how is possible still get positive gear property

Richard, Terrance the original poster seemed unsure how to create +CF with interest rates so high, maybe you can help him out.

I've struggled to make lease options work in a hot market, how have you got around that in Qld's boom times Richard? 

There is a report prepared by RPData that discusses median house prices but also the gross yields by suburbs throughout Australia. The report also informs new investors the transaction fees to budget for the purchase.

I've uploaded the report onto my blog: http://www.sydneypropertysite.com under Sydney Property Resources.

Cheers

Ray

Positive geared properties are still around. Have a look in larger regional areas with a population of at least 7000. Make sure that the town has more than one industry. Check that there are schools and hospitals in the area and good public transport to and from major regional centers and capital cities. Prices are lower in regional areas in comparison to capital cities,  so whatever you have saved for a deposit will go further to reducing your borrowings, which means your interest will be a lot lower.
Combining that with strategies mentioned earlier such as purchasing a house on a large block and subdividing,
or renovating the house to achieve a higher rent will work. It works for us!
Property prices in regional areas do go up in value, just not as quickly as capital cities.
But I prefer to have 5 x $150,000 properties tenanted at $200 each per week going up in value at 8% per year than
1 x $600,000 property rented at $650per week going up 10% per year.
By using our strategy we reduce our overall risk. If one tenant misses rent for a week, we can cover it. If I had one big loan and one tenant and they missed their rent, I'd be in a bit of trouble.

There are definitely ways to turn a -vely geared property into a positively geared one.  Of our four properties, two are +ve cash flow, and the other two are +vely geared after taking tax returns into account.  Our strategy is as follows:
1.  Only buy places that need some work (you can negotiate a much better price if it's unappealing – it's amazing how many people don't want to do simple things like paint, etc); and
2.  Once it's ready to rent, we fully furnish it and rent it out with all linen, crockery, cutlery etc.  This increases your rental income substantially.  To do this though the property needs to be in a suitable location – walking distance to shops, public transport, etc, so it means your initial selection of property does need to be careful and take these things into consideration.

We like this approach, especially as we do all the work ourselves, from the renos after purchasing, through to property management, cleaning and repairs, etc etc.  You could argue that we don't put a dollar value on our time for all this, which is correct – but if we don't do this, my OH's favourite past time is computer games!  So our spare time isn't exactly used to good effect normally

a friend of mine has just purchased his 2nd positive geared property in Sydney – 15% yield. His other property was positive geared on 100% borrowings from day 1 and it has doubled in value within about a year.

So it is still possible.

can't give that up! But it is prime locations.

What about dual income – ie house + Granny flat ? we have just purchased one, with a 8.5% return. We have done a quick facelift to increase the rental on the GF from about $160 p/w to $190.

Hi littleaussie,

I am looking at Maryborough at the moment.  Do you mind letting me know who your current agent is or perhaps your previous one was so we can try to avoid the same problem?  Private message is fine if you don't want to say in public.

Cheers……..TV

But it's not "really" positively geared" is it? No You are just fooling yourself that it is. The deposit you pay doesn't come from nowhere. Even if you had it in a bank account you can get 5% interest on it. So you haven't factored the loss of that money.

If that was the case then all properties can be positive geared.

My definition of a positively geared property is one where the rent is more than EVERYTHING I paid.

ie purchase cost, stamp duty, solicitors fees, bank fees, rates, strata, reno. 

My last few purchases are negative by less that $30pw from day one. In Sydney so you don't need to buy in the back of nowhere.

They will be positive taking into account depreciation.

Buy under market and increase equity and yield by doing a reno. It's working for me ATM so I'll keep doing that.

If you are happy with a negatively geared property go for it but don't delude yourself into thinking a property is something it's not.