I am new to this forum.
In fact I am new to property investing. I have been looking around for 2 months and finally found one cash flow positive property. In fact it met Steve 11 sec solution. [thumbsupanim]
This property is in Sydney and hence its rare.
The property is in a block of ugly building which has no capital growth potential. The rental yield is good and give positive cash flow.
I am wondering if it is a good investment. I don’t have much money for future investment if I invest in this and if this does not have capitall growth potential I would not be able to utilise its equity for next investment. [confused2]
Am I thinking right? Need some advice. [worried]
You say the property has no CG potential. I find this hard to believe. My experience is that some properties just lag behind others.
The other point is, that I do not believe that the market will move dramatically in the next few years anyhow. So you will be much better off with a cf+ property where the rents will slowly go up, than a cf- property that may grow slightly quicker.
Your positive cashflow will allow you to save up for the next deposit.
Go for it and good luck
But remember to do good diligence (eg building inspection, etc) so that the property stays an asset and does not become a liability.
agree entirely B.B
No one ever went broke making a profit.
Pos cashflow will eventually allow you to become financially free.
Cap growth will too – when you sell, but you’ve gotta be able to service the debt in the meantime; you are chained to your I.P.Cheers,
Marc.
[email protected]“we get sent lemons; it’s up to us to make lemonade”
Hi marky88,
I guess the decision on buying this property on not depends on your investing goals. If you are seeking cash flow then capital growth should be a secondary consideration. Any capital growth you get should be considered as a bonus. I agree with bridgebuff that some properties just lag behind others but in the long run all properties experience capital growth.
Regards
Sanjiv“There is no passion to be found playing small – in settling for a life that is less than the one you are capable of living.†– Nelson Mandela
Hey guys…Thank you for da positive feedbacks.
I have read Steve’s book from back to back and I kinda knew da answer at da back of my mind. Due to this is my first time and i couldn believe this deal exists in Sydney.
This really affirm my decision to go ahead.
Thanks once again for da encouragement.
[strum]
Yo! wattup bruvva?
I tink da word ‘the’ is spelt – T.H.E.
know wud um sain?
[grrr]Cheers,
Marc.
[email protected]“we get sent lemons; it’s up to us to make lemonade”
You may not go broke making a profit, but you may be able to do a lot better.
This is not a small unit is it?
If there is no CG potential, then I cannot see the point in buying such a property. making $50 (eg.) per week for 100 years may not be worth the effort. Think about the effect a rate rise or a major repair will have. Also think of the opportunity cost – what could you have done with your money instead. Also what about your borrowing capacity being used up too.
Terryw
Discover Home Loans
[email protected]
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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