Can anybody achieve cashflow positive ?

GF is a good way to go, how much will it roughly cost, I have a figure of 30K for very basic GF.

Talked to my PM, if I want to rent the house and GF out separately, I was told better to factor in the extra cost of water and electricity charge into the rent rather than put in separate meters, which would cost $20K.

any thoughts?
 
you can get a pre-fab GF for about $35k in kit form.

some councils won't even require planning consent if it's under 60sqm.

generally, these types of arrangements are best as self managed, or a pre-determined amount removed from each utility bill.
 
virgo said:
Hi Travelbug

How did you go about getting the bank to "increase your value" after reno?

Which bank did that for you if you don't mind sharing....having a bloody time with CBA atm....:mad:
thanks
Click to expand...

I didn't need to top up the loan. I didn't get an "official" reval.

I haven't had an "official" reval on any of mine yet. When the deposit money runs out I will tackle that.

St George have just put the value up on the computer when I've asked for more money. :D:D

New to CBA so I'll see how they go next year when I will need more for deposits.
 
ericproperty said:
Talked to my PM, if I want to rent the house and GF out separately, I was told better to factor in the extra cost of water and electricity charge into the rent rather than put in separate meters, which would cost $20K. any thoughts?
Click to expand...

Yes, your PM is insane - get a new one :p

Water meters - OK you can put in a flow meter to the granny flat and work out the charges - but the PM has to read the meter every Qtr. Cost = not very much (a couple of hundred $'s perhaps for the plumber and the flow meter).

Electricity meter - $550 for the meter (utilities contractor does this)
Maybe allow $500 for the sparkie to jig all the wires up to the new meter).

How your PM gets $20K out of this I have no idea :confused:

In NSW your tenant can only be charged for utilities if they have their own sep. meter. You can't split the bills on the basis of number of people or floor space etc.
 
travelbug said:
We actually paid for the reno (not borrowed) so it is CF neutral at worst.

Forgot to add the $50K increase in value. Value $290K now. Surely you wouldn't mind getting $50,000 for 4 weeks work.:D:D

If we had sold it straight away we would have cleared at least $25K after tax. Again not bad for 4 weeks work (part time- still did our day jobs).

The one we are doing now will have similar numbers. Cheaper buy but little less rent.
Click to expand...

Yeah exactly, I was just joking. I totally agree, you now have a high valued asset to your name that's costing literally nothing to hang onto. That is the right path to be on!
 
I like the Granny Flat idea, because you can kind of get your cake (capital growth area) and eat it too (nice yield).

Otherwise to get a similar yield, you are generally buying into some dicey regional area that may not see much growth and that will also be very difficult to sell in when the time comes too.

Renting out individual rooms to uni students is also another good one, although there is a bit more overhead with managing it, but the yields can be great.
 
What you may have been able to do in the past is not readily available today. Lenders are now required to operate under responsible lending guidelines from January 1 this year, so increases, top ups, additional advances ( all the same thing-ie an increase to your existing loan) will require a valuation in almost all cases. It would be unusual for this not to be required now.

As far as Cash Flow positive is concerned, the most feasible option is the National Rental Affordability Scheme. The nature of the scheme turns most NRAS eligible investment properties into CF positive after the first year.

Look for posts on NRAS, and you'll find a lot of information.
 
They are out there, I know of one area where you could get 5 to 6% without even trying or looking for value - the area is screaming for rentals too. I would say with some effort you could maybe get to 7% or higher. And there is potential for capital growth. Just need to look.
 
All of mine are +ve currently ( 3)
First one- held it for over 7 years before it became +ve :(
second one - had to spend $20,000 on renovations plus it was not tenanted for 4 month....+ve after 2 years, 1 year after renovations
Last one - +ve from day one- but it was a inner city apartment- LVR at 70%

Im looking for a -ve one now....i like the tax man:rolleyes:

Regards
Michael
 
Just updated my figures and it costs me around $140 p/w to hold approx 850k worth of what I hope are reasonably high growth assets. In my areas 15 year average is around 12-13% cg from memory. If that continues I hopefully should do OK.

I am also considering the possibility of second dwellings at present. Get my cashflow up and go again.

Thanks once again for this wonderful forum.

Slingshot
 
everything i buy is positive or neutral.

I bought one a month ago in sydney house which was 9% yield, and 50k under market val, and i havent seen it apart from the day I bought it and did no reno.

I reckon if I looked on re.com straight away I would find 50 properties with over 8% yield.

Just need to broaden your horizons.
 
Nathan said:
everything i buy is positive or neutral.

I bought one a month ago in sydney house which was 9% yield, and 50k under market val, and i havent seen it apart from the day I bought it and did no reno.

I reckon if I looked on re.com straight away I would find 50 properties with over 8% yield.

Just need to broaden your horizons.
Click to expand...

Impressive! so im guessing you buy in rural areas? and was this a "specialized" property ie student accommodation, commercial, service apartment?

and with such high yield, you reckon there will space for capital growth still?

Regards
Michael
 
Mick C said:
Impressive! so im guessing you buy in rural areas? and was this a "specialized" property ie student accommodation, commercial, service apartment?

and with such high yield, you reckon there will space for capital growth still?

Regards
Michael
Click to expand...

Hi Michael,

Def Sydney metro.

If it were regional I would be talking 10% easy with anything upto 20-50%'s.

I am talking, house + land normal rental PP $200,000 rents $320pw within sydney metro.

I always find 8%'s in sydney.... Capital growth is a must, if no upside then I wouldnt buy it.
 
Eric, you only have seven posts to your name, five of them in this thread. Now while that is not a crime, I do suggest you do a little hunting around the forum and do a search on some of the things that you are mentioning in this thread.

There are many experienced investors on this forum and while many will help out in anyway possible, you will find that you will gain more helpful information, and others open up to you much more, if you start to do a little research of your own.

There are positive geared properties around and Nathan is one shining example of someone who consistantly finds stuff, but he is not going to do the work for you.

Best thing you can do to educate yourself is to regularly read the forum AND contribute to the threads.
 
Last edited:
Well people come here expecting all the answers. But if people knew a great deal that makes plenty of money, why would they tell you and everybody else?
 
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