The NRAS Cash Flow Advantage
Comparing four investment properties where two are valued at $360,000 & the other two at $400,000 each (both identical except that one is NRAS accredited).
Using two different investor tax rates, we compare the difference NRAS will makes and you will notice that in most circumstances a NRAS Investment Property is Positively Geared attributable to the $10,350 Tax Credits you will receive per year, over a 10 year period (could amount to just over $110,000)
comparing NRAS vs non NRAS investment property
What the above table means to you is that if you invested in a non-NRAS property you would be negatively gearing by -$436 over 10 years
If you invested in a NRAS investment property you would be Positively Geared by $89,952 over 10 years
The total difference amounts to over $90,000 better off in a NRAS investment property over the 10 year period
Around one third of all dwellings in Australia are rental properties. Close to 3 million dwellings
The Government has estimated that around 1.5 million Australian households are eligible for NRAS housing.
Under the NRAS program a maximum 50,000 total dwellings will be approved by 2016, meaning a massive under supply of NRAS rentals available
We are currently at the tail end of the first 40,000 licences meaning if you do not commit to increasing your wealth using the Tax Man and your Tenant … the next time you may be able to secure a Positive Cash Flow property with NRAS will be at the end of 2015
Do you realise that you will miss out on 2 years of Tax Savings that could easily have paid for your whole deposit by simply choosing wait??
Comparing NRAS to non NRAS, there is no difference in the physical property – the only difference lies in the NRAS ‘license’ that sits on your NRAS Investment Property … so why would you consciously chose a non NRAS investment over a NRAS one
Comments or questions are welcome.