Today the Australian Reserve Bank announced they will cut interest rates by a whole 1%.

This is the first time I have ever seen interest rates this low in my life. I guess my thoughts on this is both positive and negative. Positive in the sense I will be paying less interest each month. The increase of my cash flow is also good, meaning less of personal money is used to sustain these investments.

However negative in terms this will make housing more affordable and rentals less attractive.

However as an property investor it also gives me more reasons to re-enter the market to buy another property. Prices are relatively low and to service the loans are now even more affordable.

So this year my main goal is to find another investment property.

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Have you ever wondered the costs of actually owning a property? Here the major costs that I incurr on my properties.

1. Finance - This include any interests and fees that is incurred with a financial institution to finance the purchase.
   
2. Council Rates
   
3. Body Corporate (Strata Properties)
4. Management Fees - I currently have property managers looking after and handling any issues relating to the management of the property. Generally they can cost between 7-8% of the total rental.
5. Repairs - Generally there will be small repairs that is required to be upkeep and maintain the property each year.
6. Inspection Fees

As my properties are investments all the above costs and expenses are tax deductible, which helps soften the blow of owning an investment property.

All the above annual expenses should always be part of your budget and plans when you purchase a property. You may be able to afford this today but can you afford it next year or next month. So careful planning is necessary.

However as you pay off debt, and combination of capital growth and rental return, property is well worth the investment.

property experiment, ramblings | 0 comments »

I thought it was about time I added to my list of Money Making Experiments my Property portfolio.

I started investing into property when I was just 21, however only recently have I actively seek to increase the number of properties in my portfolio. In the beginning I thought it was a burden and constantly worried about it. Also it didnt help when all my friends were telling me that I was crazy, you have a ball and chain and you won't get to travel. Well how wrong were they, I have traveled the world, I have traveled on 4 continents America, Europe, Asia and Australsia, because I learnt how to save money.

I currently own two properties in my home town of Brisbane (Living in Sydney, Australia). Owning property has given me more than profits, it has taught me how to save money, budget, management, negotiation skills and financial IQ.

Goal
Build a property portfolio to produce passive income of over 100K a year through rentals.

Short Term Goal

• To acquire a 3rd Property in 2009.

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