Solid queries by Terry.

I completely understand where the OP is coming from. When I first started investing, I also wanted to protect myself by establishing trusts. Luckily I spoke with with a few pros and eventually decided not to start my property investing journey via trusts mainly due to land tax costs, complicating serviceability, negative gearing issues and overall costs.

My personal opinion today is that trusts may be used later in the journey. This could be true also for the OP.

BRWT wrote:

Looking for feedback from anyone please,Brand new 4bd, 2 bth Home $490K excl Stamp, Solicitor etc……Rent Appraisal $385 pwAbout 20km out from CBD, and capital growth of 7% per annum,
or
2 Units, each has 2bdr, 1 bth, 1 carpark (both built in late 80’s early 90’s)Unit 1:Selling at $235kcurrently tenant at $295 pw (tenants happy to stay on board)Body corp $11 pw
Unit 2:Also selling at $235krent appraisal at $285pwBody corp $32pw
By the end of Sept 2016 I would have saved $70KI have NO assetsNo Loans, good credit historyCredit Card Limit $5000, amount owed right now is $500
Really stuck on this one. Havent spoken to anyone about this. Just wondering what is the best path to take. Your feed back is greatly appreciated.

Hi BRWT,

Colin is right. Nobody I reckon can give you an answer to the “what is the best path to take” without knowing more about your goals and also your financials (a few examples would include: would negative gearing hurt your next purchase? Do you even intend to make more purchases? Are you after cashflow?).

A few things that may be worth noting:

1. Banks look at your credit card limit, not the actual balance so if your borrowing power is borderline, it might be prudent to cancel the card all together (a mortgage broker or a lender can easily run scenarios with you, no worries).

2. One of the disadvantages I found with units is that you don’t have the same control as with a house. Tenants are complaining that the roof is leaking? With a house, you call a tradie and s/he fixes it. With a unit: you notify the body Corp, they might drag their feet, then source 3 quotes, then debate who to go with it and only then they book the chosen one. So what could take you 3 days to fix with a house is a 3 weeks saga with a unit (true story).

Hope this helps? :-)