All Topics / Help Needed! / IP Scenario – Comments / Views / Opinion please

Viewing 5 posts - 1 through 5 (of 5 total)
  • Profile photo of Van DemonVan Demon
    Member
    @van-demon
    Join Date: 2005
    Post Count: 3
    September 7, 2005 - 1:40 pm

    New House to be built – Inner Inner City Brisbane

    Do my figures add up??

    Land Value 450K (owned)
    House Construction Cost 750K (to be borrowed)

    Rent Gross ($800 /wk) = $41.6K

    Costs:
    Interest (8%) = 60K p/a
    Agent Commission (8%) = 3300
    Rates = $1500
    Insurance = $800
    Pool Maintenance = $1500
    Depreciation Year 1 = $24K (Ballpark – am I way off here?)
    Bank Fees / Sundries = $1200

    Total Costs = 92K
    Income less Costs = 50K LOSS

    Investors Personal Income = 120K / Tax = 40K
    Investors Adj. Personal Income = 70K / Tax = 17.5K
    tf. Tax Adjustment of 22.5K

    So Cash Flow is:

    Rent 41600
    + Tax Credit 22450
    – Cash Outgoings 68330 (no depreciation included here)
    = total annual cost of $4300 approx or $80 /wk

    This doesnt quite seem to add up to me – or does it?

    Profile photo of clonesclones
    Participant
    @clones
    Join Date: 2005
    Post Count: 81
    September 8, 2005 - 3:17 am

    Hi Van Demon,

    I guess we need more explanation.

    OK – Land Value 450K (owned)
    OK – House Construction Cost 750K (to be borrowed)

    OK – Rent Gross ($800 /wk) = $41.6K

    Costs:
    Interest (8%) = 60K p/a
    How many years are you going to get the loan for?
    If it is 30y = 66,048 p/a

    OK – Agent Commission (8%) = 3300
    OK – Rates = $1500
    OK – Insurance = $800
    OK – Pool Maintenance = $1500
    I guess OK – Depreciation Year 1 = $24K (Ballpark – am I way off here?)
    OK – Bank Fees / Sundries = $1200

    Any Land TAX?

    Total Costs = 98K
    Income less Costs = 56748K LOSS

    Can you recalculate this again with the new values:

    Investors Personal Income = 120K / Tax = 40K
    Investors Adj. Personal Income = 70K / Tax = 17.5K
    tf. Tax Adjustment of 22.5K

    Rent 41600
    + Tax Credit 22450
    – Cash Outgoings 68330 (no depreciation included here)
    = total annual cost of $4300 approx or $80 /wk

    Profile photo of Van DemonVan Demon
    Member
    @van-demon
    Join Date: 2005
    Post Count: 3
    September 8, 2005 - 4:04 am

    Thanks for the reply clones.

    *I am working on IO loan – no principal payments.

    *Property does not attract land tax at 450K in Queensland

    I don’t think that changes any of the values – did you want more information to offer further comment?

    Thanks. VanDemon.

    Profile photo of Alistair PerryAlistair Perry
    Participant
    @aperry
    Join Date: 2004
    Post Count: 891
    September 8, 2005 - 4:53 am

    You should be able to do a lot better than 8% on the construction, which would change the net income figure quite a bit.

    Regards
    Alistair

    Profile photo of Van DemonVan Demon
    Member
    @van-demon
    Join Date: 2005
    Post Count: 3
    September 8, 2005 - 5:24 am

    Thanks APerry– I am trying to work out ballpark depreciation rates but the data is hard to come by. Hav already noted the depreciator.com.au website however.

Viewing 5 posts - 1 through 5 (of 5 total)

You must be logged in to reply to this topic. If you don't have an account, you can register here.