Forum Replies Created
Hee Hee No Idea
Thank you both for your input. I will continue with the multitude of phone calls.
I guess what I am struggling with at present is this.
Lets say during the day my system generates 5KVA of power. At night nothing.
My usage is more like 2KVA per day and 5KVA at night.So if I work on totals I am drawing 2KVA per day that I must pay for (well that would be the case if for example the power was stored)
If I work on the fact that it is not stored anywhere (currently) then I am giving them 3KVA per day and then paying them for 5KVA at night… Surely not
Sooo….. when my meter runs backwards it tells me that I am putting power into the grid (which I am currently not being paid for..) however it also winds back my meter usage.. So I must be receiving some benefit? If I understand correctly I am getting the benefit of 1:1 however if it were going into the grid I would get 2:1? (or similar). So I am missing out on the difference.
However if my system only makes 5KVA per day and I use 7KVA per day…… owe my head hurts!
thanks Terry I will have a talk with the members involved and see what they think the future use may be.
I am guessing the benificery will reside in it as PPOR for a few years and then likely sell. In this situation would it be correct to say that no tax would be payable?
If it were suggested that the home be rented would it be a good idea to value the house at the passing so that any CGT is calculated based on the value at the time of acquision and sale rather than the value that the home was orifinal purchased for by the deceased?
Thanks for you help.. much appreciated.
I will have to look up the trust structure you refer to as it sounds like you speaking a foreign language to me at present.
So do I have to re-do my loans and insurance using them as brokers?
I just cant understand… I understand that there are commissions payable in the industries of finance and insurance. I understand that if I dont use a broker the bank or the bank consultant recieves these commissions. I tend to think that fair enough, thats how they earn they pay packet (well maybe not the bank but the broker and or the consultant etc). If I use one of these companies what do they do contact NAB and my bank manager and say by the way you know those commissions you get paid, well we are going to take them and give them back to the client…. dont suppose that make my bank manager very happy.. and wont it send all the brokers broke?
What am I missing
Hello Terry,
I was wondering about the situation whereby an elderly relative wants to leave their PPOR to a family meber.
I have read on here before advice about this – something along the lines of the transfer of ownership post death would incurr stamp duty and tax however the elderly can gift a certain percentage each year pre death avoiding this?I see plenty of positives to using such a company.. hey even if they keep some its money that I didnt have before.
But what are the negatives.. surely there are negatives!
a quick questions if I may fword and ummester… fword you state (sorry dont know how to make it do what you do)
"(24% or so) of Australian households being renters and without a mortgage. Furthermore, another some 30% of Australian households fully own their home with no mortgage on it whatsoever"
Can you further clarify where these numbers come from? Is it the section of the market that is not under 18 etc or is it the whole population? The reason I ask is the numbers seem high.. If we then take out the kids it seems that the motgage holders are actually the minority. (whats the percentage?)
If this is true why is it that govt and RBA use interest rates to slow the economy…?
I'm confused, did Americans stop breeding? No wonder they so cranky… hee hee hee (just playing
)I didnt take up the offer (no flights included).
However a free week in Thailand is appealing. Maybe next time I'll call and say 'include the flights and I'm there!' hee hee
I must be missing something. I have flicked through the OCT API mag a few times looking for Richard's article, but I cannot find?
directions or page number please?How did you go itsAndrew?
I realise I am in a different state and things might be diferent but out of interest I asked an RE friend of mine yesterday.
He advised that In my state QLD, if you terminate due to the building and pest clause after the cooling off but before the expiry of the building and pest condition date, then no termination penalty should apply.
So the question would be – did you terminate during the cooling off period?
What was the specific wording of the building and pest clause?
In QLD the contract has a warning statement (30C). In this statement it says that if the purchaser withdraws during the cooling off period the seller must refund your deposit within 14days BUT may deduct a termination penalty equal to .25% of the purchase price.
So I guess the grey area is if you terminate after the cooling off period expiry but before it goes unconditional… hmmm?
It sounds like the answer to your question is going to be in the wording of that building and pest clause (this is the sort of stuff that worries me.. I need to get a clear set of appropriately written clauses).
It is the termination penalty that has discouraged me from submitting offers.. Agents often ask me to put the offer in writing by this they mean they want to present the seller the offer in the form of a signed contract and they say stronger offer with deposit also. I understand this and would be happy to do so but this .25% (which they say is never charged) deters me, seems to easy to get in the situation your in…
Is it better not to pay the deposit until conditions have been met?
Is it better to add a clause to contracts to counteract this termination penalty.. is that even possible?
Is it just exectionally important have the words 'satisfactory to the buyer' in the clause.. but then as Jamie M says, what does satisfactory mean…Hmmmmmmmm
Thanks Derek, appreciate it…. so when you asked what my gearing level was.. the answer was I am 80% geared (meaning I have borrowed 80% of the value of what I have)
Hello Sparkys,
a couple of quick points for consideration.. generally speaking I think there may be a few additional cost (looked into something similar myself)
1) I dont think many agents sell their own homes. Not because they cant, but because it becomes hard to be objective and thus a good negotiator for the deal. I think in some states there are some beneficial interest issues to consider also.
2) If you want to be licensed to sell, ontop of the licence course fees you have the licence registration fees (not sure in your state, not cheap in mine)
3) alot of the information RE use to assist in property values is available to the public in the same way it is available to those licenced… for a priceTC62 has some good points about the tenacy laws this would be very beneficial. I think you can download the act for free off the net.
