All Topics / Help Needed! / Changing from PPOR to IP – am I on the right track?

Viewing 7 posts - 1 through 7 (of 7 total)
  • Profile photo of sdemsdem
    Member
    @sdem
    Join Date: 2007
    Post Count: 14

    Hi all.

    Two years ago I bought my first home. Due to the family being unhappy with our tree change we moved back into a rental property in Melbourne a month ago and my house is due to be tenanted at the end of this month. I just wanted to see if I’ve covered all bases as I’ve never owned an IP before…

    I have landlord’s insurance and building insurance. Dropped the contents insurance.
    Have an agent (don’t want to be caught up in the management of the property).
    I haven’t informed anyone that my home is now an ip – do I need to formalise this? With the ATO or bank or anything?
    Planning on getting house valued and have quantity surveyor come through before tenants move in (although I think the house was built prior to 1985).

    Is there anything else I should be doing? I briefly considered changing loan to interest only, but it doesn’t actually make a huge difference to the amount in repayments so I think I’ll keep it P&I – unless anyone strongly believes otherwise…?? I plan on buying another IP next year, so the more equity I have in this house the better I think.

    Cheers!

    Profile photo of god_of_moneygod_of_money
    Participant
    @god_of_money
    Join Date: 2008
    Post Count: 970

    I/O only account with Offset

    Profile photo of Jamie MooreJamie Moore
    Participant
    @jamie-m
    Join Date: 2010
    Post Count: 5,069

    It would be worthwhile having it valued or getting a market appraisal from a local real estate agent. This is done for CGT purposes. Basically, when selling the property, you only want to pay CGT for the portion of time it was an IP. By getting a valuation now, you’ll be able to provide evidence to the ATO that the property was worth $x when it became an IP.

    Cheers

    Jamie

    Jamie Moore | Pass Go Home Loans Pty Ltd
    http://www.passgo.com.au
    Email Me | Phone Me

    Mortgage Broker assisting clients Australia wide Email: [email protected]

    Profile photo of sdemsdem
    Member
    @sdem
    Join Date: 2007
    Post Count: 14

    Thanks Jamie. I’m assuming it’s good to have a high valuation then, to reduce the amount of capital gains. Will any real estate agent do this?

    PS – I rang the council today to find out the age of the house for the depreciation schedule and they want to charge me $45… is there anywhere else I can find out when the house was built? It’s not in any of the info I received when I first bought the house.

    Cheers :)

    Profile photo of beanzbeanz
    Participant
    @beanz
    Join Date: 2011
    Post Count: 7
    Jamie M wrote:
    It would be worthwhile having it valued or getting a market appraisal from a local real estate agent. This is done for CGT purposes. Basically, when selling the property, you only want to pay CGT for the portion of time it was an IP. By getting a valuation now, you'll be able to provide evidence to the ATO that the property was worth $x when it became an IP. Cheers Jamie

    Can you just get a market appraisal from a Real Estate Agent? I thought it had to be a valuation from a  valuer?

    Profile photo of Jamie MooreJamie Moore
    Participant
    @jamie-m
    Join Date: 2010
    Post Count: 5,069

    My accountant advised that an appraisal will suffice.

    Cheers

    Jamie

    Jamie Moore | Pass Go Home Loans Pty Ltd
    http://www.passgo.com.au
    Email Me | Phone Me

    Mortgage Broker assisting clients Australia wide Email: [email protected]

    Profile photo of Jamie MooreJamie Moore
    Participant
    @jamie-m
    Join Date: 2010
    Post Count: 5,069
    sdem wrote:
    Thanks Jamie. I’m assuming it’s good to have a high valuation then, to reduce the amount of capital gains. Will any real estate agent do this?

    Spot on.

    Cheers

    Jamie

    Jamie Moore | Pass Go Home Loans Pty Ltd
    http://www.passgo.com.au
    Email Me | Phone Me

    Mortgage Broker assisting clients Australia wide Email: [email protected]

Viewing 7 posts - 1 through 7 (of 7 total)

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