All Topics / Help Needed! / Got a cold feet

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  • Profile photo of DDDD
    Member
    @dd
    Join Date: 2004
    Post Count: 508
    August 17, 2005 - 12:25 pm

    The first dozen IP’s are always the hardest…only 11 to go!!!!

    Good work girl, knowledge is king, but so is cashflow. Hope it all goes well.

    DD

    Buyers Agent (Dip Financial Services(FP)
    Don’t sweat the small stuff,and it’s all small stuff!!

    Profile photo of YasminaYasmina
    Member
    @yasmina
    Join Date: 2005
    Post Count: 60
    August 20, 2005 - 6:29 am

    Thanks everybody for encouragement and support, will have a little break from property searching and than move to another one. Kind regards to you all.

    Yasmina

    Profile photo of clonesclones
    Participant
    @clones
    Join Date: 2005
    Post Count: 81
    August 20, 2005 - 8:41 am

    Hi Yasmina,

    I am just running a couple of IP test on properties people buy, just for reference.

    IP = $190,000
    You put $19,000 from your pocket (Assumed)
    Loan = $171,000 for 30 years 6% interest
    Rent received after commision =
    $230p/w x 52weeks= $11,960 – $2500 (costs) = $9460
    Loan Repayments = $1,026/m x 12months = $12312

    Let’s assume you are in the 47% tax bracket.

    As you receive rent, you have to pay tax for it =
    $9460 x 0.47 = $4446.2

    And you have a tax deduction for your repayments=
    $12312 x 0.47 = $5786.64

    Totals = $9460+ $5786.64 – $12312- $4446.2=
    -$1511.56

    Now, QLD are going up 1% or 2% that means = $190000 x 1.01 = $191900 which means $1900 profit and you are paying -$1511.56, so you end up getting $389 per year for $19,000. (2.05% return/year)

    A low return, but it is generating some positive cash flow. Keep an eye on your repayments as you will pay more every month than what you will receive and will only catch up every year with your tax return.

    These are just my thoughts, no recommendation or advice. Do your own calculations.

    WBII

    Profile photo of YasminaYasmina
    Member
    @yasmina
    Join Date: 2005
    Post Count: 60
    August 20, 2005 - 11:25 am

    Hello clones,

    hell of a calculations, i wouldn’t do it better myself, if i need any logical or mathematical help i know where my next knock on the door is going to be. It is my first baby, hopefully will be better next time.
    Cheers.
    Yasmina

    Profile photo of Cornwillco20463Cornwillco20463
    Participant
    @cornwillco20463
    Join Date: 2003
    Post Count: 11
    August 20, 2005 - 12:06 pm

    Hi Yasmina
    Just a different spin on clones figures.
    ip $190000
    $19000 deposit
    loan 171000 for 30 years x 6% IO
    Rent received after costs 9460
    Loan repayments 10260
    800 loss
    no tax payable
    deduct $800 loss from other taxable income
    800×47% tax rate=$376 saving
    now the loss is $424
    $8.15 a week neg geared
    Property goes up $1900 yr
    so now is +$1476 yr
    hope this makes sense
    regards Bill

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