning 7.5% which currently pays the mortgage and management rates only and not the council/water rates and maintainance.
I usually do a reno in the first year so it means my maintainance is minor if any. So all Im up for is about $1200-1300 rates and body corp fees of $800 yr if a townhouse/unit. So by the general definition what I find or seek for others is 7.5% return or better.
Over time as rents rise this leads to better returns and true break even or better for thes, but in todays market you will be hard pressed to find anything near 7.5% in the major capitals.Happy hunting, and if you do look NZ, Minimogul gets em hot there so you really couldnt do better.
Good Luck
DD
Don’t sweat the small stuff,and it’s all small stuff!!
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