How Much Cash Flow Do You Generate Today???

Discussion in 'Investment Strategy' started by MTR, 29th Jun, 2017.

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  1. icic

    icic Well-Known Member

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    You guys are my inspiration!
    I would love be at where some are at now, but I am happy if I am half way there. The first batch of IPs doubled and are waiting for the second batch to do its magic, I am hoping within the next 3-5 years. Its still cf- as i have been accumulating agressively for the last 3 years. My retirement plan is 10 yrs at the age of 45. All I need is one cycle in Qld and another on in Sydney within that time frame.
    Still working on my exit strategy to convert the asset into passive income, but I don't think it needs to be set for another 5 years. Having 2 young kids doesn't help with cf and need to keep track of risk and budgeting. While I like property for its protentials, I don't want too many that it becomes a heavy burden to manage. For my retirement, I can imagine spending my time doing creative things such as photography, writing a book or coding apps from my own ideas and not some one elses. To add to that, would be my dream to do it in a different city somewhere around the world every few months. Not sure about the logistics of having two school age kids. Hopefully lots will change in techology and schools in the near future to make it a reality.
     
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  2. MTR

    MTR Well-Known Member

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    Sounds brilliant

    Just a suggestion, any chance of adding value to any of your properties to increase cash flow ie develop, renovate.
     
  3. icic

    icic Well-Known Member

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    Thanks for the reply MTR.

    I have half of a farm in Sydney's South West which will likely to be zoned for residential development in the next 5-10 years. Another house in Queensland already zoned for 7-10 levels residential. The farm in Sydney has already tripled in value in the last few years so not sure how much further it could go.

    Both are rented out right now so its not too much of a burden.

    Hopefully those two will be pots of gold that will push me over the line. In the meantime I will just keep investing and hopeful we will achieve our goal even if development or zoning does not eventuate in time.
     
    Last edited: 17th Jul, 2017
  4. icic

    icic Well-Known Member

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    Nice one! $120k p/a is a decent amount to retire on I could imagine. Maybe I have low expectations, but I will be happy with that!
     
  5. Zoolander

    Zoolander Well-Known Member

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    Negative a couple of G's before depreciation, tax return and taking into account salary. Transitioning an IP to PPOR added a dimple to the cashflow cojones. Got a ways to go before raking in massive cashflow like @scientist here.
     
  6. MTR

    MTR Well-Known Member

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    I wonder what would happen if investors focused on cash flow today and how to increase this today, rather than the future. Would investors achieve a better outcome? Thoughts



    MTR:)
     
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  7. rogerG

    rogerG Well-Known Member

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    Brilliant Thread MTR. Kudos!! Just so much information for a starter like myself. No dream is too big or too far.
     
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  8. Aireys

    Aireys Member

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    MTR - I notice you're very active on 'property chat' - enjoying your comments, threads, questions and input! Would love to hear more about your story/journey/background. Have you written anything for the investors showcase thread by any chance? Feel like I'm working in a sheltered workshop/an episode of 'Utopia' myself! Dreaming (and making small steps) towards a different life!
     
  9. MTR

    MTR Well-Known Member

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    I think I have written too much:p
     
    Last edited: 26th Aug, 2017
  10. Hwangers

    Hwangers Well-Known Member

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    this thread is very inspirational, whenever I lose focus I come back to this thread and smile because I get back on track immediately - thanks for sharing
     
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  11. MelbMax

    MelbMax New Member

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    About $500k the last FY, currently at $20k/month for the last few months. We run a Youtube channel - highly lucrative but prone to revenue volatility. Looking to invest in Vic regional properties, aiming for the first 2 purchases this year. Prefer to buy without finance, looking for a gross yield of 7-8%, strictly CF+.

    Long term investment goal (5 yr) is 10+ CF+ properties with gross income at $70k-$80k. This would provide a nice secondary revenue stream.

    Have spent the last 2 weeks reading this forum and getting across the current state of the property market. The above strategy may be modified based on further research. Currently, I'm leaning towards properties in the sub 150k range - 2-3 bedroom detached homes or units in regional centres yielding high % rents.
     
