How does it all work
Looking at a recent magazine they had a story of recently purchasing a property at $270,000 renovating it and revaluing it at $330,000 to $340,000 giving total equity of $92,629 available if financed at 90%
They have worked out the available equity by valuation at 90% minus the debt
Assuming they purchased using equity from other properties and also got 90% finance what is the real costs going in and real equity available
Would it be correct to assume they went in using equity from other property as the deposit of $27,000 and financed at $243,000
The renovation was a few dollars shy of $10,000 and stamp duty, transfers, mortgage costs would have been around $8,500 then you would have loss of rent but mortgage interest over the renovation period of possibly 4 weeks (5% io loan) of $1,013
That works out to be an additional $19,000 and doesn't include Buyers Agents fees (which they used) pest and building inspections and conveyencing,legal costs. Could you add another $6,000 to round up to $25,000 purchasing costs?
Renovations consisted of reconfiguring the living space, repairs and maintenance, improving the kitchen and bathroom, new flooring throughout, new blinds and new paint job.
The actual equity if the property is valued at $330,000 is now approximately $62,000
Rent after the renovation is now $350 per week
Are these figures correct or close?
Is that enough to look at purchasing again?
Looking at a recent magazine they had a story of recently purchasing a property at $270,000 renovating it and revaluing it at $330,000 to $340,000 giving total equity of $92,629 available if financed at 90%
They have worked out the available equity by valuation at 90% minus the debt
Assuming they purchased using equity from other properties and also got 90% finance what is the real costs going in and real equity available
Would it be correct to assume they went in using equity from other property as the deposit of $27,000 and financed at $243,000
The renovation was a few dollars shy of $10,000 and stamp duty, transfers, mortgage costs would have been around $8,500 then you would have loss of rent but mortgage interest over the renovation period of possibly 4 weeks (5% io loan) of $1,013
That works out to be an additional $19,000 and doesn't include Buyers Agents fees (which they used) pest and building inspections and conveyencing,legal costs. Could you add another $6,000 to round up to $25,000 purchasing costs?
Renovations consisted of reconfiguring the living space, repairs and maintenance, improving the kitchen and bathroom, new flooring throughout, new blinds and new paint job.
The actual equity if the property is valued at $330,000 is now approximately $62,000
Rent after the renovation is now $350 per week
Are these figures correct or close?
Is that enough to look at purchasing again?