I’m just trying to play around with the calculator , if the result are negative around 1% is it still worth to pursue?
By the way, did anyone has invest in regional Townsville QLD?
Please help…….[cowboy2]Johan,
Welcome, noticed it was your first post so thought I’d pitch in with some help…
The question of whether it is still worth pursuing if it is slightly -ve is one of your investment strategy. If you envisage positive CG then a slightly -ve cash flow should be offset by CG and still deliver a positive return. Not everyone is into negative gearing though, and if this is the case for youruself then you’ll need to look elsewhere for your +ve CF. They are out there.
I personally prefer a slightly -ve geared / neutral portfolio because I look to make my gains in the big smoke over the mid/long term where CG is solid.
If you want some specific answers on the property you’re looking at then post some details and I’m sure a nice person on this forum will post some constructive feedback on the merits of your specific opportunity.
Cheers,
Michael.PS, Nope haven’t invested in Townsville.
If you can afford it and usually you can raise rents in a yr. or so to make it CF+, but of course it depends (the levels of rnetals, vacancy, etc).
Rgds.
Lucifer_auI personally would see that as an opportunity that could be changed in a relatively short period of time. All that property (assuming all calculations are correct) would need is a lump sum payment at some stage in the next few months (Tax return?) and maybe a slight rental increase if it allows for it.
Another option to increase rent is to include something people are willing to pay for. For example, My REA said some people are willing to pay $15-20 more a week in rent if a house has a dishwasher! ROCK ON!!
Keep crunching the figures. If you want to make it work, it will.
Steph.
Success is 1% inspiration and 99% perspiration.
I am surprised at the talk about negative gearing – I thought that this ‘religion’ was all about positive! I’ve just read through 15 or so chains and cannot find anyone actually finding positive cash flow on investements. Has the thinking this changed that radically?
PropertyQueen due to the current boom it is now a lot harder to find CF+ property (though I’m still buying them). If you read Steve’s second book there is now more emphasis on finding twists to the property which will enable you to create a CF+ situation.
As for being negative, on this case if it is say less than $1 a week, I would say go for it as one day I’m sure you will be able to put it up $2 per week, and hence make a CF+ deal.
To me if a property is netural (or even a tiny bit negative) it isn’t too bad, as long as you know you can support it. Also for many it’s a way of entering the market without waiting for ever.Rgds.
Lucifer_auThank you for the positive response, I’ll investigate further the area before buying the property.
Thank’s guys
[blush2]
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