Hi, firstly if i’m breaking any rules here please someone let me know. I’ve found what I believe is a positive flow property but am still reading the book and not in a position to go ahead with buying at the moment. Its in Qld has good tenants great condition fully furnished (good depreciation I believe as well as the building depreciation) and is a little undervalued according to the current bank valuation. Is there someone in Brissy who is experienced and ready to buy again who I might share this tip with who later on in the year when i’m ready might help us out back with finding another property? I guess i’m looking to trade my possible find (and i’m definately no expert) for your expertise later on down the track. regards HG
You may get a better response if you post some general info about the deal.
i.e
house or unit
general area
price
rent
Features i.e b/rooms etcHi All, more info – its a duplex with current tenants in place for another 12 months, 2 years old, asking 185,000 with a net rental return of 246.00 pw. The agent states (and I know its true) that recent info in the area says to expect a 10% growth over the next 12 months, I am expecting a phone call back re the property after 4 pm today. HG
Hi HG,
How your property fit into 11 second rule. or you are saying it’s +ve after tax?
Amit
Hi All, more info – its a duplex with current tenants in place for another 12 months, 2 years old, asking 185,000 with a net rental return of 246.00 pw. The agent states (and I know its true) that recent info in the area says to expect a 10% growth over the next 12 months, I am expecting a phone call back re the property after 4 pm today. HGHi there! Sounds interesting!
Are Body Corporate Fees applicable to this duplex or other duplexes for that matter?
Does this vary from State to State?
Any idea on what the Council Rates are?
Just doing my homework. Hope someone can help.
Bye for now
[:0)]Hi Amit, the agent is giving me the following scenario, 185,000 price, 37,000 deposit, 148,000 loan at approx 6.6% over 30 years which equates to a repayment of 942.28 pm. The current rent after rates, body corp fees etc is 246.00 pw net plus deductions for building and furnishings – so to a very inexperienced beginner this looks like a +ve property – am I right? HG
Dunno – youve got me there!
HG – it’s only positive by $27 per week in this scenario, is that really a good enough return considering you’ve put in $37,000 (plus costs of approx $9,000) to achieve it – I’d vote no unless has significant capital growth/multi-use potential as well.
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MelHi Amit, the agent is giving me the following scenario, 185,000 price, 37,000 deposit, 148,000 loan at approx 6.6% over 30 years which equates to a repayment of 942.28 pm. The current rent after rates, body corp fees etc is 246.00 pw net plus deductions for building and furnishings – so to a very inexperienced beginner this looks like a +ve property – am I right? HG
Hi HG,
Lets calculate. 246*52 = $12792
we will give 5% vacancy rate so this income will become $12152.so for each month income = 1012.70
positve cash flow every month = 66.42
according to this calculation there is +ve flow though not much. I think if there is good capital growth then this property could be good deal.
but lets wait for other astute investor advice.
Cheers
AmitI’d have to disagree – I believe there are better deals around than that!
Yes you right Shane it’s not very impresive deal from +ve cash flow point.
and I think Shane you are going to hit Century today only! [
]Amit
Hi HG..
Where is this property etc??
Who is selling it??
I think I am interested.Do you know the rates and the body corporate details?
Or even simpler rental PW b4 rates and BC??Is it currently Let at the moment or did the agent suggest that you could get $246 per week??
You can contact me on my email below.
Thanks, if it works out I will definately recipricate.
Cheers
Calron the Alcamist
Turning things into gold is fun.
[email protected][]Hi All, had my chat with the agent. They are saying 10% return – which is a little short so they are only just pcf. But they are getting back to me with more details. But I have discovered that there is more than one for sale – all are tenanted with a waiting list for new tenants to move in. Only 150m to bank and shops and on bus route. The agent is saying you should make 30 – 80 pw depending on your tax situation – however these calculations are all presuming I offer 185,000 – if I offer less and its accepted then obviously i’m more in front. Does anyone know how depreciation will affect this deal – if its 10% return plus depreciation and building depreciates at 2.5% plus depreciation on f&f at ?% (don’t know how they depreciate fixtures and furniture) does this get it well into the 11 second rule then??? HG
The 11 second rule is a LOAD OF BULL****!! What if interest rates increas by 5%???!!! ( or less) Then where is that 11 second rule? Our friend just made money at the right time – think about it!
Shane.
How many Properties do you own??
What makes you so sceptical?
Cheers
Calron the Alcamist
Turning things into gold is fun.
[email protected][]I own reasoning!!!!
forgot to add – rent is increased 6 monthly in line with cpi adjustments also. hg
HG,
Is this aged care accomodation?
If so, you may face some trouble with finance as banks will only lend 70% of the price.
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