Forum Replies Created
Hi Landt,
Well done – great to see the ‘fire in the belly’ again. As you said – another one will come along.
Out of interest how did your price compare to the auctioned price? Were you in the ball park? Was the property passed in or sold to the highest bidder?
Keep your eyes on this property there may be a disillusioned seller in the offing if the deal falls over.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Originally posted by jcls79:my property manager insisted that she can only evicted the tenant in 2 months because it is the official timeframe that tenants are given for eviction. The grounds for eviction is that the bathroom has been completely trashed
Hi John,
Not a PM but I reckon your soon to be PM is taking you for a ride. I suggest you grab a copy of the following document.
http://www.rta.qld.gov.au/zone_files/Docs/managing_general_tenancies_complete.pdf
My quick skim read tells me that you can proceed ahead of the two month period under section 169 and/or section 170.
As a word of caution as soon as the property settles move your PM – this one obviously doesn’t cut the mustard. Two months after considerable damage is clear indication of their inability.
As an aside – why didn’t you insist on ‘vacant possession’ as a condition of the settlement. If the damage was there at time of inspection alarm bells should have gone off. If, on the other hand, the damage has occured since your offer was accepted you may well have grounds to delay settlement until the damage is rectified and the tenant evicted. Certainly a question I would asking your solicitor on Monday.
Hopefully ‘the crest’ or ‘yasna and simon’ will log on prior to settlement day and provide some expert advice.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Matt,
Sounds you like you and your partner have most bases covered and best wishes for your collective investment journey.
You have chosen some good areas there – our research is pointing to a couple of those suburbs as being good long term buys.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958In terms of continued tax deductions the balance of the loan on your unit is all the interest that you will be able to claim as any redrawn funds or equity used will be for new new home and as such these funds are not deductible.
Originally posted by chockey:I have almost paid off the loan on my small unit, but want to use the equity on the small unit to fund the purchase on the larger house.
While I understand your reluctance to sell – if selling means you have a significantly lower debt on your new home then it may be an option worth considering.
The advantage you have is that your existing property will be CGT free and as such all profit will be yours to use excluding agents fees and stamp duty on the new purchase.
Is the desire for a new home such that you cannot wait? Have you thought about using the equity in your unit to help fund additional investments? Whether this is an appropriate course of action is dependent upon your goals and plans.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Originally posted by thecrest:What about later, when the agreement for the sale and purchase has been completed , are they no longer a party to an agreement to buy or sell because it’s been and gone, ?? They no longer own it, and there’s no agreement. how long do they remain in limbo ?
I suspect the line of thinking here is that the ‘party relationship’ exists ad infinitum when a tenant/landlord relationship exists immediately upon completion of the sale.
If on the other hand the previous owner came back as a tenant later I assume the Act would apply.
A question really for the legal beagles.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Originally posted by Bonnie:Can you tell me what the consequences could be by not being covered under the act.
Hi Bonnie,
This one slipped below the radar – sorry.
The Act is designed to provide ‘protection’ (if that is the right word) to landlords and tenants alike.
If there is a dispute between the two parties then the first reference point is the rental agreement – if this is unresolved or one party acts outside the agreement then there is a course of action that can be taken to resolve the matter at hand.
I would suspect under the circumstances you outlined – you (or your landlord) do not have a second point of reference.
As I indicated earlier – give the tenant’s advisory service a call. They may be able to shed light on the matter.
I also wonder whether or not this issue has become unnecessarily ‘bigger than Ben Hur’ – maybe a face to face reconcilatory meeting with the new owners may be in order. Just a thought.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Dazzling,
Cashflow positive they may be – but from a quick glance it appears they are all commercial or industrial.
Generally speaking most people who come here and ask where are the cf+ properties are usually confining their search to residential properties. Hence my response.
Whether or not they are prepared to consider other than residential is up to them as there are additional factors to be considered – maybe they need to carrot dangled as per your finds I am not sure.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi 39,
There are a number of ways that you can spend your $500K – where to best direct this is going to be determined by your personal presferences for cashflow or growth or a combination thereof.
As a broadbrushed statement if you are seeking cashflow from your investments then you will need to consider the strong possibility of buying out of Melbourne or, at best, spending considerable time looking closer to Melbourne and finding the property that has an untapped capacity that gives a better cashflow.
Alternatively you may prefer to adopt a longer term view and buy for growth. In this case you would need to see where you can best use your $500K. Look for something that has a consistent growth history and is as close to the city as you can comfortably afford and hold.
Now as to the question of how much to invest. Once again this will be largely determined by your goals, risk tolerance levels, income level, short and lng term needs and ultimately how the properties will help fund your later life. The answers to these questions will help you to fine tune what you could and should buy.
Depending upon whether or not your $500K is cash or borrowing capacity also has an impact on which course of action is best for you and what sort of leveraging levels you use, where you buy, whether it is single or multiple properties and so.
Given this will be your first property there are certain advantages to buying something close to home – but do not be seduced into buying close to home because it is close to home. Buy there by all means but make sure you make an investment decision and not a decision with your heart.
Similarly if your risk tolerance allows it do not necessarily confine yourself to your own area – unless it is a sound investment decision.
Hope this helps.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Arky,
If your wife does sell a property any gains made are added to her taxable income. So, if she isn’t earning anything then her sole taxable income is the gains made.
Furthermore if she has held the property for more then 12 months and 1 day (contract signing dates not sale dates) then she would only be taxed on half the gain.
Dale Gatherum Goss is a very cluey accountant – http://www.gatherumgoss.com. I am sure there are others.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Dan,
Suggest you download a copy of the ATO’s Rental Property Guide.
http://www.ato.gov.au/individuals/content.asp?doc=/content/42782.htm
It will address your questions for you.
