Hello
My name is Michael and I was wondering whether someone more experienced than I could please help me with the below questions ?
I would like to know how to calculate whether a property is cf +. I have used Steves calculator provided as a guide and would like to know whether there are any more variables to take into consideration other than the ones mentioned ?
Using the calculator, on a $120,000 loan it seems I would have to be charging around $270 p/w for the investment to be cf +, taking into account the recommended 5% for repair and managemnt and the $1000 p.a. for rates + vacant weeks per anum. Is this right ? Am I allowing too much. This weekly rental seems unreasonable given the quality of dwelling the 120,000 could afford. ?
Does Steve have a book that details these sorts of number crunching issues ??
Thanks and Regards
Michael
M.Johnston
welcome to the forum michael.
it all depends on a lot of variables when ‘crunching the numbers’.
what you need to take into account is what you would determine the estimated yearly costs for owning/managing any specific property are going to be, by investigating through various sources: R/estate agents, government, local rental markets etc. then you need to determine what would be a ‘realistic’ rent value for any specific property in a specific area, and calculate the difference.
if there is $ left over after all costs & income has been estimated, then the property MAY be CF+ (if it is rented out within your calculations and guidelines it may be CF+, but it WONT be CF+ if it is NOT rented out because the rent value you have set is too un realistic).
remember: CF+ properties are rarely bought, they are created through finding a ‘problem’ and providing a ‘solution’.
you just need to look outside the square.
It is only your thoughts that create your future – Be careful what you think!
Hello Michael,
I know how confusing this all is so if you click on shop online on the left of your screen, Steve has available a program called ‘Investment Detective” which calculates all this for you.
I hope this has helped.
Kind Regards PaulaJohn and Paula
“OR”
click on the link below my post and check out Jaffasofts calculators.
[specool]
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow Calculatorlike redwing, i would also recommend the jaffasoft website. very useful.
eric
I’ll back up the Jaffasoft recommendation it is very hepful also another you can try is http://www.yourmortgage.com.au go to calculators and then to link, can I afford an investment property.
Goodluck.collie
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