Mate, that is the 'how much you can borrow' figure. I don't see the issue you are raising. You also forgot the rental income as well.
You seem extremely confused.
Staying motivated on a low income?
- Thread starter AndrewT
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Mate, that is the 'how much you can borrow' figure. I don't see the issue you are raising. You also forgot the rental income as well.
You seem extremely confused.
Just because I disagree with you doesn't mean the topic degenerates.
No I didn't forget the rental income. You quoted about $300k unit renting at $300/wk. With a $270k loan, @ 7%, IO repayments are $1575 a month. Rental income is $1300, less PM, rates, insurance, maintenance, body corp, etc. Let's assume 25% of rent goes to these expenses. This leaves $600/m or $5 a year this person needs to fund. That's tight. Lenders will not look favourably on that.
True. But we are now arguing pettinesses (is that a word?) Same difference - perhaps I should have said - "go off topic".
Our discussion is no longer about motivation, but whether a "low income" $35k pa net earner could afford a $300k property with a 10% deposit.
My numbers suggest no. You just say yes.
I chose to let that one go through to the keeper... the more I read from this 'guy' (I assume) the less real-life experience (outside of receiving gifts with which to purchase property) is revealed.
Edit: Lowering myself to common denominator of personal insults...
Edit: Lowering myself to common denominator of personal insults...
Noted. I shall do the same.
Contributing to the topic from my personal perspective, I am happy to have about 2 years more to save and hopefully lower my mortgage loan + create a buffer for living expenses / connection of utilities / council rates / body corporate and other misc. unforseen issues for the first year or so.
Contributing to the topic from my personal perspective, I am happy to have about 2 years more to save and hopefully lower my mortgage loan + create a buffer for living expenses / connection of utilities / council rates / body corporate and other misc. unforseen issues for the first year or so.
Everyones situation is different. If a 35yr old is only earning 35k, there may be a good reason for this. My old man has had medical issues which has severly limited his working life and needless to say, even though I am on a low apprenticeship wage - I earn more then he does. Don't assume people didn't study hard enough or are just plain lazy.
Gee AndrewT, sounds like you may have had some real life experience and can appreciate that life doesn't always go as smoothly as planned. Not like others we know.
There is often more than meets the eye to people's situations.Sympathies, if appropriate, to the "old man".
Are you seriously telling me banks won't lend to someone on 35K net salary to cover that additional $600 per month AND with negative gearing as well?
Doing the maths, that is (600 per month x 12)/$35K = approx 20% of take home pay.
Let me know which lender would not lend to such a serviceability ratio.
And this is uncommon practice to you?
For argument's sake, the $300 per week would cover sufficiently for the parents, but probably means that particular young person would need to cut down the Friday nights getting smashed at the local pub and the annual holidays. Gotta make sacrifices to own property. Can't have it both ways.
I think they were talking about 35K gross salary not net salary.
AndrewT, you know I was not referring to those with medical issues. Hope everything is well with your old man. Just seems there are many low income earners who just whinge and complain about affordability etc...but do nothing about it (or very little).
As I have mentioned many times, my parents were Vietnamese boatpeople and came here with nothing. They worked 3 factory jobs, hardly spent, don't go on holidays etc...and have since done ok now (including investing in inner city property). We know Vietnamese refugees of both spectrums, those that are similar like my parents and thus, own their own home and have numerous IP's, investments and/or doing business today. Likewise, we know those that indulged, enjoyed a lavish lifestyle, didn't work hard and now on Centrelink payments still paying off the house in suburbs like Sunshine and Maidstone.
Look, I am not trying to put down people but firstly, and honestly, you must ask yourself the question why you are on a low income and if applicable, why your parents have not succeeded or become financially more well off. The sooner you realise this, the more you will thank me. Maybe if you think about it truthfully, perhaps you did slack off at school. Perhaps you preferred to work the basic 5 days and not on weekends (so as to earn that little bit extra). Perhaps you took a sick day, but in fact, deep down you knew you could have attended work. Perhaps you shouldn't have spent that much on a car, or gone on that holiday which you seem to slot in every year. Perhaps you blow hundreds of dollars per year on cigarettes and beer. Perhaps you always got the latest gadgets. Maybe you got/have a girlfriend and boyfriend and eat out every second night.