PS Congrats on the purchase.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Arky,
I assume the property is in your home state of Victoria, as such I understand that it is possible to transfer property between spouses without incuring stamp duty. Now this opportunity may only exist when a PPOR is involved and may not extend to an investment property.
On this matter I suggest that you contact the Vic Office of State Revenue (or whatever it is called in Vic)
Buying your wife’s share off her is also a possibility – this will mean that your wife will incur CGT for the sale of her share but it might be worth considering.
I suggest you ask your accountant ‘how can I get to own the greater share of this property?’ – if they cannot answer of give options look elsewhere.
Please note I am not an accountant but you would also need to consider the costs V benefits of such a transference from a short and long term perspective – this is where a good accountant is critical.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Not John but there were some building companies that have so many orders that they will take some time to clear the backlog.
One display company (name escapes me) closed down or reduced their opening hours of their display homes to catch up.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Jenny,
As John has indicated the this property will still be subject to CGT as some of it’s life was spent as an IP.
The only saviour you have is if this property was originally your PPOR and you have moved out for a period of time of less than 6 years provided you did not buy another PPOR during this 6 year period.
Suggest you search the ATO website and download the CGT guide. It covers this scenario in some detail.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958I must admit I don’t know a thing about USA property investment but my alarm detector went off when you said This seminar presented by few American real estate agent.
For the life of me I cannot understand why these agents would feel the need to travel all the way to Australia to sell real estate.
As G7 indicated if USA is it for you – then PM westan.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi D,
I tend to agree with Beanie – get there and have a look around and get to know the area/s that you would be prepared to invest and/or buy into.
Assume that your rent is $250/week. Over a 6 month period this ‘bill’ will total $6.5K – money you could easily make up with a prudent buy.
The timeframes you are talking are nothing in the grand scheme of things.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Originally posted by Dazzling:I was staggered. Later in the evening the speaker admitted that they held exclusively to residential, had no idea about the myriad other types of property out there, but did say Kevin Young was dipping his toe in that water. In the same brochure handout Kevin is pictured saying he is now chasing CIP’s and IIP’s as the potential seems to be a tad better than what his club has been traditionally chasing.
Wasn’t a fly on the wall to your discussion but we did dabble in commercial stuff commencing middle (rough memory here) of last year – but it is fair to say the ‘take up’ rate wasn’t that flash.
Did get some interest in buying a commercial office block in downtown Brissy with a view to strataing (is there such a word) and entering into a pooled rent situation so all investors were protected against a vacant office syndrome.
As we know if your commercial tenant leaves finding a replacement tenant can be somewhat elongated even with the best research available. By contrast people gotta live somewhere.
I was invited to speak about C&IIP’s and what that could mean for the club members, but first I’d have to buy a residential unit from the club list. I politely declined and keenly watch as Kevin and his members try and climb up this new learning curve, which many people have already successfully climbed.
Not sure about the steep learning curve given that KY has been involved at a personal level in industrial, commercial and residential investments for close to 30 ish years.
It seems as if property investors are welcome to talk at the IC meetings, but only if you buy a club property first…regardless if that is the best for your portfolio.
Have you found that too Derek ??
No – have heard some great speakers at various forum – and I am dam certain they were not the owners of Club properties.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Wez,
Topics are locked for any number of reasons and as a moderator ‘we call it as we see it’
Certainly from a personal perspective I am mindful of not allowing discussion to transgress legal lines, nor degenerate into a he said/she said/you said dialogue that does nothing to the topic being discussed, or being watchful for those threads that degenerate into personal attacks (some people just want to have the last word and a ‘lock’ is sometimes the sole strategy we have).
Having your say is fine – but any of the above are not acceptable. Simple really.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Wilko,
I actually wonder whether or not FPs/FAs are of value to people who possess a financial awareness within themselves.
My personal experiences were less than satisfactory and I would fit into the decidely unhappy category – the last FA/FP I spoke to tried to dissuade me from property while at the same time encouraging me to put my hard earned into extra super and/or a managed fund he had specifically selected for me (yeh right). Needless to say we are by far and away much further ahead now through property than the path he was trying to steer us down.
By way of personal example I have a plan that focusses on property as the core of my investments.
I manage my cash carefully and know what latitude we have to invest with. I also keep a track on asset values and define a 12 month plan for the family (they are involved too) which is consistent with our long term goal/s.
A careful budget and 6 monthly reviews keep us on track while still giving capacity to kick our heels up from time to time.
Running parallel with our residential property are some expansions into a commercial development, a share fund and some drect shares. Nevertheless property is still the core of our investment strategy.
Given we don’t know what your investment preferences are it is a little hard to comment on whether or not a FP/FA can do what it is you want.
For example if you are focussed on property as your investment vehicle I am sure that you could find someone that could assist in this regard (it is something we do all the time).
However if you wanted to branch out into shares etc then the counsel of a broker or suitably qualified person would be to your advantage.
Bear in mind that, as far as I know, run of the mill accountants are not necessarily qualified to give finacial advice as such. It is an outcome of government legislation. Sure they can help you manage you tax affairs, assets and cashflow but I am not so sure about giving FA.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Is it also possible that the bank/LMI provider see the town as too great a risk to their money and that is whay they won’t lend to 95%?
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi MC,
While I understand where you are coming from – I still cannot reconcile the conservative bones in my body.
Approach the matter from a worst case scenario; you don’t get the job, you are terminated and cannot find another job, what will you do then?
I go back to the initial comments – there will be others and time is on your side – but then I am just a conservative old f….[biggrin]
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958
