"UT,so would you say buying at today's prices isnt worth it.? If you have to tip in $50 a week of your own money,and your not going to get any capital growth,why would you bother."
That is not what I said. I stated that at $150k the rent wouldn't cover all the expenses currently. Tipping in $50 or so a week may not be such a big deal for a particular investor as they will likely get 30 to 40% back in tax reducing the overall loss. Secondly the rent will be increasing (assume in line with inflation) which means sometime in the future 5 to 10 years the property will be neutrally/positively geared. As for why you would bother without capital growth well after that 5 or so years the property costs you effectively nothing and is paying for itself. At the end of the day you then end up with a nice income stream and you own an asset outright which you wouldn't have otherwise. The other thing is I don't count on capital gains to make my strategy work but strongly believe I will get them sometime over the next 20 to 30 years as my investment areas transform to better areas.
As for the capital gains being taxed well you are assuming I have an intention to sell at sometime in the future which I don't. If I need access to money assuming the asset has appreciated in value it can be borrowed against for other value adding purposes.
