Check with council what you need in order for it to be strata titled (eg fire wall, size of land etc).

Not all will be able to be strata’d.

What type of deal are you looking at? It’s not clear.
You find a deal (is that it?) and the other person pays the deposit? Then what?

What is your end goal? Renovate and sell?

Getting Money Partners can work but you need to have a clear idea of what you want to do And how each player benefits.

$299 is not a lot of money, so you are sure to get something out of it. Most reports from beginners have been positive. But as with anything there are some negative comments.

Please let us know what you think. Speak to as many like minded people as you can. That’s a great way to learn.

Puting in new kitchen cupboards, taps are improvements whenever you do them. Not maintenance.

If you want to draw equity now, why wait. The cost of lost earnings with what you can do with the money would out way tax deductions I think. We always reno straight away, thereby gaining instant equity plus making properties CF neutral at positive from day 1.

I don’t know how the option ties in.

If you redraw the $32K from your IP you are contaminating the loan. ie it will be mixed with both deductible and non deductible (the $32K) money.

Do not do that.

I’m a bit confused about the $8,500 loan. I would increase that if possible (as I assume it’s tied to the IP) but it will be separate and not confuse the deductible and non deductible debt.

Change the IP to interest and if the IP is CF+ direct the rent to your non deductible loans. Or you could even compound the interest on the IP loan to pay down the PPOR debt faster.

Great points Benny. My strategy when I started buying was to only buy it if I could sell it the next week and lose no money.

It was tricky but it was a buyers market so possible. I had to buy under market in order to cover buy and sell costs but it was a good guide for me. A few properties I did a reno straight away and could have sold for a profit after the reno (5 weeks).

I like the philosophy that every purchase should get you closer to your goal.

If you buy well and have to sell earlier than expected it shouldn’t be an issue.

You are correct that in a slow market a property may become stale and the price is reduced. This may or may not mean it’s a lemon property. You need to know the difference.
For example an acquaintance of mine listed her property for $519K against my RE agents advice to list it for $499K. It got a lower offer but it fell through due to an easement (no problem really). Anyway it went stale as it was over priced. Then she was in a panic (new house settling) so she dropped the price to offers over $450K and sold it that day for $447K. I was screaming as I would have bought it myself. It was a steal.
It needed a reno but basic. 3 years later it’s now worth $800K.

So you need to know if it is a good buy or not. Maybe a property was grossly over priced in the first place so not a bargain. If you know the suburb and the prices then you are able to tell the difference and jump on properties when they are right.

Are you talking basic exit strategy or how to get rid of lemon properties? You need to way up the cost of keeping a property that is not performing.
But exit strategy as a whole depends on your goals. Some buy a huge portfolio and sell down to reduce debt. Depends on personal strategy.

• This reply was modified 9 years, 12 months ago by  Catalyst.

As you do not have a cash flow issue I would be looking for the best chance of capital growth rather the concentrate on cash flow properties. They are great and I love them but you need capital growth.It is possible to get both though. I don’t think a 1 bed in Brisbane is a good choice.

Do not pay down the first property. At the moment you have no non deductible debt but later you will want to buy a PPOR (principal Place of Residence) and if you pay down the investment loans you will need to borrow money to buy a home and not be able to deduct any of ot.

Get a loan with an offset account (NOT a redraw) and put extra money into that. Then you can withdraw it later and buy a home and still get the tax advantage.
You need to speak to a good broker to ensure your loans are set up correctly and plan for the future.

Please explain!!!

It is not clear what you are asking.

nomination twice?

loan not approve?

need to sell it our as a nominee? You were listed as a nominee but not going ahead?

You can ‘t pick one house in a sub urb and work out what the suburb is doing.

Sometimes people sell properties to relatives or their company cheap for tax reasons.

The Penrith one may have had a major renovation. Although a capital gain in Penrith of 400k in the last 2 years would not be uncommon.

I’d say that was pretty typical of Albury/Wodonga. They have had very little capital gain in the last 4 years, probably more.