A Real Estate Cash Flow Cash Cow
Ever wondered what it would be like to own a real estate investment that actually pays you to own it?
Ever wondered what it would be like to own that positive cash flow real estate investment in a blue-chip Melbourne suburb?
Well before you start calling me mad, the fact is these opportunities, while rare, do exist and UGC clients are taking advantage of one such rare opportunity right now.
The Gill is an inner-city development located in Essendon. It consists of 73 apartments and is located just off Keilor Road.
Within this six-level development there is a selection of 1 and 2 bedroom apartments each expressing what living in Essendon is all about; lifestyle, culture, creativity and flexibility.
The development will also have a ground level restaurant and space for 4 retail shops. There are 2 levels of secure underground car parking with visitors car parking also provided.
Each apartment will come with a car space and storage cage. There will be a fully integrated air-conditioning unit, Smeg and Bosch appliances, stone benchtops and Japanese Finger tiles for splash backs in the kitchen and engineered timber floors throughout the living area.
The development also features a secure courtyard for use by residents only. The developers have worked closely with their architects to ensure attention to detail has not been spared, from the beautiful foyer through to the look of the corridors and entries to each apartment.
So how does such a property selling in today’s market end up paying you a substantial sum of money AFTER all running and finance costs?
It called the National Rental Affordability Scheme or NRAS, for short.
The National Rental Affordability Scheme (NRAS) is a government scheme which was introduced in 2008 to provide affordable housing to public sector workers, young professionals and trades people who were renting and saving a deposit for their own home. Since the scheme was first introduced, much has changed, to the point where these opportunities are transforming already investment grade real estate into high quality wealth creation gems. These rare, but very powerful, wealth building properties are offering smart investors, who understand the power and importance of cash flow, a terrific opportunity to lower their risks and improve their returns.
Importantly it is not a public housing scheme.
The scheme allows for investors in these properties to benefit from significantly tax advantaged cash flow from high quality newly developed real estate investments. They offer the ability to generate substantially more income from what would already be a high quality real estate investment in a much more tax advantaged manner.
The key aspects of the scheme are:
- Investors who invest in such properties are required to rent their investment properties to qualifying tenants at a discount of 20% to assessed market rents in the area.
- In return, you as the owner will receive a $10,350 rebatable tax off-set for each year you have the NRAS licence (up to a maximum of 10 years), which will increase in line with the rental component of the CPI. If you cannot use up your tax liability in any one year you will be paid in cash, tax free, any surplus from the ATO.
- On top of that, you also increase the amount of negative gearing that can occur, lowering your tax burden further because you are required to forgo 20% of potential taxable income each year, replacing it with tax free income.
- Because these properties are either yet to be developed properties or only recently developed properties, you also benefit from significant non-cash tax deductions afforded through depreciation.
- For yet to be developed properties you also have the opportunity to save significantly on stamp duty, and what’s more..
- Tenancy demand for these properties appears extremely strong with a similar property in Prahran receiving over 100 applications for just 6 units.
Most importantly, however, the properties and the quality of the properties discussed below are in blue-chip suburbs, in blue-chip and high quality developments, super close to public transport, major roads and highways, schools, cafés etc. Remember, this is anything but a social housing scheme. These are high quality apartments, aimed at public sector workers like police, fire and ambulance workers, young professionals just starting their careers and the like, so that they can save for their own home deposits.
If you are looking to build wealth through real estate, you have options, lots of options, and at UGC we strive to find our clients the safest ways to build wealth and achieve outsized returns.
Contact United Global Capital today and speak with one of our financial strategists for a No Cost, No Obligation consultation on 03 8657 7640 or email firstname.lastname@example.org to learn how you can position yourself to profit safely.
Here’s to your long term health and wealth.The information contained in this report is General in nature and has been prepared without taking into account your objectives, financial situation and needs.
Brett is a Licensed Real Estate Agent and manages United Global Capital's property projects and client acquisitions.