All Topics / The Treasure Chest / How to achieve positive cash flow

Viewing 7 posts - 1 through 7 (of 7 total)
  • Profile photo of wisdomwisdom
    Member
    @wisdom
    Join Date: 2003
    Post Count: 3
    August 4, 2003 - 11:43 am

    Hi,

    I’m really interested in buying an investment property with a positive cash flow. After looking at the prices of properties in some of the outer suburbs in Melb, I can’t seem to work out how to invest and come out with a positive cash flow – even when taking out an interest-only loan.

    Wondering if I am missing something here? I notice Steve Knight was previously an Accountant, perhaps he has some insights I’m currently missing!

    Appreciate anyone’s feedback on this.

    Cheers,
    K

    Profile photo of westanwestan
    Member
    @westan
    Join Date: 2002
    Post Count: 1,950
    August 4, 2003 - 12:46 pm

    Hi wisdom

    i havn’t been following the outer suburbs of Melbourne, you may have to look further out to regional cities. Steve actually mentioned this on today tonight. As an example of a cash positive deal i did last April in Horsham. Purchase price 74k
    Cash on deal 20% cash the rest borrowed at 5.65%
    Loaned 59,200 @ 5.65% interest $65 pw
    Rates and water 20pw
    Insurance 5pw
    Agents fees 11pw
    Total 101pw
    Income Rent 155pw
    Profit excluding repairs/vacancies 54pw

    see it is possible
    regards westan

    Profile photo of wisdomwisdom
    Member
    @wisdom
    Join Date: 2003
    Post Count: 3
    August 5, 2003 - 12:53 am

    Thanks Westan,

    The example you provided was great. Agree, I think I need to be casting my net a bit further in order to find the properties which will enable positive cash flow.

    Appreciate you taking the time out.

    By the way – I’m aspiring to gain wisdom – still on the journey!

    Profile photo of nessness
    Member
    @ness
    Join Date: 2002
    Post Count: 14
    August 6, 2003 - 5:40 am
    Quote:
    I too have had trouble getting started, i.e. where to start. So I took what I thought was an easier road, renos, but I an tell you its much easier focussing on research than it is reno and waiting to sell. Its been painfull and stressfull! So I’m now starting again and focussing on major regional areas as a starting point. Good luck [;)]
    Profile photo of PropertyGuruPropertyGuru
    Participant
    @propertyguru
    Join Date: 2003
    Post Count: 1,502
    August 6, 2003 - 5:47 am

    Dear Westan,

    You gave good example. But how do you find these deals just from the normal real esate websites or do you guys got some special agents etc.

    Thanks

    Amit

    Profile photo of westanwestan
    Member
    @westan
    Join Date: 2002
    Post Count: 1,950
    August 6, 2003 - 7:55 am

    Hi amitash
    most of my deals have been just the way everyone gets them keep ringing agents to find out what they have got. But i have in the last few years had agents who i have purchased with call me with good deals. The problem of agents is they get so many calls from people who are after properties but aren’t really buying. try to work out where you want to buy and develop a good relationship with agents in the area, sometimes it pays off. i’ve got 5 houses in the town i live in (Stawell, Vic)and the agents know i’m a buyer but sometimes they don’t follow through with things as i would like. For instance i spoke to and agent (sounds like the Matrix) about a house he had and was about to list, asked him to phone with the asking price when he knew it. a few days later i rang him and he had already sold it. (To another person on this forum).
    regards westan

    Profile photo of williwilli
    Participant
    @willi
    Join Date: 2002
    Post Count: 186
    August 6, 2003 - 9:03 am

    I agree it is note easy, but keep in there. The internet is a great resource, just keep searching and applying the 11 second solution…

    Good Luck All

    Pete

    …Beware of the dreamtakers…

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