Perhaps you can get hold of an RE's notes from the licence course and read the sections that will help skipping the cost and time on those that are not beneficial..
Yes thanks Derek,
I am not 100% sure I know the answer…. perhaps you can help
My PPOR is currently bank valued at $400,000
My loan is $302,000 IO and I have $13,000 in the offsett.
I have also got an LOC (equity) of $18,000 taking me upto 80% LVRWhat does that make my overall gearing?
I was considering using the $13k and the $18k LOC to purchase an IP under $250k, this would be at LVR 95% (not consolidated with PPOR) thus would also be utilising LMI.
I have a pre-approval for this and can service but I am pushing things a little. My PPOR consumes about 40% of my nett wage income and the IP would likely consume another 20%. I can do this but would be in a difficult place is I lost my job for example. I am not risk adverse and am entertaining this idea as I wish to get ahead however I need to be confident that the rewards justify the risk.
Over the weekend I have been thinking that whilst the market is oportune for me to negotiate a good deal, and I could possibly just do it. I perhaps need to take a little more time and save some more money. If one cant afford to fix the leaking bathroom in the PPOR one perhaps is not financial enough to consider and IP?
I am leaning towards saving some more in the offset. When I can afford it put in the shed, this will deplete my offset but hopefully improve my equity thus enable me to increase the LOC amount. If the LOC amount improves then I might be able to afford a newer home that would aid in depreciation and tax benefits. I am thinking that it is okay if I miss the property cycle low here because I will have time to research other areas in other states and perhaps their market conditions will be good for me when I am ready.
I am really focused on having what little money I have invested in areas that are working for me!
Any advise is most welcomed.
Nope not lost.. I dont think! Thank you so much for coming to my aid.
I have been using a negative gearing calculator I found and I can see that my out of pocket costs are halved due to the tax benefits. I think one of the challenges I may be having is that my budget (at the moment) is low therefore the homes are old and thus no depreciation. Maybe I need to wait a bit longer and save a few more pennies?
I understand leverage and I understand a little about tax benefits but with market conditions as they are it seems that unless I can obtain at least 6% rental return and 6% annual captial growth my money is better off saving me the 7% interest.
But I just keep going around and around in circles.
My spreadsheets are telling me that the return on property (at the moment, in my price bracket) is not that great (I could find myself spending years under pressure trying to make mortgage payments and not make any great profits) but my head and my experience is saying that with leverage 2 properties increasing in value is better than one. I cant figure out which one is right!
And maybe it is that the answer lies in 'what happens in the future' and thus would be determined by my condidence in what is coming. Or perhaps it is that the reality of the money game can be deceptive, no point making good profits if those profits are being eroded by the cost of the borrowing in order to hold the property.
Owe……………. I need a bucket of wine
What the… I have used two of NAB's loan calculators with the same figures getting different answers…grrr
Okay, this has been doing my head in…. I think I am near the end, anyone
Unless I jag a bargain IP's in my current price range will require me to input around $500pm. If I calculate putting in that much for 9yrs and I calculate the estimated value of the property in 2020. I can see that I would need 5% property growth p/a to earn myself $74,000 in equity. (profit).
If I put that $500pm for 9 yrs into my PPOR loan (or offset) I would save myself approx $88,000 plus 6yrs
If I put some money into a shed I probably earn myself about $31k over the same timeframe.
Seems pretty clear cut.. (please correct me if I am wrong) By putting extra funds into my PPOR loan offsett I am saving myself 7% interest (the effective equal of me earning NETT yeild of 7% from investment property?)
In order for an IP to present as a better alternative to this it would need to somehow yield gross 12% (combining rental income and capital growth) Therefore if I achieved my goal of finding an IP with a yeild of say 6% I would need be confident that the annual capital growth percentage would be 6%?
Sooooo… if all this is correct I now better understand the importance of selecting the right property, one must be confident in the future growth or feel confident in their ability to create it through reno etc.
How am I going here guys, am I on the right track or am I missing a major component?
Thanks pinkboy,
Seems I had the math just not the approprate formatting in my spreadsheet.. All fixed thanks again
I am not for nor against brokers…
Brokers I feel are tarnished a little with the same brush that affects real estate agents, car sales, finance and tax advisors etc.
I think the truth of the matter is that there are good ones and not so good ones (not unlike any other profession). There are people who are genuine, committed, educated and willing to work hard to get you the best deal possible and there are others that are tired or lazy or perhaps struggling with other issues in their life that may not care so much or work so hard for you. Some are inspired to do good and others are just trying to find a way to put bread on the table.
Herein lies the difference (IMO) a good broker will get you a better deal (whether that be structure, rates, future borrowing potential etc) an average broker will likely get you the same result you could get yourself. (not unlike a tax agent)
So therefore the question becomes how to you find a good one… I havent used anyone on this site yet but their commitment to the site and their willingness to share what they know demonstrates to me that they are not the average broker. I would think meeting with a few and asking them their thoughts and having them explain what they can do for you might give you a better indication as to whether that particular broker is good for you.
In my area I have not as yet found what I call a good broker (hopefully they are out there). I work direct with my bank manager by rely heavily on support of this site. A concern for me is that to my mind one of the good qualities of a quality broker is that they have good working relationships with the lenders, with that in mind I have to date been uncertain whether a broker outside of my area can better facilitate lending than one in my area? (sometimes the local branch manager has to go into bat against the corporate office in order to support lending in regional areas)…
My two cents..
Is this one of those questions that only I can answer?
Anyone got any views as to what they would do in my situation?
