During Money Smart Week every investment property owner wants to hear good news about the proportion of their income that will be required to meet loan repayments.
The latest Adelaide Bank and REIA Housing Affordability report shows that housing affordability has improved over the past two years, with the proportion of income required to meet repayments at 28.7%. This is the lowest recorded drop since the June quarter of 2003.
This is in part due to the low interest rates set by the Reserve Bank of Australia, which remained unchanged this week at a historical low of 2.5%.
Variable interest rates have also declined 0.2 percentage points from 6.1% to 5.9% in the June quarter, which is a decrease of 0.7 percentage points compared with the same time last year.
While we’re on the subject of how much money is required to meet loan repayments, if you’re considering purchasing a new investment property – why not also make a smarter investment choice by requesting a tax depreciation schedule for your property?
Claiming depreciation can make a significant difference to the available cash flow. The money claimed can also assist you with loan repayments. Make sure you crunch the numbers and get an estimate of how much depreciation deductions you can claim.
Read more: Crunch the numbers and save