I guess all of us have different strategy.
But you have'nt taken into account that the large deposit you put in could be sitting in a bank account earning 6% interest.
$342K @ 6.8% = $447pw + levies + water & council rates + management fees + land tax (if you own it in a Trust).Amsaini is correct, you could have effectively done the same thing with minimum deposit and put the rest in a offset account. Where possible, Never ever place your own funds in an IP or you PPOR for that mattter.
The negative cashflow as mentioned above is not a big issue as it will become positive in due course (rent today is not the same as yesterday)….
Overule: you are right in saying we all have our own strategy. It is just that some strategies will provide a quicker path to retirement or whatever it is you are trying to achieve: they call this opportunity cost.
number 8 wrote:Amsaini is correct, you could have effectively done the same thing with minimum deposit and put the rest in a offset account. Where possible, Never ever place your own funds in an IP or you PPOR for that mattter.
The negative cashflow as mentioned above is not a big issue as it will become positive in due course (rent today is not the same as yesterday)….
Overule: you are right in saying we all have our own strategy. It is just that some strategies will provide a quicker path to retirement or whatever it is you are trying to achieve: they call this opportunity cost.
I have to agree, provided that you can service the negative cash flow, if you had used a minimum deposit you may have been able to purchase 2 properties with the deposit you put into one.
Who is your target market that you will be renting to? If it is mainly families that live in that are, than they will prefer carpets. If it is a young, trendy professional area, than they generally tend to prefer floating floors. If you use materials and target your renovations to the people who live there, you will get much better rental returns.
Wishing you every success, Ana Stankovic
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