I currently have 1/3 of an IP with my two siblings. It is a two level 2 brm townhouse on the corner of Scott St and South Tce Fremantle We purchased it for 195,000 in 1999. We recently dicussed selling up. We currently owe about 140,000 on the mortgage. One of us is particularly keen to get out while the other sibling and I did discuss the possibility of buying the third sibling out of their equity. I have thought about retaining an investement in this property and increasing my share to 50% or am I just better of selling up and moving on buy myself? I guess I do want to go on by myself but is this a good time. So far we have had no problems with diagreements or any other issues that can arise when family members do business together. Any advice would be much appreciated.
hi Olly,
You may have to post some more details regarding the deal.
how much is the property worth now ?
What do you get out of it (income) and a fewmore details.
IMHO you need to work all the details, plus pro’s and cons on paper and look at the deal as a business deal tehn see what thebest move is..
what was your intent when you purchased..are you on track with your plan?
Do you have a plan?
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow CalculatorThanks for the reply Redwing. In answer to your excellent Q’s
1. I am making the assumption that the Ip has achieved on average 10% capital growth, so based on that I estimate it is now worth between 320,000 and 340,000.
2. We currently receive $220/week in rent.
3. The plan when we bought it was to keep it as a long term investment, obtain good capital growth and then in the future access the equity to purchase another property. I guess in part the plan seems to have played out as intended except for the purchase of another property. As far as a detailed plan is concerned I dont have one comitted to paper.
At this point I am considering staying with this IP and buying out 50% of number 3’s equity by refinancing, and then access this equity at a future time to buy another IP. The other option is we sell up now while the market is not in decline, and go our separate ways and look for new opportunities.
Cheers!
Hi again Olly..
Firstly i’d get 3 valuations from local REA, i then average them out to get an idea of the properties worth ( i do this each 12-18 months on my IP’s).
This should give you a good indication, then start looking at what each of the partners want to do and if someone did sell thier share, waht would be a fair and equitable wayof doing it (? market value minus 10% of thier share?)take notes, keep it all down on paper and look at all the options.
Who knows you may have a bunch of equity that you can still do something with, ven after buying out a partner?
IMHO also sit down with a good Mortgage Broker and discuss your options also..
It’s all about looking at the available options and choosing what best suits “YOU”.
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow Calculator
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