Hi All,
We have just brought our first Investment property a brand new 3 br in West Albury for $282,000 rental return ~$310/wk, but we are finding it hard to get good advice, we've met accountants who will do our tax but are not keen on giving financial advice/planning, we have also met Financial Planners who'll give financial advice on shares, super & insurance etc but don't want to have anything to do with properties…………….
So our strategey is:
5 yrs Interest only then 25yrs principle & interest
We are not sure where to use our Tax offsets, our existing mortgage is $146,000 bal & valued @ $280,000 we currently pay about an extra $,9000 p.a. but this will drop to about $3,000So if someone could point us in the right direction or to a good accountant would be fantastic.
Cheers
Hi Maccacha
I know a Financial Planner who'll be happy to talk property with you:
Richard Taylor, Residential & Commercial Finance Broker, Ph: 07 3720 1888Cheers, Paul
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
I can only recommend the accountants I have used and found helpful. They are not specialists when it comes to property, but they know legal structures and if you have an idea of what you want then they can talk you through things and teach you how to do things. At least that is what they do with me and I am very grateful.
They are called PKF accountants. http://pkf.com.au
Ryan McLean | On Property
http://onproperty.com.au
Email MeYou are heading down the right path, pay off the homeloan first and only pay the interest in the investment property.
It is the tax deductable one,
When the interest only period is up, put it back as interest only.
Did you find an accountant?
mr463
Maccacha wrote:we've met accountants who will do our tax but are not keen on giving financial advice/planning, we have also met Financial Planners who'll give financial advice on shares, super & insurance etc but don't want to have anything to do with properties…………….Hi Maccha,
You'll often run into this problem as legislation in 'recent' years has restricted what some people can/can't say.
Direct property is not considered a financial product and thus falls outside the realms of a financial planner. On the other hand your accountant may only be qualified as an accountant is not allowed to give property advice.
Property is an asset class that currently falls through the cracks – this will explain, in part, why you are having problems finding a property advisor.
Hi Maccacha and All
This query highlights the way most people investing behave,
They take decisions and buy an investment and then try to work out the best way they might have done it !!I have seen this scenario replayed hundreds of times in the last 32 years and am constantly asked for example how to legally minimise a CGT cost when they are ready to sell. You need to make this decision BEFORE you buy.
The most important aspects to any investment is this:
1. Know what you are buying – do your research well,
2. Know HOW you make the investment – what investment structure is best for your circumstances, personal position and required outcomes ?
3. Research your gross and net after tax returns and cash flows, build safeguards into your financial position.
4. Debt can be a powerful ally if properly used, it can also be a very powerful destroyer of capital if used unwisely,Shakespeare said:
"Or doubt are traitors which make us lose the good we oft might win,
by fearing to attempt"
I believe that doubt can be useful if it makes you consider or re-consider how you should proceed with an investment or not, its a positive thing which can produce a better outcome.
So doubt and debt can be good for you if you add a third thing.
That thing is METHOD, develop a methodical approach to your investment habits.
Make a check list of all the good, bad aspects of the investment and anything that may affect it.
Check the list with other investors in case you missed something.
Look at the upside and the downside.
Do enough research to be sure exactly how you think the investment might play out.
Be prepared to recognise when you need to jump ship and get out to reduce a loss.
There's a lot more but I think the methodical process is a good way to make a surer start.
There is an old engineering adage that describes this way of thinking, its this:"a problem well stated (well described) – is a problem half solved"
Happy Investing !
I would say pay Interest only on yor investment property forever. After the 5 yrs interest only period has expired, get another 5 yrs (or 10 yrs is better) interest only period established. If you bank wont extend the interest only period, switch to a lender who will.
Cheers,
Luke
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