  12. MTR

    MTR Well-Known Member

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    Great income from business, can you share more?
     
  13. Dean Collins

    Dean Collins Well-Known Member

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    About -10k pa.....with our 4 Sydney IP's but we are happy with servicing that as each year in addition to paying down debt at about 60k pa.

    But basically due to current govt taxation decisions toward expats living and working overseas we have zero interest in purchasing any further IP's in Australia as can make more on our money through other investments elsewhere (putting about $100k pa into USA equities).
     
  14. CTSB

    CTSB Well-Known Member

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    I've got a lot to learn from quite a few in here with regards to structuring for cashflow.

    Recently been married and at 29 have to make the right decision as to what to do next.

    Current combined annual income is around $230k.

    Have a PPOR worth $1.4m, LVR sitting at about 40%, IP $1.2m LVR sitting at 58% both is SE Melbourne

    PPOR is on P&I which is currently killing cashflow atm, waiting until December for revalue/refinance over to IO to avoid broker clawback. I will try and draw out $560k in equity into the offset of PPOR.

    IP has town planning permit imminent for high end dual-occ development, which may bump up it's value by around $100k. Decisions need to be made to do this development myself (Never used construction finance and unsure of its pitfall etc (Im a carpenter by trade (without license) and work in commercial construction management) vs selling the IP with approved plans and permits, pocket the money and reinvest. Should pocket around $500k post CGT payments on the IP if we decide this route.


    Have wanted to move down the commercial property route for a while for cashflow purposes, but unsure as to weather I have the equity built at the moment to achieve it (Equity in real terms sitting at around $1.3m)

    Plans are getting drawn up for a 5 x high end apartment development on PPOR, plans potentially to sell up both PPOR and IP and reinvest elsehwere.

    I'm probably in need of a quality financial planner/better accountant, anyone recommend someone in melbourne (or anywhere really) for investment strategies for something like this, like most in this thread im hoping to aim for $150k passive income in the next 10 years.
     
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  15. MTR

    MTR Well-Known Member

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    @Terry_w have you read his posts/tips ?
     
  16. MTR

    MTR Well-Known Member

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    I am kind of done with the Aussie property market for the moment, I just don't see any value or markets that I want to jump into. Not saying you wont find some great opportunities, just not for me.

    This is how I have been increasing my cash flow ...... in recent months

    I have been going hard in US market and since December 2017 adding an additional 7 properties to my portfolio. Here are the numbers on these recent purchases

    $413,000 USD, has given me $58,777 net return
    Average net yields from 9% to 15%

    How I work out net figures is simply taking 40% off gross income, my tax returns are coming in at round these figures. Lots more slippage in US.

    I intend to continue buying in US I simply cant get these yields in Australia. The bonus is the market is rising very quickly.
     
    Last edited: 13th May, 2018
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  17. Harry30

    Harry30 Well-Known Member

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    Yep, I have old houses on big blocks in major capital cities. Nice CG, but yield barely 1.5%. Means and I ain’t driving a Ferrari.
     
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  18. Harry30

    Harry30 Well-Known Member

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    And that is gross yield BTW. Non interest expenses running at 39%, so net yield before interest ~0.9%. Been taking a cut lunch to work for the last 10 years.
     
  19. MTR

    MTR Well-Known Member

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    That sucks
    Thing is markets now softening, investors can not rely on growth moving forward

    MTR
     
  20. Greyghost

    Greyghost Well-Known Member

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    Question if I may.
    Why are you looking to invest regional?
    Why cash only purchase?
    If it due to financing issues due to your industry?
    What would the outcome look like if you worked out the break even on the rent obtained via using cash deposit and financing the balance.
    Surely if you are seeking 10 years in the market leveraging your available cash across a larger asset base would achieve an exponential amount more of equity?
    Otherwise I feel if the regionals don't perform (Mildura etc), then buy paying cash you are simply 'buying' rent. Kind of like an assessable annuity you will be paying tax on, using money (from your business) you have already paid tax on!
    Forgive me if I have not understood your strategy completely
     
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