25 October 2012
Negative Gearing Calculator meaning and Understanding Online calculators
Negative gearing calculator is a guide to potential investors who wish to invest in property abroad or at any place and gives the amount of estimated income from the investment. Online calculators are seen with every financial website and as a borrower or home buyer is free to use the online calculator with a few clicks they can get the estimated amount available for home loan, repayment schedules and also the adjustable loan repayment tenures. Negative gearing calculator is very important to understand whether the investment in property abroad is a sane decision or not, that is it must appreciate and increase our profit and not the other way, where we have to keep paying from our pockets for maintaining this property.
A negative gearing calculator is only a guide but a very good one as you can consider all the expense, known and unknown, for buying any property for investment abroad. The amount going out every month on your home loan repayments (EMI) as interest , the amount for maintenance for the home or property you have bought and also the amount going as compulsory taxes on the investment property abroad. With the help of negative gearing calculator you can find out the total amount you have spent on buying the property and how much income you are earning from this property, as profit. Many people just jump off with some finances available for investment and buy property but this calculator helps to see the long term effect on this investment.
Not only the total amount you have paid for purchase and the rent you are getting, but also consider the total extra amounts you have to pay over the years, like the maintenance costs of your property, be it repairing of breakdown of equipment or extra costs for renovation of the place , all will add up to your money costs going out, also termed as operating costs.
Financial advisors advice that it is also important to see the rate of appreciation, assumption though, for the area you are investing in, with the total amount you are spending now on the property and at what rate the value of your property abroad is going to appreciate over the years.