Do I need more Equity ?

From: Brett Charlton


I have about $100,000.00 equity in our home worth about $270,000.00 in Brisbane.
How much equity do I need to buy my first IP ?

BrettC
 
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Reply: 1
From: Rolf Latham


Hi Brett

If you have 100 000 k accesible equity and a good serviceable income then you can purchase an IP of say 250 k , perhaps even more, depending on your income

Ta

Rolf
 
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Reply: 1.1
From: Brett Charlton


Rolf,

I will have an Income this year of around $45,000.00.
I have no other debts ie Car loans/Credit Card debts.

Brett C
 
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Reply: 1.1.1
From: Lotana Von Amor


I am not trying to hijack the thread, but I would say if you can comfortably spend one third of your gross income on interest repayments, and assuming rental return of 7%, interest rate of 6%, interest only loan, $10K costs, and no outgoings you should be able to afford $222K worth of investment property.

Regards,

Lotana
 
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Reply: 1.1.1.1
From: Rolf Latham


HI Lotana

I would put it into that sort of ball park too. I can tell youre not from Sydney though. 7 % return, most Sydneysiders would salivate at 5 %.

So Brett, you do not need more equity.

ta

Rolf
 
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Reply: 1.1.1.1.1.1
From: Lotana Von Amor


Well, I think I am from Sydney. But Brett is from QLD so I assumed a more attractive return...

Cheers,

Lotana
 
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Reply: 1.1.1.1.1.1.1
From: Brett Charlton


Thank you for your feedback everyone !!I am relatively new to Property Investment and need to learn HEAPS more yet.
I have just subscribed to API magazine and am currently reading Jan Somers new book.
Hopefully my knowledge will increase enough to make a wise decision on my first IP.

Regards,

Brett
 
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