Hi everyone,
I’m 20 years old and new to the world of property investing.
I anticipate that i will have about 30K by the time I am 22, enough hopefully for a deposit..
Just wanted to know, what is the best way to go about getting a positive cashflow property?
Apologies if this seems like a dumb question, but I am currently under the impression that the best way is to get a property whereby
I can fork out more myself, so that my monthly repayment is less than the rent income received.Is this or am i missing something?
Cheers.
Hi there,
Forking out a large sum of money might get you 1 positive cash flow property, but if you use all your cash on the first deposit, it will take you another 2 years to save for another.
The trick is to use as little amount of cash possible to reach an income/expense level that you are happy with. This might mean that the property is +ve cash flow, or it might not.
If you are only going to be happy with an income equal to or higher than your expenses, then you need to consider a few possible strategies… many of them are discussed daily on this site, and include buy and renovate, vendor finance, developments etc…
In the current market it is quite difficult to find a house/unit that you can simply purchase with a low deposit, and have as positive cash flow from day one. Another difficulty is that this might not even get you the highest overall return possible when you do find it!!
Long story short, positive cash flow is more about MAKING deals than it is about FINDING them. If you fully understand the theory behind that ideal, then the light at the end of the tunnel will be that little bit closer.
I hope this makes sense, but if not, please feel free to ask more questions.
Regards,
Steve (YI)“Knowledge is Power”
Finding positive cashflow is very difficult in this current market. One other area to consider is building writeoff as a way of creating extra cash flow at the expense of reducing your cost base = more capital gains tax. building improvements can push a house into positive territory. Steve Mcknight also mentions in his book about being a fixer of problems as a way of creating a positve cash flow.
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