Okay, found this one on Realestate.com.au, so why is this property positive cash flow, or is it?
Cheers,
GeoffB$9500 annual rent divided by $55,000 = return of 17% loan interest rates around 10% that is 7% positve after interest payment on loan.
What you need to find out is what the Strata fees are. How much does having the in ground pool cost you each week ?
Are there management fees you have to pay each week.
Fully furnished – is there depreciation of fittings ? Do you have to replace fitting over time ?
Does building depreciation come into the positive gearing claim.
Are you able to get finance for this type of property ?
Do you have to pay for repairs to the common property . Like lifts, stairwells , paths, life guards, ect
From the expected rental return it would seem positively geared but if you have to pay extra running costs like mentioned above plus water rates, Council rates, insurance it may look not so positive.With these sort of places, cleaning/laundry costs per visitor can often work out at 20% of the gross rent.
You'd probably end up with a place that is neutrally geared.
And hard to onsell.
But you'd have somewhere cheap to holiday – it's not a bad place, Treetops.
The killer blow would be the huge BC/maintenence costs, not stated. I doubt it would be anywhere near even CF neutral.
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