I read with interest Adams comments on CF+ homes and the price point he suggested starting in.
If the CF+ product is under $320,000 there is little chance that there is going to be any tax relief in it.
This being the case, buyer beware that you are not adding to your taxable income and therefore increasing you tax threshold.
The advantage of buying negative geared cash positive property should never be omitted from your research.
Regards
Kevin
041 0033 658The advantage of starting in a low price bracket is that new investors learn what is required to research and purchase a property without an immense amount of financial risk. You may make mistakes on your first property purchase, but ultimately if you follow the 'rules' and buy in a decent area with diverse employment opportunites and good rental demand, then you will have a sustainable property that is providing cashflow and hopefully some capital growth over the long term.
Then as you become more savvy, if you find that this first property is a slow performer compared to others in your portfolio you can offload it and free up some capacity to invest again.
BTW, while negative gearing is acceptable to the ATO, there are ALWAYS tax benefits in investment properties.
Granted BrisInvestor that the lower purchase price appears safer, but if the first purchase is using advice from seasoned investors and sales agents the price point can be any reasonable one!
We call the process 'The Guded Discovery'.No investor should lose money through mistakes in the beginning when there are companies and people to guide them correctly.
I have been involved in Investment Property 'selling and purchasing' for 14 years now and still I see people thathave investments doing it wrong.
The process of property investment should be taught in schools.
Regards
K
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