Forum Replies Created
i have searched hours for the formula with no avail, i keep trying to make it but fail each time!
would love to see one or if i success i will post it here
Josh
Hi Anthony,
From first glance it looks like a tighter situation to move forward but i wouldn’t say it is impossible. let me strategise for a minute here, its what i do for a job!
First thing would be the valuation on your house. Did you only get one real estate agent around? i would get 5! or a $200 professional Valuation is a very good investment. this could increase what equity you believe is there and provide a deposit and buffer for moving forward.
Your tax return this year will be a great thing to have in your bank account too. Do you have a depreciation schedule? how old is the property?
Assuming you can get a better perspective on the valuation, and potentially a depreciation report (depending on the age of the property) this could change your cash flow. I would then get a tax variation form which will allow you to apply any losses against your weekly salary insteas of waiting until the EOFY to make this claim. What this would do is increase your monthly cash flow and potentially make you look better for the banks potentially.
Assuming you can now move forward, i would look at a property that wont cost you anymore money to hold and is in an areas set for good short term growth with long term security. With the right team around you i think you can move forward here but it will be tight.
You asked for non biased views here, i guess this is my personal opinion but also what i do for clients so there would be an element of biasedness in the fact that this is as strategy that i have to deal with quite often and i use a fairly similar structure for most people in this situation.
Cheers,
Josh Atherton
[email protected]Pommy Ian,
it depends how long you want to keep this property. I am not making any predictions don’t get me wrong here. I would do your research into the construction workforce and the long term workforce of the projects that are / being planned to happen.
What i mean by this is to ensure that over the next 5 years the projects may employ 5000 people for instance (I am making numbers up for samples sake here) however when all of the infrastructure is in place this workforce can quite often be reduced by 30-50% with many mining projects. To be a good investor in mining areas it is very important to do your due diligence more than ever. The mining industry is strong and will be for many years to come (quite possible the rest of my life anyway, im 25) so its not too risky, its just a matter of picking the best spots for growth and rental returns.
I have 15 investment properties all in central QLD and have made in the millions within 5 years, so my advice, do your due-diligence, look at EVERY option, not just what the banks and magazines look at and go with your head and what your’e comfortable with. The MOST important thing to do when investing in central QLD is to get a team around you who know what they are doing in the area when it comes to investing in property. I have seen hundreds of people get screwed over in these regions as developer/builders/agents saw them coming.
Let me know if you want to pick my brain at all, Best of luck!
Cheers,
Josh
Hi Debbie,
I own a property investment business and am based in Noosa Heads. Without trying to sell you a property here our network/team are all based on the sunshine coast and provide their own professional experience and charge accordingly as any other professional may. I am always happy to help a local and sit down and have a coffee and run through how i hold 15 properties at once. It is quite easy once you crunch the numbers and make everything work to your advantage.
If you need a good accountant on the coast to maximise your gains and do the Variation Form than i am happy to refer you to mine.
property investing is easy when you have the right team around you who know what they are talking about and are all experienced in property. Anyway the offer is there. No skin off my nose either which way if you wanted some advise in general in person.
Good luck!
Josh
Qlds007 wrote:Hi JoshWould slightly disagree as if Johny buys them in his own name with next to nothing by way of income he wont have anything to claim anyway. If he buys them in his partners name then this could be different.
Remember any Capital Allowance that is claimed reduced the Cost Base down the track should the Asset be sold.
Cheers
Yours in Finance
Hi Richard,
Once again I assumed that the house would be in the partners name (as the house which they will gain equity from) and the serviceability is provided solely by her, not Johnny. I would take it by your previous comment that Johny may not be able to borrow money due to his work potentially ceasing. This then provides an income of at least $80,000 to apply tax deductions to.
I understand that any capital purchase applies to the cost base once sold. However, this is still hard costs that must be funded in the mean time. The point I am trying to make is that if the reason for such an investment is to make money (which one would assume is the case) in both yields and capital growth, then this may not be the most cost effective option that provides the best short, medium and long term ROI.
Cheers,
Josh
Qlds007 wrote:Hi JoshIf Johhny buys the property in Trust he cannot claim the Depreciation anyway so buying an older property and renovating is not going to make any difference to his strategy as the idea is to generate income not Tax deductions.
Cheers
Yours in Finance
Hi Richard,
Sorry i didnt make my point to clear there, if it was me i would be aiming to buy the properties in personal names here. I say this due to Johnys desire to build a portfolio, so over the course of 5 or 6 properties the depreciation benefits could be substantial. Whats your thought on this?
Josh
Hi Johny,
Firstly i would look seriously at the renovation aspect of your strategy. I know it can provide some good initial capital gains, however i would firstly look at the tax benefits it may bring. There are two people who should be paying your investment property off for you. 1. Tax Office 2. Tenant. I am assuming you may spend $50k or so renovating? being an older property, albeit a renovation in progress, you could assume that depreciation might be small. This property sounds like it will leave you with a significant shortfall on annual holding costs each year. If this is the case, it may hinder your potential to move forward when you may desire in raising finance to purchase another property to grow your portfolio.
In this economy there are many properties that will help you minimise your partners tax as well as achieve a much higher rent in high growth suburbs/regions.
I know this isnt a direct answer to your question but i hope it is some food for thought.
Regards,
Josh Atherton
M Y wrote:Hi everyone,
I’m heading up to Blackwater in a couple of weeks time to have a look around and maybe an investment property.Does any one have any tips of where to buy or where not to buy? Anything I need to watch out for while I’m there?
Thank you
MY
Hi MY,
To start with you have chosen the right area to invest in. I have 10 properties in the Bowen basin alone. I have lived there also and was a real estate agent in Emerald for a number of years. if i can give any piece of advise it would be to consider areas within the Bowen basin that attract more than just miners. There are key areas throughout Central Queensland that will experience unprecedented amounts of growth due to the capital expenditure of the minerals and resources sector.
Emerald is a town that has a significant amount of diversification and is quite often overlooked due to slightly lower rental yields, however a significantly higher level of security. If you buy the right property in Emerald you should have it neutrally or positively geared easily enough. Out of all the towns in the Bowen Basin, Emerald suffered the least amount of damage during the GFC. There were no problems with renting properties out as long as you were realistic. It is currently experiencing a massive amount of growth in the town.
Woolworths are spending $120m on a new shopping centre, Harvey Norman has confirmed a site, Bunnings is shopping around etc. They will be upgrading the airport runway soon to fit Boeing 747’s. Emerald is quickly becoming a regional powerhouse in what it offers the 66,000 population currently living in the Central Highlands Regional Council.
For me, Blackwater is not diverse enough. What if something happens and you need to sell quickly when things may go quite for small periods of time. It depends on what exit strategy you have in place for your portfolio but i would consider somewhere more diverse whilst still capitalising on the minerals and resources boom. towns like Blackwater have a MASSIVE investor owner ratio, this means you are relying on investors to always be active to buy your property if you sell. Focus on an area with majority owner occupier ratios could make a more risk adverse investment for the long term and short term.
Hope this helps,
Josh
