Thankfully i stumbled upon this website. I am new to investing but do have a little idea thanks to cashflow 101 and other Rich dad publications. I would however greatly appreciat some input on my current position.
I have just purchased and moved into a larger home. WHAT SHOULD I DO WITH THE OLD ONE?
I would like to hang onto it as it would be a pos cashflow return when rented. i have three ideas. Rent the property as is. Put property in a trust with me the trustee and rent it out. Start a company with me as director, the company opens a trust and the property gets sold to the company.
Help in any way. Is there a better way????
Thanks
RICH PRich,
Welcome! And you’ll find the forumites here really friendly (for the most part [biggrin]) and happy to help.
My 2c would say definately hang on to it if its CF +ve, since its not costing you anything. This assumes its a good investment and will show some CG. If the profit after tax plus CG is likely to be less thann your mortgage interest rate then there’s a case for selling it and paying down the mortgage. But before you do that read my post on life’s little lessons…
I’ll let others talk structure for you, but there’s a few threads on that topic already if you do a search. Trusts seem to be the go and get the book from Gatherumgoss (sp?) “Trust Magic” for the low-down. The threads that mention it have links to his site.
Welcome again,
Michael.Thanks michael, the property has had great CG since i built it. i Feel that although the market has stumbled a little the are will kick on again with a new golf course and marina being built within 1klm. I hope to act on it soon as house is sitting empty. Is there any professional people in the illawarra or Sydney South that anyone would recommend??
thanks Rich PIt may not be tax effective to keep it. Do you have a loan on your new home? If so, then it may be better to sell, to your trust, and put the proceeds off the new loan. you will be up for stamp duty on the sale to your trust.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Click below to email meTerryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
If you were to use Interest Free Home Loans then it doesn’t matter where the equity is.
You can have all the equity in the IP and debt in the PPOR and it still will not affect you tax wise.
Cheers,
Simon Macks
Mortgage Broker
http://www.mortgagehunter.com.au
0425 228 985Fully Accredited With Derivex PTY LTD and IFHL PTY LTD
***Ask about our Interest Free Home Loan***
Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
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