I have had a question from a person who wanted to use equity in his home in Emerald, Queensland to start a to-purchase-an-investment-property/”>residential property portfolio. He realises that his home is now only worth half of what is was 5 years ago but was surprised when his loan application was declined because the bank would only lend 70% instead of his anticipated 90%.
Many of my clients are now in this situation. If a client and partner have a combined amount of $220,000 in Super, and combined salary of $110,000 plus per annum, I can arrange the set up of a Self Managed Super Fund (SMSF) and start their portfolio with a magnificent 5-bedroom executive home at North Harbour Brisbane.
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Principal and Interest or Interest Only
Sample figures
This is based on a Turn Key House for $530,000 at North Harbour with direct access to Brisbane Airport.
What I mean by ‘Turn Key’ is that everything is completed – carpets, curtains, landscaping etc. Just ‘turn the key’ and start living.
Figures are as follows:
Rent per week – $490 – $500
Combined Super $220,000
Combined Salary per annum $110,000
Initial Outlay – $3,000
Monthly contribution $NOTHING!!!!!
Now let’s get this straight. If a client, with their partner, have a combined $220,000 in their Super and a combined salary of $110,000 per annum they only have to outlay an initial $3,000, I arrange setting up the Self Managed Super Fund, arrange the builder, the property manager, legal’s and finance and it costs them NOTHING to pay it off Principal and Interest? Yes, I know it sounds too good to be true.
However, I have been looking after clients across Australia for 40 years and yes, building a property portfolio through a Self Managed Super Fund is a complicated process but my office makes it easy.
Is there a separate land and build contract as you do for conventional property investments. No, a Self Managed Super Fund investing in residential real estate can only purchase a completed property.
So what makes my homes so special?
Location, location, location! – Solid growth quality area with direct access to Brisbane Airport, the same quality finishes that we use in the Mater prize homes we build, built to cyclone rating and with permanent termite protection.
Please contact our office to schedule a free, no-obligation consultation and find out if our service is suitable to your needs.
If you prefer to listen here is my radio interview on Emerald 4HI:
Steve Taylor
DISCLAIMER
Steve Taylor & Partners blog is opinion and not advice. Readers should seek their own professional advice on the subject being discussed.