[avalonesaParticipant@avalonesaJoin Date: 2013Post Count: 11]

March 21, 2013 - 9:11 am

Ok, I guess we'll just focus on paying down the loan a bit more for the time being and maybe prices will come down and we can jump in again

My second question would be, which areas of Aus can I find a + cashflow IP ?

I've heard the UK market is starting to recover, should we be looking overseas instead?

[avalonesaParticipant@avalonesaJoin Date: 2013Post Count: 11]

March 21, 2013 - 8:12 am

current lender is bankwest.

property cost $290k and we put down a $40k deposit

[avalonesaParticipant@avalonesaJoin Date: 2013Post Count: 11]

March 20, 2013 - 11:43 pm

Thanks for the help Jamie.

So loans 1 and 2 are from the same bank right? Or can loan 2 be from a different bank? Must they send a property value assessor to the residence first to obtain the current value?

"Second loan split for the equity release" ? I don't know what that means?

When you say, "deductible", you mean tax-deductible right?

So what exactly is the deductible part of the "equity release for IP deposit" loan? The interest on that loan?

[avalonesaParticipant@avalonesaJoin Date: 2013Post Count: 11]

March 20, 2013 - 11:39 pm

Current loan amount is about $250k and apartment is valued at $290k (also purchase price)

Purchased it last month.

Just want a guide as to how to go about getting the next investment property started. Our income is going up to $200k/year at the end of this year.

[avalonesaParticipant@avalonesaJoin Date: 2013Post Count: 11]

January 28, 2013 - 11:42 am

So where would you say is a good place to invest in Melbourne? The outer suburbs?

I still think anywhere in the west is a good buy, no?

Also, although these companies may move out from the CBD, the cbd will always be there and being close to it will surely always be better than being further away no?

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January 27, 2013 - 1:05 pm

is LMI an annual thing or just a once off payment?

the annual body corporate is like $700 and rates are like $300 I think.

For some reason I just can't see this property growing another 2 times in value over the next decade but who knows what could happen.

I heard Melbourne's population is set to outgrow Sydney's and reach 6 million by 2037. I don't know about you, but I like the idea of living within 10km of the cbd in the world's most livable city where population is growing exponentially.

[avalonesaParticipant@avalonesaJoin Date: 2013Post Count: 11]

January 27, 2013 - 12:56 pm

IT has been painted and new stove and aircon/heater installed. It also has a separate toilet to the bathroom.

Yes it can be improved, the spacious lounge could be turned into a 3rd bedroom with the addition of a wall making a hall way entrance with kitchen on left and bedroom on right. Kitchen could become living room to eat meals in as its quite a spacious kitchen.

How much is it to install a simple 5 metre long wall? 

Then we'd rent it out as a 3 bedroom flat, at $130 per person (very cheap rent considering its within 10km of cbd I think), thats $390 a week and $1560 a month. Mortgage repayments are $1500 a month so that means it would be positive geared by $60 a month right?

How much equity would a 3rd bedroom add?

[avalonesaParticipant@avalonesaJoin Date: 2013Post Count: 11]

January 27, 2013 - 12:36 pm

Sorry but where did you get the $10k per year figure?

if it was tenanted at $270 a week, thats 52 x 270 = $14,040 a year

repayments = $18k a year

So isn't that  negatively geared by approximately $4k for the year?

I really do think it will grow at least $4k a year, considering that the same distance from the cbd on the east and north side of melbourne is fetching $350k for the very same apartment features.

We couldn't afford to get a house within 10km of the city, and thats where we wanted to be.

[avalonesaParticipant@avalonesaJoin Date: 2013Post Count: 11]

January 27, 2013 - 8:14 am

@thefinanceshop

Thanks for the response.

When you say heavily negatively geared, you mean the rental payments do not cover the mortgage right?

It will be owner occupied for the first year (it has to be since we took the first homebuyers grant) but then we may rent it out and move out. There is the opportunity to convert it into a 3 bedroom (turn the living room into a bedroom) and possibly rent it out at $400 a week (3 student tenants at $130/week would be easily achieved in melbourne I think) which would make it 'positively geared' right?

There are tax benefits to having a negatively geared property aren't there? What are the benefits of a negatively geared property?

We have looked at the capital growth potential, and we found that the western suburbs probably offer good potential over the next years as the government is investing in the west. We could not find a 2 bedroom unit in melbourne anywhere for under $300k except in the west. It seems to be the cheapest option, and as the past has shown us, the cheaper and less popular suburbs of melbourne have shown the most capital growth over the long term right?

Where can you buy a positively geared property in melbourne?