Just Did a Deal for IP4 as well

[BayView]

Are you taking into account RE management fees + costs, council rates, insurance, maintenance, bank fees, etc. All this usually adds 2% pa of the value of the property. Not to mention rising interest rates.

How can you be buying for yield when its neg geared? And you should say growth might happen when the high school opens, not will. Nothing is definite, espcially cap growth in the short/med term. I can only see Ippy growing with a national price growth and that will be quite a long way off.

Doesn't add up for me, all the best with it.

I'm with Ev;

Do we know how much cash input (not other equity) there has been in the purchase?

Assuming there is a 20% deposit plus costs - all cash, which leaves an 80% loan at 7% of $264k, then the IO repayments will be $355 p/w.

If the rent is $400 p/w, and the holding costs of around 20% ($80) are deducted, then it is neg geared by $35 per week, not including depreciation and tax returns to be added back. 20% holding costs covers ALL outgoings, and includes 2 weeks vacancy each year.

If the whole purchase was done with other equity borrowings plus a new loan for the balance, then it is very doubtful that it is pos cahflowed.

Nevertheless, well done and good luck.