SA Hype Davoren Park, Adelaide

Discussion in 'Where to Buy' started by Barny, 26th Apr, 2016.

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  1. spludgey

    spludgey Well-Known Member

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    It seems that you're in the minority then. According to the figures in the news, most people that negatively gear have fairly well paying jobs.
    Personally, I have an okay paying job, so even if I wasn't investing in any way, I should have enough money in my super as to not qualify for a pension at age 70.

    But congrats on building a positively geared portfolio on not much more than minimum wage!

    I don't know about the software, but here is an example.
    Let's say you make $100,000 a year and have $10,000 of depreciation/deductions, this then means that your effective income is $90,000 and you don't pay tax on the $10,000. Assuming that the tax rate is 38% at this level (I think it is, from memory), you actually save 38% of $10,000 or $3,800.
    The downside of this is that I believe that your deductions get added onto the selling price when you end up selling and you effectively pay half of it back (assuming same tax bracket and 50% marginal CGT)
     
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  2. Barny

    Barny Well-Known Member

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    Thanks spludgey. Using your example above, that's $3800 additional money you now have because you could lower your income with deductions?
     
  3. HUGH72

    HUGH72 Well-Known Member

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    Hard to comment further without all the figures but the depreciation just reduces your income on which tax is payable at your marginal rate.
     
  4. spludgey

    spludgey Well-Known Member

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    Correct.
     
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  5. Barny

    Barny Well-Known Member

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    The $2600 was additional money I now have after lowering my taxable income with this house. The $730 is pure cashflow.

    So total of $3330 better off having the house.
     
  6. ollidrac nosaj

    ollidrac nosaj Well-Known Member

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    I think this is a good point , and reminds me of a Noam Chomsky quote "In western economies the poor subsidize the rich". I acknowledge there is definitely some of that going on with negative gearing.

    I definitely like the idea of negative gearing applied to new housing, i built a new investment property a few years ago, and the major decision to do so was not depreciation. Firstly i wanted everything new as to not worry about maintenance issues for the foreseeable future. Secondly i liked the feeling of contributing back to the economy in the form of creating work.

    I also like the concept of negative gearing applied to investment in equities, as this also has positive flow on effects for Business/economy. Maybe a more sensible policy might be capping rather than eliminating?

    I understand everyone has different philosophies when it come to money and wealth, mine is a take what you need, not what you want. I totally agree that buying and gearing your fifteenth property may be taking the **** out of the tax payer. I also like to think not in all cases, as i also like to think someone in that situation also has great capacity to contribute back to society.
     
  7. D.T.

    D.T. Specialist Property Manager Business Member

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    This thread is meant to be about a certain suburb, not a communism convention.
     
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  8. ollidrac nosaj

    ollidrac nosaj Well-Known Member

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    In what way is anything mentioned above remotely communist in principle?!!
     
  9. C-mac

    C-mac Well-Known Member

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    Soooo... back on point to Daveron Park, it has probably been covered earlier in this thread but what employment prospects are there for renters living in this area.

    (Please, no smart alecs replying 'Centrelink!' to this one! I'd like a legitimate answer to a legitimate question hehehe)
     
  10. TMNT

    TMNT Well-Known Member

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    Boganlink
    Boganlink
     
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  11. D.T.

    D.T. Specialist Property Manager Business Member

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    Nearby Playford Alive will provide some employment options I suppose. The typical resident wouldn't care.
     
  12. Barny

    Barny Well-Known Member

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    Taken from localstats.com.au

    main occupations of people living in Davoren Park are 24.4% Labourers, 17.3% Machinery operators & drivers, 14.0% Technicians & trades workers, 11.8% Community & personal service workers, 10.3% Sales workers, 9.5% Clerical & administrative workers, 5.7% Professionals, 4.3% Managers, 2.7% Occupation inadequately described/ Not stated.

    The main industries people from Davoren Park work in are 20.7% Manufacturing, 12.9% Retail trade, 11.9% Health care and social assistance, 8.3% Transport, postal and warehousing, 6.5% Administrative and support services, 6.1% Construction, 5.8% Accommodation and food services, 4.9% Public administration and safety, 4.7% Wholesale trade.

    15.9% of homes are fully owned, and 28.8% are in the process of being purchased by home loan mortgage. 50.8% of homes are rented.

    The median individual income is $359 per week and the median household income is $688 per week.

    The median rent in Davoren Park is $185 per week and the median mortgage repayment is $1083 per month.
     
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  13. ollidrac nosaj

    ollidrac nosaj Well-Known Member

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    Ouch! :eek:
     
  14. C-mac

    C-mac Well-Known Member

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    Thanks for the share. Wow incomes are pretty low. But then, servicing a $185pw rent off of a $688 household income isn't too unrealistic either.
     
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  15. Barny

    Barny Well-Known Member

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    Not at all.
    You can buy houses for 140k here. People are buying houses in other suburbs medians over a million, with less than 1500 house hold income.
     
  16. ollidrac nosaj

    ollidrac nosaj Well-Known Member

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    Good point, i guess its all about serviceability. but i still stand by my original post :eek::)
     
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  17. MTR

    MTR Well-Known Member

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    similar momentum to Tas?

    I guess this also rang true for Perth until the mining boom came along in 2001.

    I believe many investors missed out on making a killing in Perth during this period due to their prejudices/bias

    Still need strong fundamentals for momentum to change, ie strong economy, jobs, immigration etc
     
  18. househuntn

    househuntn Well-Known Member

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    Try Broadmeadows. Single weekly $325, though household is higher at 746. Not gonna improve any time soon with the Ford factory closing...
     
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  19. 2FAST4U

    2FAST4U Well-Known Member

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    Holden factory...
     
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  20. Barny

    Barny Well-Known Member

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    Adelaide needs some serious job growth to improve the whole state. I don't believe Holden closing will be a major issue for davoren park though.
     

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