Will it be easy to finance? – Depending on the LVR and title. 3 dwellings on one title is fine with most lenders however each lender will have an LVR threshold that they will lend to so its important you choose a lender that goes to the LVR ceiling that you need it to go to. As an example, ANZ only goes to 70% on multi dwellings on a single…[Read more]

$10k a year was an example. Also with the above calculation – you are not factoring all outgoings? Also have you factored in all your upfront costs such as the deposit, LMI (if applicable) etc?

Having said that I think you have got the idea of comparing/offsetting the negatively geared loss against the CG. 

Regards

Shahin

Ok so you have been cross securitised. Let's park that for the time being. Do you remember how much LMI you originally paid?

If the loans were set up correctly and based on today's figure – you would be paying around $12k in LMI.

The thing is that in these scenarios – many combine the two and they paid LMI on the higher loan amount and LVR…[Read more]

Let's start again – ok so you have 2 properties and 2 loans. What is the value of each of the loans and what is the value of each of the properties?

Regards

Shahin

Absolutely. That's the idea – to make equity and re-invest that equity. There are different ways to create CG which in turn defines your strategy. Renovation is one but you need to ensure you do not overpay as there may be other investors with the same idea which often results in people overpaying for the property.

Regards

Shahin

Short answer – no. Citibank is the only lender that (under certain conditions) does not have LMI payable for LVR's of up to 85%.

What is the value of the property? Also is it one property or 2 properties?

Regards

Shahin

Let's clarify – no one is saying don't buy negatively geared property. The message is don't buy negatively geared property that is not going to be superseded by what you will get back in CG during 'x' period of time.

So let's use one simple strategy/example – you can pick up a dump in Rozelle and pay below market, renovate it and sell it for a…[Read more]

Im originally from CC and think it would be great if the area got extra employment. I know many people that choose to live in the area but make the long trip to the City due to a lack of employment opportunities on the coast.

Regards

Shahin

You will not find anything 10km from Sydney which is Positively Geared unless its a development site and you develop the property. This option of course requires serious capital. 

What's your IP strategy? This should in many ways dictate what to buy and thus where to buy.

Regards

Shahin

Other than the upfront costs – here are a list of the ongoing costs which we factor in when we do the cashflow analysis:

1. Expenses
2. Council Rates
3. Strata Fees (if its strata titled, i.e. a unit)
4. Water Rates (not payable in NSW if  its a house)
5. Landlord Insurance
6. Management Fees
7. Building Insurance (if its a house)

Yes there are…[Read more]

Yes – its best to have your finance pre approved prior to you starting to looking for properties. That way you now exactly how much you can borrow. Make sure that your banker or broker gets a credit assessed pre-approval instead of a system pre-approval. Most banks are now offering this. 

Also when you are applying for finance you need to ensure…[Read more]

Hi There,

Im not by any means trying to sound negative but your property is heavily negatively geared which means that you are losing money. 

Treat it as a business – why are you doing it if you are losing money?

Look at how you are going to make enough equity and profit to make up for the loss you are currently making.

When you look at…[Read more]

Get a good conveyancer – especially one that is sharp and quick to respond. For example, if you find a good property then you want the conveyancer to look at the COS straight away and order the Building and Pest Inspection immediately. Finance Broker does not need to be local but if you prefer the face to face interaction and someone that also has…[Read more]

Be careful of using your cash instead of using finance for the purchases. Also why are you looking to buy new? Whats the strategy?

Regards

Shahin

It is a huge risk to go overseas and do this type of work. Huge cudos to him.

Regards

Shahin

Ok so if you have an aggressive strategy which it sounds like you do – then you need to ensure that you will be ok from both a deposit perspective as well as servicing. There are ways to ensure you maximize your servicing. An obvious example is that different lenders lend different amounts. Some have amore conservative borrowing capacities…[Read more]

Negative gearing is a benefit and not the sole reason you invest in property. Remember that at the end of the day negative gearing means that you are losing money.

Have you thought about CG? Have you come up with a IP strategy? Have you thought of medium to long term?

Regards

Shahin

There are at least 3 lenders that don't have an employment duration policy. Tackle that option first before venturing into personal loans. 

Personal loans can work but they also do hurt your application strength. Again re-visit the possibility of your mate getting a loan.

Regards

Shahin

Hi David,

You are looking at it the wrong way – most of Sydney is good to buy. The question is the opportunity – i.e. what can you do to the property to create a higher yielding property or create CG.

I know your budget is tight so your options are limited particularly in the Sydney market but what is your exact budget and whats your IP…[Read more]

That is a major issue but easy to fix $700 is way way way too much. What is he doing for $700? 

The problem is that the water will be leaking to the membrane and the flooring underneath the house. This is very bad. 

Regards

Shahin