Can You Still Get Positive Cashflow Properties
Some people believe that the days of doing well through property investing in Australia have been and gone. The opportunity has past, and would-be- investors may as well give up before they even start.
I’m here to tell you that this is a myth!
You can still find incredible investment opportunities in Australia, including positive cashflow properties. They’re not unicorns – they’re real! They do exist. You just have to know what you’re doing, where to look, and how to set it all up.
Know the Factors
The first thing you should know is that rent is only one part of the equation. There are nine factors that influence whether a property will be positive or negative cashflow. This means that a property that seems to have great rental yield might not be such a good option, while another property that has lower rental yield can actually be positive cashflow.
You have to know the factors so that you can identify a property that can pay for itself. I’ve talked about these factors in depth in another post, so I’ll just touch on them here. They are:
- Tax return
- Loan repayments
- Body corporate fees
- Rental management fees
- Council rates
If you work on increasing the first three factors, and minimising the next six, you’ll be well on your way to a positive cashflow property.
Don’t Go Commercial
A lot of people who don’t know what factors to look for (other than rental yield) will often start looking into commercial property, as the rents can seem pretty attractive. However, one problem with commercial is that banks will only lend you about 60%, instead of 90% for residential. In addition, commercial comes with many other issues like high vacancy rates that are going to each into your cashflow.
So, don’t go commercial. You can get positive cashflow residential properties if you know what you’re doing.
My team and I only present properties to our clients that are positive cashflow. And these are properties that we find in the best investment locations around the country. I know firsthand that they exist because I see them every day.
Here’s why we believe this is so important: you can only own a limited number of negative cashflow properties before your disposable income runs dry. But you can grow your portfolio with an infinite number of positive cashflow properties because they pay for themselves!
If you’re interested in these kinds of opportunities, get in touch and we will help you get into those properties.
Daimien J Patterson
Daimien Patterson is the CEO of Integrity Investment Properties, a property investment company based in Australia. He regularly produces books, blogs, and videos on the topic of property investing. Head to [integrityinvestmentproperties.com.au] for your free copy of Daimien’s book, Safe as Houses.