96% chance that rates will drop by 1% at next RBA meeting

[Petal]

Yay one of mine just went slightly positive too so after next week should be more to come!

Just curious, do you guys have some formula you use to calculate if your IP "just went slightly positive" i.e. do you include all outgoings or just the interest minus rent.

 

[Tash_85]

Oz and NZ have always has a 2-2.5% premium in terms of rates.

Would be great to get to 1.5% RBA rate....a that rate it would be cheaper to buy than rent. That in turn should stimulate growth because on a 350k borrowing it would cost your about $260 pw.....a lot cheaper than some low end rents.

If you borrowed only 200k it would cost you about $140pw in rental payments. Even if you were unemployed you could pay this!

Nice calculations. If the cuts are 1% my IR would be 5.06% with CBA, that would be around $140 off my repayments a month

I wanted to buy in cammeray but just a "little" out of my price range. Never mind have to start somewhere i guess even if it is out west.

 

[buzzlightyear]

Just curious, do you guys have some formula you use to calculate if your IP "just went slightly positive" i.e. do you include all outgoings or just the interest minus rent.

Include all expenses

 

[boomtown]

Just stick all the expenses on an excel spreadsheet. It isnt hard - maybe 20 minutes of work.

 

[SOULFLY3]

i am prob completely wrong but i thought there was a formula to work out positive and neg cash flow?

 

[Nathan]

all properties have different expenses, land tax, strata vs no strata, strata levies vary, no quick formula...

need to have em on a spreadsheet.

it includes all expenses and outgoings.

 

[sparky23]

Then factor in your depreciation and tax breaks aswell as your rent.

 

[Nathan]

the tax, is bonus in my calcs, if i wasnt working i wouldnt have any tax to pay for starters... so therefore cant claim it back...

however u buy it for neg gearing purposes then it can be few k a yr in your pocket, but depends why one purchases for....

i like to consider the tax just as the after dinner mint

 

[yadreamin]

Its all very well for the RBA to drop rates by what ever % its just very very annoying the banks dont pass on the full cut and what ever cut they give us it takes a good 2 to 3 weeks to pass it on.
Strange how when the rates where going up the banks passed the full rise in a matter of days.
lthink they will drag their feet even more with the next few cuts
cheers
yadreamin

 

[chilliaa]

Its all very well for the RBA to drop rates by what ever % its just very very annoying the banks dont pass on the full cut and what ever cut they give us it takes a good 2 to 3 weeks to pass it on.
Strange how when the rates where going up the banks passed the full rise in a matter of days.
lthink they will drag their feet even more with the next few cuts
cheers
yadreamin

easy then dont borrow

 

[sparky23]

the tax, is bonus in my calcs, if i wasnt working i wouldnt have any tax to pay for starters... so therefore cant claim it back...

however u buy it for neg gearing purposes then it can be few k a yr in your pocket, but depends why one purchases for....

i like to consider the tax just as the after dinner mint

That response was meant for petal to make sure she remembers to include it when she does her sums. I assume petal is a girl? LOL

 

[Nathan]

hehehehe... all good sparky

tax time is always nice time with IP's (just not this time of year with land tax )

 

[Nth Brisbanite]

Someone take his rose-coloured glasses and stomp on 'em for me.

I predicted that the banks would pass on the full 1%. Your above comment wasn't very nice - what about an apology?