Hi Guys ,
I am a newbie here , so please don't critize too much .
We've inspected a property on Saturday .
Property is not too old (approx. 15 years) , 3/2/2/2 ( 2 cars garage) .
Price range $365-385K . I think vendor is ready to accept the offer around
370-375K .
Location is 5 min. walk to primary school , pre-school is 10 min. walk , 2 buses 150m and shoping centre is 1km away .
House needs aircon and renovation , I estimate the cost is 20-25K .
Total amount : up to 400K
To let: $335-345 p.w.
I can invest $100-130K cash in this property.
Income :
weekly rate $345
Agent commission 7%
effective weekly income $316
weeks in a year 52
weeks vacant 3
effective weeks 49
yearly income $15493
Expenses:
Loan amount $262,500
(I will pay 30% of the value plus $2,600 stamp duty ($15.120 stump duty - 12.5K FHOG) up front.
Interest rate 6.25% (projected)
Monthly P&I repayments $1,616
Yearly repayments $19,392
Landlord insurance $500
Maintenance $500
Council rates $1,200
Accountant fee $80
Yearly expense $21,672
Yearly cost $6,179
Negative gearing $6179 * 46.5% = $2,873
Effective cost $6,179 – $2,873 = $3,306 p.a.
Renovation (20-25K) Depreciation (30%) $7,500 .Total renovation cost $17,500
( initial investment) .
I am not sure how to calculate an annual depreciation , so I don't include it in my estimation .
I can offset morgage $30K -40K annualy , it means after 2 years :
$262,500 - $62,500 = $200K
Monthly P&I repayment $1213 X 12= $14556 p.a.
Capital gain in the area is around 5% p.a. I have an additional investment property abroad , however can't sell until 2012 .
We'd be able to sell the property after 3 years and to purchase the property within 10km radius from CBD .
Do you believe it's a viable investment and my calculations are correct?
Kind Regards
gprp
I am a newbie here , so please don't critize too much .
We've inspected a property on Saturday .
Property is not too old (approx. 15 years) , 3/2/2/2 ( 2 cars garage) .
Price range $365-385K . I think vendor is ready to accept the offer around
370-375K .
Location is 5 min. walk to primary school , pre-school is 10 min. walk , 2 buses 150m and shoping centre is 1km away .
House needs aircon and renovation , I estimate the cost is 20-25K .
Total amount : up to 400K
To let: $335-345 p.w.
I can invest $100-130K cash in this property.
Income :
weekly rate $345
Agent commission 7%
effective weekly income $316
weeks in a year 52
weeks vacant 3
effective weeks 49
yearly income $15493
Expenses:
Loan amount $262,500
(I will pay 30% of the value plus $2,600 stamp duty ($15.120 stump duty - 12.5K FHOG) up front.
Interest rate 6.25% (projected)
Monthly P&I repayments $1,616
Yearly repayments $19,392
Landlord insurance $500
Maintenance $500
Council rates $1,200
Accountant fee $80
Yearly expense $21,672
Yearly cost $6,179
Negative gearing $6179 * 46.5% = $2,873
Effective cost $6,179 – $2,873 = $3,306 p.a.
Renovation (20-25K) Depreciation (30%) $7,500 .Total renovation cost $17,500
( initial investment) .
I am not sure how to calculate an annual depreciation , so I don't include it in my estimation .
I can offset morgage $30K -40K annualy , it means after 2 years :
$262,500 - $62,500 = $200K
Monthly P&I repayment $1213 X 12= $14556 p.a.
Capital gain in the area is around 5% p.a. I have an additional investment property abroad , however can't sell until 2012 .
We'd be able to sell the property after 3 years and to purchase the property within 10km radius from CBD .
Do you believe it's a viable investment and my calculations are correct?
Kind Regards
gprp