There are some exceptions, like you said with livining in a rental.

But I would check with your tax man to make sure you are doing it correctly. The reason for this is because if you don’t pay GCT you are liable to pay back all tax you have deducted over the years as a ‘loss’ on an investment house that didn’t end up being classed as an…[Read more]

“But from what i read IO payments are from 5-10 years. So does that mean my new monthly repayments are going to be a lot higher?”

No. It just means that you are only allowed to pay interest only for 5 to 10 years, after that you must pay capital. At the moment interest only on $270,000 is about $20,000 if you go to the right bank.

“So say for…[Read more]

I always find these things work OK so long as neither of you is living in the house. For example it is usually a terrible idea to buy a house together and live in it. Buying a house together to rent out isn’t so bad, because the fact is you can simply sell it if you have too and probably won’t loose any considerable money.

If you have to go as…[Read more]

ozinvest realty charges 8% and there are no fees for anything. So you get inspections and everything handled to do with bonds and rent etc. They also represent you in court for anything that happens over tenants etc. They seem to have alot of full time inspectors and hundreds (possibly thousands) of properties. Other ones I have seen charge 6% but…[Read more]

say its $300,000 then expect to rent it for $280ish if you can. 8% of that goes to property management fees. Typically about $500 / year on maintainance. Rates $2,000 per year. Insurance $500/year.

When you get a loan you will probably be up for 4% mortgage insurance. Then when you sell, 2% in commision and 25% to 50% of your total profit to…[Read more]

I think this also flows over to people who talk about renting a house while buying an IP. Sure you will own the IP cheaper this way, but with capital gains tax you will actually come out behind someone who just brough and lived in the house. Many peopel seem to have this backwards (the assumption that an invester will make more out of a house than…[Read more]

Woodridge will onyl have good returns for a few years until it catches upto the rest of the places around it. After all it is only cheap because of the bad name the area has, it is a bad neighbour hood.

Remember average prices might go up but that doesn’t mean that houses aren’t sitting for ages waiting for that price. Having been eyeing some…[Read more]

Yes the best a bank will do is roll it onto a personal loan. Your banks credit card company will probably do it.

Well to start with generally you should be close to it not have paid off your own house, at the minimum. That way you don’t have to rent.

Basically its hard for a investment to return more than that saved buy paying off existing debt, since the current interest rates are 8% and hosues are only going up in value 8%. So if you are already in debt,…[Read more]

Are you saying the bank will give him an interest only loan with an offset account?

“..its kinda like saving 50k in the bank. in that 5yrs i could of just paid the interest on the loan and put that 50k into other investments and made further profits rather than it sitting on my mortgage doing nothing.”

That statement sums up the typical complete ignorance over interest only loans and why banks love people who taken them. The…[Read more]

It seems to depend alot on what is available and it can change extremely fast.

Recently got a property near waterford west for $255,000 after it was originally asking $269,000, this wan DEC06. Now the same type of houses are asking (and seemingly getting) $280,000 to $300,000 and the one brought is already valued at $22,000 more. It seems to…[Read more]

“The interest on you PPoR is not tax deductible, and it is normally much cheaper to rent unless you own your PPoR outright.”

That has to weighed up agains capital gains tax. If he rents the place out even for 1 day as I under stand it, he waves his right to no capital gains tax when he sells the unit.

Say the rent is $250 and his interest at the…[Read more]

I usually say for someone trying to pay off a home:

-Get 100% offset, take cash from here, get atm cards for this account, get it with no fees
-Direct salary crediting into offset account
-Have a credit card, pay for everything that is not cash with a credit card. Repay the card from the offset account before the interest free days are up. This…[Read more]

Basically it comes down to if or not you believe the combined value of the 500k property and your new ppor will go up in value more than the debt you will have of 8% interest. The answer to this is almost defaintly YES they will!

At the same time you have $200k in funds, does your money actually make more than 8% per year? I doupt it (after tax…[Read more]

This happens all the time. Infact most investors can only ever afford 2 properties because they negetive gear and simply don’t have the cash to go in any more.

You often hear stories of agents who also invest and in just a year or two they have large numbers of properties. When I look into most of them I found their income is collosally huge.…[Read more]

I think I missed something here, can you list each property how much you owe and how much it rents for and how much it is werth. For your post I get:

IP Melb $580k, owe 300k, rent ???
IP Syd $420k, owe 100k, rent ???
PPOR $???k, owe ???k, rent $260/wk

I think the safest and best way is to simply pay down your existing loan, then get another loan for an investment property. I know that sounds borring as it could take you another 10 years to pay off your house. The altnernative would be to sell your house and buy a house of around $300k. Then loan against it for an investment house.

The bank…[Read more]

We all know how well online polls work…

The securities commision and the stock exchange did a full look into australia investment in interest only investment, shares, property trusts and full residential outright purchases. The returns were extremely surprising. After inflation interest only investment made 1%. Full residential was about 3% and…[Read more]

I hate all the big channels here, especially the a current afair/today tonight type programs.

I remember this story about some property manager at a realestate agent. An owner wanted someone kicked out and gave the 60 day notice without reason, they weren’t on a lease. Well all hell broke loose and the rental person got some TV crew in to make…[Read more]