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Unless it is expressly contained in the agency agreement that the agent can settle personal injury claims, I do not think the agent would have either implied or ostensible authority to settle a potential claim for personal injuries
who was responsible for mowing the lawn you or your tenant?
so you came to an undocumented settlement not with the allegedly injured person but someone entirely different?
on rereading your post I see that there is no mention of lawn, but of grass – was your agent smoking this at the time?
How are you able to claim depreciation if you have entered a contract to sell the property?
What you need to do is look at your structure.
a. you are in Victoria so your IP could be transferred by one of you to the other free of stamp duty and if you treat it as your PPOR free of CGT. What was the value when you started renting it out? This could give you approx $70K of new deductible interest so you could pay that off your PPOR. This could drop your loan to $430 and your repayments by a bit under $100 p.w on the PPOR. A risk with this will be vulnerability and pressure if your tenant stops paying rent or you have a vacancy. If the property makes a tax loss, the loss will be added back to income for the purpose of calculating family tax benefit. Have you got a depreciation schedule on this property. Will there be break costs on the fixed loan portion?
b. sell the IP, treat as your PPOR for CGT purposes – reduces your PPOR loan to say $370K after selling expenses this will drop your payments about $150 per week bringing you back to around $600 per week P & I
If I were in your circumstances I would sell the IP, reduce the principal, keep your $70K intact, put the additional $150 per week into the offset until you stop working and if necessary after you stop working put $150-$200 pw from your savings towards your mortgage. You could do this for a number of years and still have a good safety net. I would also review life insurance and income protection insurance. At some stage in the future your strong equity position in your home will give you the opportunity to get other investments.
What I meant in my first post was it's all very well to have tax deductions but their usefulness is only if you have income and if you have no income the tax deduction will not be useful.
I don't think they will have much trouble working their PAYG down when one of them stops working to have a baby.
If you retain your existing PPOR as your pPOR and purchase interstate then while the second property is not used to earn income any expenses of owning eg interest maintenance rates insurance will form part of its cost base for CGT purposes
Gifts are not taxable.
The Vendor's obligation is to sell with vacant possession. Until vacant possession can be given there is no penalty to you for refusing to settle before the tenants are out.
As people have pointed out there are pros and cons. I self-manage one property and have agents manage my other properties.
Advantages of agents are:
a. hopefully shorter vacancy periods
b. they get the phone call saying the HWS needs fixing and I don't have to take time out of a busy job to organise. They ahve the connections with trades and handypersons to get jobs done when needed.
c. hopefully they have better knowledge of rents and can keep the rent at market rentals
The property I self-manage is let on annual tenancy to tenants I know who pay through their employer and are proactive and willing to organise a repair if necessary after approval.
Wilmacacc wrote:Also, If your employer agrees, you could salary sacrifice the expenses relating to the property, essentially giving you the deduction for the expenses while leaving the income in your wives name. The payment of the expenses would be an exempt fringe benefit using the otherwise deductible rule.This was changed two Federal budgets ago.
If you need a seller's advocate what are you paying an agent for? Commissioning your own valuation might be better because then you would have a better opinion whether the agents are in the right ball park
Try your body corporate or strata managing agent
Any body who thinks they can give you specific advice on a contract without looking at it is deluding both themselves and you. If you have any concerns you need to go and seek competent professional advice from a practitioner in your state/territory as a matter of urgency so you can be advised of your rights and obligations
What you find with a number of those border towns is that they are holiday places for Victorians. Certainly before Vic got pokies the punters would converge on the licensed NSW ckubs in droves.
If the houses have been rented out before the agent should be able to obtain a rental history for you.
A "good investment property' is a property that you would buy for investment purposes. Is your existing property is a desirable investment? ie readily lettable at a good rent with potential for capital growth.
Is major capital expenditure requiring special levies likely in the next 10 years?Get a depreciation schedule done.
It's probably close to the mark. My recent situation is:
Mortgage 1 – 4 yrs 8 mths
Mortgage 2 – 1 year 8 months
Mortgage 3 – 4 years 7 months
Mortgage 4 – 3 years
Mortgage 5 – 7 monthsWhen you bear in mind the average home is owned for 7 years by residential owners and then that the average investor is going to be a bit more aggressive using equity etc
Possibly the suggestion is that lenders weren't interested in knowing about guarantees. This is much less likely to be the situation now
Simply because they are not discretionary. If I have invested 50% I want 50% of the profits, not 1% or 99% (maybe I do want 99%).
People use discretionary trusts so they can spread income amongst their family tax advantageously.
Basically similar set up costs
Ryan,
People who are non related and invest together are not going to want to be involved together as beneficiaries of a discretionary trust, because a discretioanry trust gives the trustee discretion in which beneficiaries receive income or capital.
A more common structure where non relatives are investing would be a unit trust and the investors would invest in the unit trust either directly or via their own discretioanry trust.
