Sure you are making some $$ far but far less than you could...

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nippy

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16/06/24

16:54

Post #: 74339158
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Originally posted by rona142: ↑

I bought my first property off the plan in 2015 for $550k (we paid zero stamp duty and also got a FHOG of $15k so effective purchase price of $535k). We paid a 10% depoist upfront and nothing else was required to handover of the property. Settlement happened in June 2017 which is when we borrowed $400k @ 3.98%. From then until we sold the property mid 2023 rates dropped progressively to 2.34%. By the time we sold for $830k we owned the property outright. The proceeds of sale was $815k taking into account legal fees and agents commission.

Over the life of the loan we would have paid less than $50k collectively in interest which still leaves us massively in front. Lets call purchase price plus interest $585k we still walked away $230k infront. When we first moved in our neighbours were paying ~$500/week in rent and by the time we left they were up to $650/week. Lets call it an average of $575/week for rent for them over the 6 years.

Rental costs for 6 years = $179,400 vs less than $50k in interest plus I walk away with an extra $230k in capital gains in my pocket.

We now have a bigger property and our monthly interest for the homeloan averages $550/week. To rent the same property it'd cost $1000/week. Again we're making accelerated repayment so we'll likely own it outright within 10 years even if interest rates stay where they are now.

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Sure you are making some $$ far but far less than you could have.

Thats my point.

With an emotive partner in tow well done as they mostly do not cope with the more variable returns and no nest.
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