Before anyone comments on my 'privilege', let me tell you guys that I work 7 days a week including public holidays (my normal full-time job and shift work at a cafe). I had 3 jobs during university (even overloaded and did 5 subjects per semester). I worked part-time at a property consulting firm, tutored over 20 hours per week and did shift work at the cafe. I have not gone overseas for nearly 10 years (and that was a student exchange program in high school). I bring lunch to work, walk to and fro work, eat breakfast and dinner at home, spend Friday night's at home (hence why it seems I am on SS often) and play board and card games on Saturday night with mates (so no money spent) and on most weeks, my discretionary expenses is $0.
Of course, I can spend if I wanted to. Heck, if my parents can give me a big cash handout, and own a close to $1mil house at the age of 24, then surely I can spend right? No...because I am very much brought up like my parents - save as much as you can when you are young and you will hopefully reap the rewards later on. I like to earn and invest, more than spend. It is a personal choice, so next time you guys question my supposedly 'fortunate upbringing', think about who is the one that sacrificed the most. Do you guys spend your weekends and public holidays working? Can you top $0 in discretionary expenses per week. Are you able to consistently not spend a cent on a Friday or Saturday night.
I think you are right luckyone, although wobbycarly should know we are working with a net salary figure.
Hmmm. If you have medical disabilities, that's very unfortunate and we should count ourselves lucky. Some things are unfortunate indeed.
Holding all things constant though, a lot of low income earners are quite lazy, eg people just chilling in some job earning 35k working 9 to 5, Mon to Fri. These people shouldn't be complaining honestly, because I know I worked my b*** off to get what very little I have now. And admittedly I have been lazier as these little extra cash kicks into life, which is not a good thing (ie the lazy part).
At one point when I was earning very little (relative to what I had earned before) at a bit less than 70k and was working 9 to 7, I used every extra hour I had to make money and often worked side jobs for another 3-4 hours after work every weekday, and also worked probably half my weekends. I would drive from client to client between 7:30pm and 12am through bad traffic, eating my takeaway dinner in 10 minutes in the car etc. I did that for around 12 months and when things picked up and I moved to something that paid more reasonably, I still kept up my side jobs. During my time in the other job, the rest of my colleagues were content with 70k and went out drinking, partying and blowing their money and time. Each to his own I guess.
How would you know!! Have you ever tried to save for a deposit on a low income of just $35 K pa??
Oh thats right mummy and daddy are holding little johnnys hand
How about you go out into the real world. Cut off ties with your parents. Go it 100% alone and see how you go saving and managing on your own income without the support of your parents!!
I think it is great that you are in a good position dont get me wrong. But you have absolutely nooooo idea mate. lol are you for real!!
Yes he does, apparently we are supposed to share a flat with a bunch of uni students, eat baked beans for dinner (and that's on a good night, most nights we should be going to the Salvos and asking for handouts so we can make ourselves rich), spend 3 hours catching public transport to/from work, wear clothes with holes in them, and only bathe once a week to save on water. Don't know about you Kim5, but I think I'd rather buy "bad investments" for $300K than Toorak investments for $1M than live like that.
I'm actually finding the more he writes and the more I learn about him, the more amusing his posts become.
Thats b*****.
When I got my first loan I was earning $37 K gross. I was only able to get a loan for $177 K with ANZ. If I had gone with another lender maybe I would have got a bit more I dunno but certainly not $342 K. Your dreaming!
Yes he does, apparently we are supposed to share a flat with a bunch of uni students, eat baked beans for dinner (and that's on a good night, most nights we should be going to the Salvos and asking for handouts so we can make ourselves rich), spend 3 hours catching public transport to/from work, wear clothes with holes in them, and only bathe once a week to save on water. Don't know about you Kim5, but I think I'd rather buy "bad investments" for $300K than Toorak investments for $1M than live like that.
I'm actually finding the more he writes and the more I learn about him, the more amusing his posts become.
yeah it is quite entertaining isnt it. did you read his other thread - the melbourne one from about 6 months ago. was very funny! lmao
We have had to make sacrifices just like you, so that in the future we will have the chance of being well off and reaping the rewards. I work nearly 7 days a week at the moment, 60-70hours a week and 1 weekend off a month. This does nicely to top up our wages while I finish up my apprenticeship, then once I finish the apprenticeship - I'll cut down to one or two weekends a month.
Every friday, saturday night we usually spend at home with each other. We don't drink or smoke. That's one thing that I honestly find ridiculous. How many low wage workers smoke 3+ packs a week! I don't know how much a pack costs but @$10 thats $1,560 a year that could have been spent else where.
I think at the end of the day just aslong as your really appreciative for what your parents have done for you then your ahead of alot people in our generation. There are so many friends that take it for granted, they play up week after week because they know, at the end of the day, they are set up for the future.
