Dear All,
i need some help to crunch some numbers. Here’s my situation:
Own PPOR worth 650-700K
Owe 440K
Salary (one income) 120K
Liabilities: 3 kids!
No other debts or assets or cash
My poor husband is working his butt off and seeing his income whittled by tax every month. Is there a way out?? Can we afford another property?
Ever hopeful and
Thanks!lee
I have you down for around the $200,000 mark without additional rental income assuming no credit card, a worst case scenario with high living expenses and not allowing for the tax break coming very soon.
This goes up to around the $250,000 assuming only a minimal rental income of $150 per week from purchasing an investment property.
Robert Bou-Hamdan
Mortgage AdviserThanks for the quick reply Robert, it was very encouraging to me.
However won’t your numbers put me in very negatively geared territory? (and thus eat up my cash flows?)
Am no accountant but could you or someone else care to give me a breakdown of repayments and upfront deposits required?
Thanks a lot
lee
No deposit or other upfront funds would be required if you use your existing equity.
As for repayments…
$440,000 existing loan = about $2,845 per month P&I
$250,000 new loan = about $1,617 per month P&I
$250,000 new loan = about $1,400 per month Interest OnlyAssuming a low rental return of $150 per week ($650 per month) which does not allow for ongoing property expenses, insurance, tax deductibility etc, you would be in a negative position. If you want a positive position, you will need to find a positively geared investment property (or more than one if you buy cheaper properties and diversify the risk of vacancy).
Robert Bou-Hamdan
Mortgage Adviser
You must be logged in to reply to this topic. If you don't have an account, you can register here.
