Hi all,
I've been lurking for a while but finally gearing up to get my first IP and I've hit a snag budgeting.
Do people really find the 20-30% of rent as holding costs is a conservative enough estimate? I estimated a few numbers and I'm running upwards of 50% of rent in holding costs, assuming rental yield of 4%.
I've attached my spreadsheet but below are some of the figures.
Purchase Price - $600,000
Property Management 8% $2400
PM Small Expenses $250
Landlord insurance $750
Repairs 1%pa $6000
Water rates $750
Council rates $1200
MBF Levy $138
Body Corp $1200
Land Tax $475
Vacancy 10% $3000
Nil for cleaning, gardening, pests as this would be body corp or if no body corp, those funds will cover this.
I assume it is the vacancy and repairs that I'm overestimating is that right? What figures do others work with?
I've been lurking for a while but finally gearing up to get my first IP and I've hit a snag budgeting.
Do people really find the 20-30% of rent as holding costs is a conservative enough estimate? I estimated a few numbers and I'm running upwards of 50% of rent in holding costs, assuming rental yield of 4%.
I've attached my spreadsheet but below are some of the figures.
Purchase Price - $600,000
Property Management 8% $2400
PM Small Expenses $250
Landlord insurance $750
Repairs 1%pa $6000
Water rates $750
Council rates $1200
MBF Levy $138
Body Corp $1200
Land Tax $475
Vacancy 10% $3000
Nil for cleaning, gardening, pests as this would be body corp or if no body corp, those funds will cover this.
I assume it is the vacancy and repairs that I'm overestimating is that right? What figures do others work with?