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ask your bank if they can issue a deposit bond. this is a financial instrument that the basically shows the auctioneer that the bank knows you are good for the money and will cover the deposit if you fail to. I haven’t done this myself it is from finance theory .
I think rexilla may be refering to the cost of borrowing which can be claimed over a certain time period. You need to check with an accountant. Also if you pay interest on the loan, council rates and water you can reduce your total income. If the interest and costs like insurance, rates, water are greater than the rent you can reduce other income you earn – this is known as negative gearing. If you are positive geared the expenses will reduce your tax liability as they were expenses incurred to earn the rental income. If the building is new you may be able to claim building depreciation check this out with an accountant or visit http://www.ato.gov.au.
If the person borrowed money to do so improvements on the house they could also claim depreciation which would reduce their tax but it would reduce their cost base in regards to CGT at a later date when selling.
http://www.simplybudgets.com/
This was featured on one of the current affair programs a long time ago. I have no idea what it costs.If you sell the property consider the effect this will have on Child endowement, Parenting payment pension and Child care benefits.
Also capital gains tax implications need to be considered.look at the values of the other 11 properties as compared to what is owed. You may find you can sell a couple of properties and have enough left over after capital gains tax and debt is paid to get yourself out of the dilema you are now in.
http://www.residex.com.au
cheaper option buy API magazine it is usually in the back section
reiv in victoria sells 10 years of historic valuesCapital gain = sell price minus base cost
Base cost is what it cost you to buy the asset usually purchase cost plus buying costs. If you make a capital improvement this may be able to be added to your base cost. however if you depreciate or claim buying costs as a tax deduction it is removed from your cost base.
Look up http://www.ato.gov.au for current tax laws on capital gain. If you hold the asset for 12 months you may be able to reduce the gain by 50%
you will need to check if this is still the case. If you want to know the capital gain seek a property valuer to give you an estimate on the renovated likely sell price.It would be a good idea to talk to an accountant. A 50 / 50 joint ownership can split the capital gain between two people or look at buying in lower income earners name.Squared area of each room . If you need carpet it is going to be quoted to you in Squared metres. Paint will be squared metres of walls.
try subscribing to http://www.apimagazine.com.au or buy it at the newsagent it is called Australian Property Investor Magazine.
A wedding is a very important event for your fiancee who has waiting for this event all her life. Be patient as the wedding will be the only thing on her mind at the moment. Once children are thought of your wife will want to finacially secure future for your future children.if the lawn mower person cut his foot off while mowing on your property who would he sue the property owner.
look at taking out Land Lords insurance to protect you from loss of rent, malicious damage, public liability and find a good real estate agent. If the one you have is not cutting it find a new one.
If you have the property managed by a real estate agent keep the property listed as available to rent.
You may be able to increase the new tenant’s start date so that the kitchen and bathroom are completed before the tenant moves in to reduce the disruption to the new tenant. The carport could be added to the lease agreement that you are going to install a carport even if the property is tenanted as the disruption would be less. You will need to arrange electricity to be connected for your trade persons and then have the electricity disconnected before the new tentants start renting your property.
By having the property listed it is still an available rental property. I am currently repairing a rental property’s bathroom shower and vinyl floor in the kitchen plus installing a rangehood while still listing the property that has already gained a new tenant who will move in once the bathroom is completed.This also reduces the down time of your rental property. If you have an agent managing the property you can ask them to find the trade people you need to achieve the repairs and improvements.If you do not have lots of equity then selling will release not very much money as you will have to pay the bank back what you owe on the house and pay commission,title discharge,solicitor fees . If you rent you are missing the opportunity for capital appreciation of the home you live in which would be cgt exempt. Mortgage repayments would be on a seperate loan which is cross colateralised from the home you owe. You would pay repayments on the new loan as well as on the loan for the house you live in.
Renting has the advantage of not having to pay out for repairs and pay a mortgage but has the disadvantage of no capital appreciation.
Two mortgages increases your financial risk !!This is general advice you should consult a licenced financial advisor who will also consider your personal financial situation before giving you advice.
If you do the reno and then rent out the property the reno will be classified as an improvement and depreciation can be claimed over the effective life of the items. If you do a reno at the end the improvement costs can be added to your cost base. This means that your overall cgt will be reduced by the costs of improvements. However under tax law you can claim depreciation or repairs or an increased cost base but not both depreciation/repairs and increased capital cost base improvements. It is one or the other !!
Large repairs will be classified as improvements – like replacing a whole roof or replacing the whole carpet. Any repair that is an improvement over the state of an item at time of purchase will be deemed as an improvement by the ATO.
This is general advice you should consult a good accountant as some repairs can be deemed as an improvement- this is a grey area (not black or white) of Tax law and also check http://www.ato.gov.au to see if there are any guides from the tax office on this subject.As the dog could cause the neighbour injury it may help to explain the reason for the new fence is to protect the neighbour or their children from any potential dog attacks. It may be that you will have to go ahead a replace the fence at your cost to protect you against a duty of care public liability claim caused by a dog attack.
I look in the newspaper or real estate web sites for a similiar properties in the same area that is being advertised for rent to estimate the rental market.
Another way is to go to the area and look at the rentals the real estate office has.non preserved payments are the payments you made with after tax money. When you work and have payments made by your employer the money hasn’t been taxed so $1 earned equals $1 invested. At a tax rate of 20% $1 earned is 80 cents invested and 20% taxed.
the unrestricted refers to non preserved payments prior to a law change in Jul 1999 where now any money invested stays in the super fund till retirement. I am not 100 percent sure on the date of jul 1999 it could have been jul 2000. There are so many law changes I would have to read up on them as 1984 was another year where major law changes occurred on the taxing of super payouts.$20,000 at 7% interest is $1400 a year you could organise with the bank to reduce your repayments per year by through saving on your home loan interest. Another important factor is you are on a pension if you spend $1400 a year on a holiday from the interest savings that won’t be seen as income and the $20,000 paid off the loan won’t be seen as assets which can affect your pension payment. You can only spend the 20,000 once where as you can spend $1400 per year for however long the home loan has left in its repayment term.
If interest rates increase in the future it will only be on $10000 rather than $30000 giving you some breathing room.Interest costs won’t apply until Settlement occurs. You may be able to use a deposit bond instead of cash and invest the 5000 in a bank account with the bank earning interest as collateral for the deposit bond. The bond would cost you to use it but it means you do not tie up your money / or you may have equity in another property you could use as collateral for the bond. I haven’t tried this myself but know the theory of this type of financial instrument. might be Worth asking about at the bank.
