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18/10/17
13:59
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Originally posted by Forged
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"that increase allowed folks to break even... unless you sell it and cash in"
More than break even. Profit guaranteed. With 5% interest on $500k house is only $25k/y interest. Over 10 years, is only $250k interest. That particular VIC/NSW property has doubled to $1 mil. You still make $250k over 10 years.
Oh I forgot,
-The tennant pays the rent, it covers the interest & the loan. Investors pay NIL.
-Investors pay less tax after claiming negative gearing, or they can enjoy the profit if they are positively geared, then they can buy so called designer jeans, iphone, macbook, etc for FREE. It's a win-win.
-Investors can also claim for depreciation, agent fee, etc. Another less tax to pay.
-After 25-30 years, investors can finally fully owned their rental properties paid by the renters over the years. They can either pass it on to their children, or cash in retire with a lot of money, or buy hypotetically a so called "super car" or "Royal" holiday. Your choice.
-Renters pay full tax to the government, nothing to claim. Only occassional dodgy sickies
-Assets make you rich, money doesn't. The more money you make, the more you'll spend. Robert Kiyosaky.
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I'm not denying you can make it work and that yes you can offset the cost, but most negatively gear anyway to gain tax benefits. Also too that's not how you calculate bank interest... its a notional 5% on the remainder of outstanding debt compounded monthly, plus fees.... which is why its not 25K over ten years it's closer to 125K interest + fees.