How much are you paying per month / year to hold your IP's?
- Thread starter LoneWolf
- Start date
Nothing, mine are positive.
Whether 10-20k PA is a lot depends on how many that is split over, and whether your equity gains are dwarfing that.
Based on more than 3
It's all relative. If it was for multiple IPs in high growth areas then I wouldn't think it was too bad.
Mine are all neutral now so as long as tenants keep paying rent, they don't cost me too much much to hold. Just the odd headache every now and then.
Cheers
Jamie
IP's are positive.
PPOR has been 100k+ PA holding costs for almost 2 years since we've had it, how's that for doing things backwards....
PPOR has been 100k+ PA holding costs for almost 2 years since we've had it, how's that for doing things backwards....
Approx 5k for 3 properties.
$10-$20k for 3 properties is not excessive if in a capital city or high growth area.
$10-$20k for 3 properties is not excessive if in a capital city or high growth area.
If depreciation come into play, it would be +- cash neutral
Mine pay me. Cf+
$10-$20k per annum is a heavy cross to bear for most folks. If you added in things such as "a new baby is now expected in our home, so household costs will increase and my wife/partner will not be working for a fair while", or a job loss, or a vacancy in an IP, or an increase in interest rates, suddenly, on the average income, that $10-$20k per annum suddenly goes to a much higher and unmanageable figure.
Unmanageable circumstances are what force people to sell property quickly at inconvenient times. This is how to lose money.
Tread carefully. Mortgages are for 25-30 years. You might want to enjoy life on one or two occasions along the way.
Unmanageable circumstances are what force people to sell property quickly at inconvenient times. This is how to lose money.
Tread carefully. Mortgages are for 25-30 years. You might want to enjoy life on one or two occasions along the way.
Costs are covered by income, and then some. For the long-term buy and hold, providing that the long-term CG is, say, 15-25% over the holding costs, I'd be happy. One rider is that the holding costs should be manageable. If all income is from property and property costs exceed income, then there will be problems. Each case needs to be assessed on merits.
What happens when interest rates go up?
hi dejackal,
There is a correlation between interest rate rises and rent rises. I will have a look to see if I can find some data.
This is not always the case.
I only just started investing early last year and my 1st IP is neg at around $4-5k pa at 107% lend. With tax deductions from depreciation its neutral, but only for the first couple of years as depreciation value falls off which also means less tax deductability. However it wont be long before i refinance it to 90% lend and then it should be neutral-positive again. My 2nd IP is at 90% lend and is neutral - slightly positive even without tax deductions. So all in all I guess you can say I am paying nothing to hold so far.
Property Cost
Just finalized Accounts for 13/14 tax yr ready for the accountant. Out of pocket costs for 7 I.P's was $587. This included a $2,500K trip to Adelaide to see our I.P, $2k on new office furniture and $1,700 for purchase costs on a property that we tried to buy but it feel through. We have a mix of of capital growth and country properties.
Cheers Bullfrog
Just finalized Accounts for 13/14 tax yr ready for the accountant. Out of pocket costs for 7 I.P's was $587. This included a $2,500K trip to Adelaide to see our I.P, $2k on new office furniture and $1,700 for purchase costs on a property that we tried to buy but it feel through. We have a mix of of capital growth and country properties.
Cheers Bullfrog
Similar threads
- Poll
