Forum Replies Created
renting is a bargain – not many other things in life are funded by the taxman!
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
be a little bit careful about renovating straight away… if you leave things as is and get a depreciation schedule you will be able to get a deduction for the fittings that are there over the course of the next couple of years. if you renovate straight away the ATO rules that your purchase price would have allowed for the shabby fittings i.e. it is assumed you got the place cheap, so no tax deduction. What is your motivation in doing this NOW? if your tenant is happy why disrupt them… I doubt if the reno will bolster rents enough to justify the reno so all you are doing is boosting your equity. If you need this to buy your next place, well then fair enough you have no choice. Just talk to the tenant and see what they would want to move, you never know they may hate it and be quite happy to be released from theor contract!
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
actually this is what your typical sophisticated investor looks like – dont mess with him[cool2]
For anyone that hasn’t read Kiyosakis books I will save you a $100 and a couple of hours reading:
* your house is not an asset as it doesnt generate income
* you can be one of 4 things – wage earner,self employed, investor, business owner. Wages suck, be a business owner* get out of your day job asap and make a buck – anything that makes a profit after all costs is good. Debt is good so long as it is for income generating activities, not luxuries.
thats pretty much it, pad that out and put it in big font and hey presto – millionaire trainer.
I enjoyed his books tho, a nice and light motivational read.
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
Hi Tracey – I received your email re this and was all fired up. Then I realised it’s a Friday night… some of you really love this property stuff!!
I too will be interested to hear the answer on this one regarding regulated home loans.What they can do and what they would do is also two different things – similar to what the Japanese banks found – they couldn’t call in their loans as they would lose too much – better to let them tick along.
I have heard commercial loans are a piece of cake to call in – I recall my broker telling me that the NAB once decided they didn’t want to operate in a partuclar medium sized WA town and they just called in their whole loan portfolio. Some businesses managed to refinace, some went to the wall.
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
this article is 4 years old – is it safe to assume that in those 4 years since the last test they have been unable to replicate the results? I would think that if they had it would be sensational news – but then look at the BSE debacle, and asbestos.
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
The biggest problem I see with this strategy is the tax – it no longer falls within CGT as you have now become a property trader and taxed at full marginal rates. Add on transaction costs and risk and a cooling market and and and….
well the fee may be fat but it may not be – maybe they just charge reasonable transparent hourly rates. I cannot believe the financial services industry is allowed to continue the way it does, with financial planners selling basically whatever the highest commission is on the day and many mortgage brokers putting people into loans with the highest trailers and constantly refinancing (churning) to generate more income. This is particularly so given the ageing population that require these services more than ever.
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
it’s a bit like whether you buy a property overlooking the ocean or one in a country town – you have to weigh up the growth vs the return
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
my girlfriend’s mother has just been diagnosed with asbestosis and given 9 months to live – she had no more exposure than teh average person i.e. hasn’t worked in Wittenoom etc. as always happens – when you are affected by something you start to notice articles and info about it. last Saturdays West had a 1 page article covering these issues and went on to say that the true toll from asbestos is yet to hit us. I suspect that this is a simmering issue.
Personally I wouldn’t stay in a home that had asbestos in it and I would factor in the cost of removing it at some point in time.
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
sounded too good to be true from the outset. the ATO had their noses out of joint from the word go which is why I held back… seemed a bit risky given the ATO had flagged their discontent with it. I have to admit I can’t see any major repercussions form this – just business as usual really.
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
sounds like it is directed towards a full on excavation operation. If it were me I wouldn’t be too concerned.
I think you are being too harsh on yourself – I wouldn’t be rushing into selling the property and taking a loss. On the face of it, it sounds like a quality place that’s returning close to 5% gross – not bad. I would just pay as much in as I could afford, adjust your weekly tax deductions to help you if necessary, then when you have enough equity in a couple of years time or as soon as you can borrow the money, develop the back unit. Consider keeping both if they are running ok. get a QS depreciation schedule done on the property too so you kow exactly what to claim.
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
Marty – I think you need to do a bit more than one electric bill. If they audit you they will want to see a full intention… which could be supported if you had: a phone connection, power, gas, all your mail directed there. Then you could support your reasons why you decided to leave your home e.g. a new relationship, job transfer, didnt like the neighbourhood.
Hi Fern – I guess there were two points to my comment:
1) the saying doesn’t make sense because it disregards things such as: (a) an economy can grow (b) the population can grow (c) value can be created without costing something e.g. a new technology and so on. If the saying were true, then a property’s true value should be the same as it was 1000 years ago (adjusted by inflation) – a nonsense I am sure you would agree. The saying dismisses any concept of growth.
2) The 12 months thing – what time frame are you putting on this then?
any sort of tax that stifles productivity and getting ahead seems to be in favour. but aussies love the socialist ideal and the concept of tax the wealthy to help the poor – the recent outrage about tax cuts for anyone earnign more than $52k is testimony to that. As an article in todays West concludes: “We need to value our wealthy and our skilled. Without them, we’re just another failed socialist paradise.” And it really does sadden me everytime I hear yet another one of my colleagues tell me they are heading overseas for bigger $ and less tax.
Originally posted by Fern:My opinion: For every loss there is a win
Very true, and with all the winning thats been going on over the last three years, there is going to be one hell of a correction.[biggrin]
This may be a catchy saying but it makes little sense….
I want to buy a holiday home by the sea in the next 12 months – but I am not holding my breath for any sort of price decline. I wonder if people are talking up this crash because its a bit like anticipating the Myers Christmas Sale – the dream of getting something discounted?
“your deal’s in trouble if the difference between making and losing money is claiming a tax deduction for depreciation”.
Yes but this is confusing cashflow with profit – two different concepts. A CF- person is relying on capital growth to collect the profit. There are many suburbs that have generated an average 10%+ cap growth over a 30 year period, so if you forget about trying to time the market (which invariably you can’t) the returns are solid. If you belive cash is king and are a CF+ person, the cap growth is just a bonus – luckily as it may well be negative. But if CF+ investing remains flavour of the month, then it will continue to generate growth for these properties and revalue them on a new basis. Problem will be if it ever falls out of favour – will be like a pyrmid scheme unravelling. should be ok though… if you pick your towns and locations right. The thing that always bothers me is – if the rents are so high compared to owning, why aren’t the locals buying themselves. Either it’s very transient or they don’t have the confidence to purchase themselves.
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
Originally posted by georgisj:Ausprop,
Some information/data on east coast property prices from APM
http://afr.com/articles/2004/05/26/1085461821861.html
James
Wow! amazing data. is the feel on the ground the same or is it just usual crazy stats not reflecting reality? The data suggests there could be some good buying over there. Speaking of dodgy stats, the Perth numbers were released last week… 55% price rise in Trigg in 3 months?! Somehow I don’t think that is underlying land value driving that! and yet Scarborough shows a slight decline… these figures are so influenced by many factors that cannot be reduced to one headline % number.
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
