Forums / Getting Technical / Finance / Inclusions & existing house

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  • Profile photo of robert_griffiths3599robert_griffiths3599
    Member
    @robert_griffiths3599
    Join Date: 2002
    Post Count: 3

    Hi All,

    I’m very new to all this, and am trying to get active after years of fear.

    What do I need to include, when considering costs? eg financing, insurances, maintenance, council etc what are they specifically?

    Also we didn’t obtain the price we wanted when selling our home, so we are renting it out instead. However cashflow wise it’s killing us. General overview is P&I mortgage $1300, rent $1000, any suggestions on how to improve this to maybe a postive cashflow?

    THANKS in anticipation…[blink]

    Profile photo of GeronimoGeronimo
    Member
    @geronimo
    Join Date: 2002
    Post Count: 167

    Hi Robert

    First of all, I would recommend changing to Interest only. It will initially ease your cashflow and P&I is pointless in my opinion if you are looking to invest again in the future.

    As for costs, don’t forget to budget for Council rates, landlords and building insurance (which I hope you have already, if not, GET SOME!), maintenance, and bank fees if you have an ordinary loan from a bank, and managers fees.

    Hope this helps.

    Brendon


    Acute Mortgage Reductions
    http://www.acutemr.com.au
    [email protected]

    Profile photo of robert_griffiths3599robert_griffiths3599
    Member
    @robert_griffiths3599
    Join Date: 2002
    Post Count: 3

    Hi All,

    I’m still needing help, any more ideas please….[blush2]

    Profile photo of mistymisty
    Member
    @misty
    Join Date: 2004
    Post Count: 72

    Hi Robert,

    I am not an expert but have been in similar situation. As far as I am aware, unless you can gain a higher rent, or cut your costs, there is no way to improve the cash flow.
    Options to cut costs are pay of lump sum (assuming some access to cash), re-finance and extend the period of years outstanding, interest only.
    Although in general it is advisable to try and hold property, there comes a time when it is better to sell, even at a lower price than you really want. You may find that this is one of them.
    It all really depends on the value of the property and how much mortgage you have.
    Consider the costs you are losing every month as against the loss you believe you will have if you sell. Also there is still the possibility that property will drop a little further in price, exageratting your loss.

    Hope this helps.

    Profile photo of Mortgage HunterMortgage Hunter
    Participant
    @mortgage-hunter
    Join Date: 2003
    Post Count: 3,781

    What interest rate are you currently paying?

    As suggested IO is an immediate wasy to reduce the repayment.

    Simon Macks
    Mortgage Broker
    http://www.mortgagehunter.com.au
    0425 228 985

    Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.

    Profile photo of DerekDerek
    Member
    @derek
    Join Date: 2004
    Post Count: 3,544

    HI Robert,

    In addition to I/O loans I woudl recommend you get a depreciation report completed and then, if appropriate, complete a PAYG Income Tax Variation advice. This way you’ll get your lump sum tax refund during your regular pay periods.

    Derek
    [email protected]

    Property Investment Support Available. Ongoing and never stopping. PM welcome.

    Profile photo of brahmsbrahms
    Participant
    @brahms
    Join Date: 2004
    Post Count: 485

    Hi Robert,

    a couple of questions come to mind…why?

    1. are you renting out this property (at a loss)
    2. where are you living now?
    3. tell me more…

    cheers

    Brendan Heagney
    Mortgage Broker
    0438 436383

    If you don’t ask, the answer is no!!

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