I’m excited to hear about all these investors/potential investors leaving the NSW property market. Why? Because reduced supply of rental property will lead to higher rents

From my point of view yes I will be up for land tax. However, when I pay $100 land tax, it is tax deductible, so on a 48.5% tax rate, I’m out of pocket but not much. When I…[Read more]

There seems to be a fundamental difference between advising someone on the merits of an investment and telling them that the valuation obtained by the bank is for tens of thousands of dollars less than the contract price.

There are a couple of issues from some of the program participants:

1. if I borrow money and as part of the terms the bank…[Read more]

You need to look at what your reasons for considering selling are. Possibly you think the Qld properties are still going to be slow to appreciate or the -ve cash flow is something you want to avoid or your seaside units are too much work for the return.

From a tax point of view from what you have written it looks like if you sold your Qld…[Read more]

Most capital growth comes from land component which you will not own.

Other issues to consider would be how difficult it might be to use the equity in the unit to purchase something else, how easy will it be to resell if you need to, what security do you have for the lease with the park.

You need to consider what you are trying to achieve with…[Read more]

A link to a website giving information on the Consumer Credit Code is:

http://www.creditcode.gov.au

While FW is right that different consequences might happen depending on whether one is “in business” or not in many areas of taxation, it would seem to me that the taxation consequences for many wrappers would not differ significantly as even if someone was not in business, if they wrapped within 12 months of the date of their purchase contract…[Read more]

Try the local council website. Information provided varies, but worth a go

crj

In a thread called Collinsville Rugbyfan did a good breakdown of the kind of things to do due diligence on in a mining town. I’m sure you could adapt this and use the information as a basis for determining whether rents will continue at current levels

Redlilia

You will need to do plenty of homework.eg Who is managing the property? Is it one of the national storage companies? If market revaluation, bear in mind this might fall.

How much storage exists or is planned for Townsville? Can your storage space be divided into smaller units if that is where the market is in the future?

What is…[Read more]

Dear Faraway

In NSW the law requires the Vendor to obtain:

a. a copy of the Land Titles Office copy of the title
b. a copy of the plan of the land
c. a S 149 Certificate. This certificate is obtained from the Council and shows the zoning of the property
d. a copy of the sewearage diagram

Suggest your sister gets written quotes from…[Read more]

Cash in $20000
Inflation 13.67% = 2734
Cash out after paying loan $50000
Profit $26266

Still fairly simplistic calculations as does not take into account costs on purchase and sale and any additional cash put in during the 5 years.

However, in my view your investment’s ability to beat inflation depends on what your cash investment is

Dear Redwing

Of your 8 scenarios:

a. 4 are basic errors by the landlord or the PM in failing to cross the t’s and dot the i’s. If they are PM errors the landlord would have a claim against the PM. However, obviously the better solution is to look at what steps the landlord can take to prevent these. These could include as standard procedure…[Read more]

Swannie,

Talk to a broker and you’ll find most of the companies have a insurance policy for invest properties which will cover public liability cliams against you. I also like to cover for rent for 6 mths to a year so that if something happens to the property I’ve got income coming in.

Don’t know any brokers in Sydney

crj

Martine,

Different strategies suit different people. With new property you are obviously going to have tax benefits with depreciation and building write-off. You might still have +cash flow property as described by Margaret Lomas in articles in API because of these non-cash deductions, that is the rent plus tax refund is more than your cash…[Read more]

Rachel,

Many smaller country towns have good demand for rental as a lot of people eg police, teachers, nurses work in the town for 3 years or less and don’t want to buy for that time.

Capital growth is often spasmodic. If you need to sell, it may take a long time to get a buyer.

In some smaller towns real estate agents have stopped managing…[Read more]

Ken

When I went through Goondiwindi last year housing there struck me as quite dear, so the price in Boggabilla mightn’t be too bad if people who work in Goondi are prepared to live in Boggabilla and commute. Talk to a couple of agents about how likely you are to be able to rent after the 6 months is up.

A lot of valid points have been made.…[Read more]

Dear clavil,

do you want confirmation of your beliefs or otherwise. There have been a number of postings recently which indicate that while +cf investments are difficult to locate they can still be found. It may be that the location/type/whatever of these properties does not meet your parameters for investing and that’s fine. If that’s the…[Read more]

Best in what context.
What is best for one investor might not be best for another eg renovating might make sense for someone with some skills and time as they are converting these into an asset, but it might not make much sense for someone who lives a long distance from the property.
Do you mean best from capital gain or cash flow
What would be a…[Read more]

Bindi,

Maybe you should concentrate on one or two areas, become very familiar with them and get to know the agents. Get the local papers, ring the private sellers.
Also, look at different ways to amke a property +cf eg if it is on a large block of land can you subdivide it and sell off the surplus thus reducing the cost.

There’s an article in this week’s Business Review Weekly on the type of issues the ATO is looking at in relation to property investors. If you leave one vacant, the ATO might regard you as a developer and say all the profit is taxable as income rather than as capital gains.

crj