Do we sell and buy OR sell and rent.
Lost a business a while ago which left us with a huge mortgage.
Decided now is the time to move as we don’t want to do any more reno’s to our existing home however want to ensure our money is working for us.
Thought of selling and renting something nice and at the same time investing in a couple of properties to maximise tax benefits and then put my salary into my super and live off hubbies salary.
We are both very early 50’s and are mindful of the ever approaching retirement in around 10 years and want to make sue we are comfortable. Have struggled for long enough to get us back on track.
Our salaries have doubled in the last couple of years and we earn now around $140,000 combined.
We are very new to all of this and after loosing around $150,000 in a trucking business don’t want to make a huge mistake with this.
Please help us!!!
Hi Kidja
If yuo are goint to rent yourself it is not necessary to sell the property that you have as you can always draw the equity from this property to purchase the next. By selling and rebuying the cost of the stamp duties and agent fees can be a loss that you may not regain.
However without more detail it is hard to know where you stand overall feel free to contact me if you would like a hand with the structure
Wayne
Mortgage Adviser
Email [email protected]
http://www.alphamortgagesolutions.com.au
First home buyers, investors, refinace, loan consolidation, equity loans, free service we come to you!Okay, so what you are saying is that we should use our existing home as our first investment property and then use the equity in that to purchase our second investment property?
“Okay, so what you are saying is that we should use our existing home as our first investment property and then use the equity in that to purchase our second investment property?”
That’s correct. Move out and rent a place yourselves, then use your PPoR as your first I.P.
Many people won’t do it as they are emotionally attached to their PPoR, but if you can get past this aspect of the situation it could work out very well financially for you.
You will probably need to restructure your exisiting mortgage so you can access the equity in your PPoR, and going Interest Only with an Offset account (speak to one of the great M.B’s on this forum about this) will assist with the cashflow and debt reduction. The right loan structure will save you many dollars of interest.
You can also claim depreciation (on paper deductions) on your PPoR when it becomes an I.P, so look at whether it is worthwhile getting a Depreciation Schedule prepared on you current PPoR and any other I.P’s you acquire in the future. Any building built after 1987 qualifies for a “special building write-off” and the fixtures and fittings as well. It can save you thousands on your tax return and improve your cashflow enormously. Speak to a good property savvy accountant about this.
Cheers,
Marc.
[email protected]“we get sent lemons; it’s up to us to make lemonade”
Thanks heaps, actually we went and sat with our accountant last night who also gave us a few options one of which is very similair to what you have stated.
Any other ideas from you savvy guys out there?
We just want to make sure that we are on the right track!!
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