Hi,
I have 2 properties that are currently being rented out ( I live with my inlaws ATM!). We had the intention of moving into one of the properties once the lease was up, but now we are considering renting a 3rd party house that is in a different suburb to be closer to the city.
So I was wondering from a financial aspect, if it was a better option to continue to rent out the 2 properties (both negatively geared) and live in a 3rd party rental house? I was once told by a friend that if he had his time again he would would have done this with his own properties. Now I'm in the position to do it, I'm not sure if it would be the best thing financially to do.We also have our furniture currently in storage that costs us $220 a month.
If someone can assist that would be much appreciated.
Have you considered sell both the negatively geared properties on an vendor financed installment contract (wrap)? Both properties then become positively geared and the additional cashflow will help you rent a third party house…
Just an idea.
Lynn
[email protected]Hi there, obviously it really depends on your financial situation and your wealth and lifestyle objectives and goals. However, there are some real benefits to retaining your rentals as rentals, if you can afford to do so. There are a number of ways you can work to improve the cash flow position of the properties, Margaret Lomas has some great ideas on this and has books and tools and resources you can use. Although she focuses on positive geared property, some of the tips she has for creating positive gearing, can be used to improve a negatively geared position as well.
Another great tip is to ensure you are maximising your tax deductions on the rental properties. One way of doing this is to make sure you have a Tax Depreciation Schedule, prepared by a professional quantity surveyor, for both properties. <modedrator: delete advertising>
Best of luck with your decision.
cheers
Leah WilkinsLeah Wilkins | Capital Claims Tax Depreciation
http://www.capitalclaims.com.au/
Email Me | Phone MeBenefits you appreciate.
Hi
Im doing exactly that now.. I cant afford to buy and pay down where i want to live at the moment so i pay rent..
this allowed me to keep all of my properties and focus on saving further for my dream PPOR (which i intend to buy and still rent where i am until I can afford to live in it comfortably, 2-3 years)
If its not your dream home why waste the benefits of – gearing just to live there? But I wouldnt sell unless you have to..
With the extra you save from renting, offset on one of the properties to help get it to neutral ASAP, can always use it to buy PPOR ot IP when your ready..
It took a while to get used to it not being mine but thats just the social pressure/stigma that we are raised with..
It also gives me a nice place to return home to instead of living in a 1/2 reno'd place (I have one on the go now/always..)
Ive done it tuff, now I dont need to..
Nothing wrong with renting!
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