Hi
I'm planning to put my place for rent and currently paying mortgage.
How much of the mortgage or interest, body corporate, rates a property should pay itself to he considered a good return?
Investment Property - What Is Considered A Good Return?
newbiesh on 28/10/2018 - 01:46
Last edited 28/10/2018 - 10:20 by 1 other user
Last edited 28/10/2018 - 10:20 by 1 other user
Comments
Investors look at a couple of things; likely capital growth and stable rental income.
In the current market, growth will be difficult in the short term, many analyst aren't expecting any reasonable growth overall until at least 2020/21. So stable rental income is what you are looking for.
Anyway, negative gearing may be your friend in the first few years of your property, so have a look at this thread, it might help
Hey mate good info thanks
What if i sell it next year and With current market i actually make a loss.
Would it be capital loss tax deduction?I personally have not made a capital loss so I never had any first hand experience or advice/information from my accountant.
That said, you said you were going to "my place for rent" …. you may be subject to the six year primary place of residence rule - so gains or losses - may not be counted.
Anyway there are many variables, and that without us knowing it all, won't be able to give you some idea - so best if you speak to an accountant.
Depends on what rent you can get compared to the interest cost. They are the big ticket items. Body corporate is relatively fixed (that is, you can't really do much about it). Next biggies are agent commission, council rates and maintenance (if it's a house) and insurance.
Anything positive to 0
Depends on purchase cost, where and what type of property.
In Sydney or Melbourne, gross yields under 4% for units and 3% for houses aren't unusual. Generally the more expensive properties get lower yield too. Other cities without the crazy recent increases, over 5% is possible.
Depends on your expectation. But when buying in this market, getting a blue chip property on a neutral return is quite an achievement.