SA Hype Davoren Park, Adelaide

And in Adelaide you can....the vacancy rate is low.

I just put up my rents..and one of the properties the tenant chased the agent to renew the lease...go figure...that was the one in Holden Hill.

 

I managed to snatch 1 about 2 years ago for $165k house and land package. $30k turn key and after getting construction grant of $8,500 straight into offset account and renting for $275 to 1 tenant until now. I think I might've gotten a good bait.

 

wow 346k. thanks for increasing the value of playford.

 

Why on earth would anyone?

 

very true. Even with the recently announced 50bn submarine deal, this statement still holds good.

 

while i do not agree with ALP negative gearing policy, i can tell you the Libs have been no friend to the northern suburbs of Adelaide!

 

We've had ALP in for over a decade here.
A lot of the infrastructure we've been getting in the north is federal rather than state funding, so not exactly what you mean?

 

Not really wanting to turn this thread political, but my gripe has more to do with the way they treated a certain industry (car manufacturing) based on what i believe to be mostly political/class bias, not one of economics.

 

Disappointing Holden is closing but the question is how much government money should be used to prop up uncompetitive industries? Small business owners don't have this luxury.
Plenty of promise in the defence/technology contracting field where Adelaide can become a major regional hub.

 

I do agree with it. What benefit is there to anyone else by us being allowed to negatively gear existing properties? It's bad for owner occupiers and obviously for taxation. I think it would not increase rents dramatically if it had never been around. As a percentage yes, but not in dollar terms.
Also, we all know that depreciation is a wrought. I don't see any reason why investors shouldn't be carrying the costs of this, rather than the tax payer.

Yes, obviously I use depreciation and negative gearing, but I don't think that the tax payer is getting good value out of these policies.

 

Its losing a heap of money, tax payers will be better off when we don't have to prop it up anymore.

 

Not directly, but by subsidizing large industry it than has a multiplying effect into the economy trickling down to small business. (There will be an impact to small business in the north from Holden closure). As removing the industry will now have a multiplying effect in the opposite direction. Lets say i agree and say the long term future for car manufacturing is not feasible, and hey it probably isn't, i think there should have been a far better process of transition put in place. Joe Hockey standing in parliament and goading/daring Holden's to close up was far from professional and a poor way to treat an international company that has delivered so much to this country.

Every modern economy has in place subsidized industries, its about having these subsidies used as efficiently as possible. Our car manufacturing industry was highly efficient as our subsidy per capita paled in comparison to other western car manufacturers. The British government realized that the collapse of there car industry was a huge mistake and have turned around 180 on the idea and are now supporting the industry which has proved to be a success.

Putting aside opinion for/against manufacturing cars, i believe that the mining boom was a double edged sword .While mining is a crucial foundation to our economy it created a comfortable/lazy economic policy environment, since the formation of the Howard gov to the current. I believe we suffered somewhat of a "dutch disease" effect because of it. My fear is if we don't value add to our raw product and manufacture there will be a broken link in the economy. Hope to be proven wrong

 

Speaking of depreciation....

Just went over my software and added these figures into the calculator. So the house purchased for 217k, plus other costs. Minus all expenses, gives 730 cash flow positive a year at 3.99%
Plus 2600 in depreciation.

This house makes me $3,330 per year at today's rates.

No growth as yet. It will come.

 

Wash your mouth out Spludgey, just because your 8-9% yielding places in Elizabeth are not even close to being negatively geared.

 

Yes that's a slightly different point which I agree with.
Both sides of politics and both state and federal governments are to blame because of their inaction over the last decade.

 

Not quite, you can't add depreciation to your positive cash flow, as it's only applicable at your marginal rate, plus you have to pay for it if you ever sell in terms of capital gains tax.

 

Why not? If I didn't have the property then 2600 would have gone to tax. Now legally, I get it back into my pocket.

 

No, if you hadn't had the property, you would have had to pay tax on $2600, not tax of $2600. So it would have roughly been a third of that (making assumptions about your income).

 

Probably agree with you on depreciation, not so sure on the tax payer not getting value for money on the negative gearing. Speaking from my own personal situation my goal is to retire early. Property along with investment in equities is how i am hopping to achieve this. when i retire if all goes to plan i hope not be receiving any form of gov pension. (I do not wish to be a burden on the tax payer when this time comes).

I do not have any form of higher education/qualifications (My own fault) and as such have never had a job that pays much above the minimum wage. Negative gearing gave me a huge leg up to get into property, i am now in a position of being well and truly positive geared (much to the dismay of my accountant). While i have not crunched the numbers maybe your right?, but my gut feeling is the tax payer will more than make this money back when i retire.

 

Gotta say this confuses me.
I used Margaret lomas's destiny software with all wages, taxes, costs, interest, depreciation etc into the calculator, it came up with $64/week, 3330 per year cashflow positive.