Pay for the mowing, get rid of the grass or get rid of the tenant.

Mowing once a month is not something that will send you or the tenant broke, perhaps you can split the cost.
Can you change the front yard into a low manteneace garden? Pebbles, concrete, rocks, woodchips, Roundup, Mondo grass?
Get rid of the tenant . . .nee only kidding, if he pays and in time, get rid of the grass.

May God bless you
and prosper you.
Marc

Hi Brenny.
Your father is not alone. I see people in that predicament every day, either with one rental property or a holiday place down the coast.

The pension in Australia is not the result of a contribution like it is in Europe and so it must be asset and income tested. The test used is the one that allows to pay the least amount of pension, In your case it seems that the asset test will be applied.

For every $1000 dollars that the asset goes over the limit (and from memory it is 212k for couple and 160 for single but please check yourself) the pension reduces $3, so if the duplex is about $300k no more pension.

Asset reduction strategies (how I hate such terms) are only a few. Many people I see are so determined to “get the pension” that burn their assets in overseas holiday trips. Some pretend to spend the money claiming long trips and heavy losses at the casino, but this is risky since it can be disallowed if it is not credible. Gifting is limited to $30k in 5 years, maximum 10k per year and 2 years nothing at all. Selling the property to purchase a complying allocated pension may see some of the complying portion of the pension exempted from the asset test. Yet this “complying” products are rather crappy because they are paid for the life of the person but the bank keeps it after the person passes away.
Some better and more sensible ways for your dad are, to sell both properties, his own and the duplex and purchase a nice big mansion at the harbour. No worries, full pension and you have a nice asset in the family that will not go to the sharks.
Another way is (if you don’t have your own home) for him to purchase a house for both of you but only on your name, and he will be purchasing a life long right to use the house and stay with you. The house can be divided in two, have a granny flat for him or whatever arrangement you like. This is called the granny flat rule. It is a bit more complicated in so far that he cannot buy the right to live in a granny flat in Cabramatta for 2 million dollars, so there are formulas to see if it is reasonable to pay what he is paying.

Personally, I suggest to people to sell 2 properties and buy a nice new one in the place of their dream (if they have reasonable dreams) This way there is no need to cheat nor to pretend losses and take fanny risks.

He also does not need to spend all the money, aprosimately $70,000 dollars in the bank and applying the deeming interest rate will be under the income test and clearly under the assett test as well. 100 or even 160,ooo will cut some pension off but will compensate with income from the bank. See the deeming rules on the Centrelink web page, it goes aproximatley like this: the first 30,000 dollars are deemed to earn 2% and the rest 4% (check figures for accuracy).

As for who to approach in Centrelink, ask for an appointment with the Financial Information Service Officer, FISO, they are usually knowledgeable and helpful.
Hope this helps.

May God bless you
and prosper you.
Marc

I did a bit of reserach on the Southcoast NSW and found that most agents agreed that a beach house may rent for 6 to 10 weeks a year. Of course you can be creative and if you have something out of the ordinary you may inproove on that figure. But honestly even if you double it, returns are on the very lean side, am I wrong?

Of course the prospect of an almost free holiday house is appealing and you must account for that value as well. Good luck. Have you tried to advertise on the net to other countries?

May God bless you
and prosper you.
Marc

Hi Monopoly!
(I do like your posts)

The key to your question is in this paragraph:

Do you beleive that rich people are (expletive) evil?

If you do, you are bound to have friends and acquintant that beleive the same, rich is evil and poor is virtuous … therefore don’t be surprised if they act accordingly. After all they read it hear it and see it every day. It is hammered in their head 24 hours a day, and even preached Sunday in the church.

If on the other hand you do not believe what 95% of people on the planet do, (that rich people become rich at the expense of the poor) then you have emerged from the crowd and will be rather isolated unless you switch crowd to find friends among the people who held (like I hope you do), success in high esteem, that think success and failure to be both the result of choice and not luck / bad luck.
You will be surprised to learn how wide spread such limiting beleif realy is, and how damaging it can be for your personal development.

If you need some inspiration in that field, send me a personal message with your e-mail and I will send you an e-book on the topic of “accept your abundance” (free no strings attached.)

May God bless you
and prosper you.
Marc

Hi Torachan

Not sure if you are still watching this, but I’ll give it a shot.
To your hypothetical question, “if all owners would buy each a IP” . . .there would be not enough properties nor builders to build them, in fact there would be fist fights in front of the RE agents.

What prompted me to respond is the way you formulate your question. “Does this work for everybody” or words to that effect.

I get this a lot in our personal development seminars. Usually people who put this question “IF everybody would do so then this does not work” have an inquisitive mind but are trained to spot injustice, not business opportunities. Usually of a “left wing ” inclination, they like to fight injustice and have acquired during such exercise an long string of limiting beliefs that stop them from achieving.
Yet if I point this out to them, they are usually offended or at least very surprised.

As entrepreneur, you must ask yourself, is it legal and will this work for me?
The question “IF everyone does it” has value but for a different purpose.
You must ask yourself “Does everyone do this?” if the answer is yes, you know you must look somewhere else for an opportunity!

Entrepreneurs are artist, leaders, inventors, not crowd followers. One last thing, real entrepreneurs do not retire ever.

May God bless you
and prosper you.
Marc

Mm, not sure what’s all the fuss about this question guys, then man is curious, just tell him.
I don’t own any IP outright, some of my earlier purchase have a small loan of less than 20% of their current value. Besides my own home I have 8 IP, one is negative cash flow the rest all +CF.

May God bless you
and prosper you.
Marc

First IP bought in Sydney in 1998. 40 years old b/v 4 bedroom house for 154k rented at 200xw. Today its 450k and rents at 240xw, still with the same tenants that never skipped a beat.

May God bless you
and prosper you.
Marc

Why would anyone want to “retire”?
Remeber the wave of early retirees who headed for the Queensland beaches in the eighties and early nineties, with the bounty of the family home?
Scary prospect, most are now on the age pension and broke.

You retire from what you don’t want to do.
If you are doing now what you don’t want to do, you need a career change not retirement!

Once you start doing what you like, you don’t want to retire… you don’t even feel your age.

I don’t think I will ever retire. It will be eventualy my body or my mind who will retire not me.

May God bless you
and prosper you.
Marc