Forum Replies Created
Its a tough one if you’re on a budget…
We had alarm fitted to a brand new IP and it got broken into in the first week after tenants moved in.
The broke in at night with tenants in situ with the alarm turned off.Stole a computer and car+house keys and a wallet.We had to change all the door locks.
Tenants were so scared they moved out, and the intruders came back 3 days later, this time they broke a window trying to get in.
So we added security screens to the sliding windows only.
Have had no problems since, but the reality is if they want to get in they will. Either through the roof or by smashing a window/door.
Amazing how few people see or hear anything when a burgulary is occuring.
Big Black Hungry Dog sound good to me, preferably one that does not bark but BITES really hard…
after all the Police are no help in these situations..100% failure rate in my experience.KP
No, please explain…..
Ummmm,
The market is supposed to be flat to going backwards… where is all this capital growth going to come from in the immediate future ??There is nothing wrong with selling and taking a profit from time to time..
KP
Tristan,
have you got your Credit Providers Licence ?
Its illegal to vendor finance in WA without one..Better for you to do some homework before you get involved…
KP
No takers Marisa,
must be the Wait Awhile factor….
I was in touch with someone who is currently going for his CPL to start wrapping in WA
He gave me the name of someone who is supposedly successfully wrapping in Perth.
CAn give you details if you are interested.
Cheers
KPPhil,
It starts when you buy the land.
Have just completed such a project and the accountant confirmed its the land purchase contract date that determines the CGT trigger date.Julia: you must be a walking ATO dictionary !!!
Amazing……KP
Thanks for the info Richard.
I understand stamp duty for the wrapper is triggered prior to settlement.
I meant as far a the wrapee is concerned, when do they pay stamp duty…on entering into the terms contract, or when they finalise the terms contract or refinance(ie.. when their name goes on the title deed)
Thanks,
KPOh Dear,
I wasn’t going to buy back into this..and neither were you Monopoly (bad gurl)
So from your example Kay, a gross taxable income of $100k reducing to $20k (difference of $80k) results in a tax difference of $40k to $2.5k.( tax refund of $37.5k)
Therfore you have to fork out anything up to the $80k ( admittedly less with depreciation expenses) to get back $37.5k.
There is still a HUGE shortfall between the two, which unless you manage to recover at some point in the future, means that you are going backwards in real dollars!!
And cramping your lifestyle by the reduced cashflow, in the process, for the sake of what ? paying less tax ?? This is not REAL investing….KP
hsmedia,
Why do you want to sell the properties ?
Is there a problem with them ?KP
I am not an agent, but I think its a bit one sided and even harsh to say that the agent does nothing ( house sells itself)
I too, have an IP for sale (90 days, no result)
and the feedback I am getting from various agents is that there are only 2 things which determine if a property sells or doesn’t sell.
One is no doubt the price, the other is the agent.
If you have established that the price is realistic, ( market comparison, sworn valuation, replacement cost of land plus building, etc,)then the ability of the agent to sell it is the problem.
Not all buyers are experts or knowledgable on prices and value, regardless of what the experts here say.
Those buyers rely on the agent to guide them through the buying process including what price to offer.
A trusted agent with a good reputation and a proven track record will always manage to sell a property that another agent might struggle to sell. This has been my experience.
Unfortunately, when the market slows a bit, as per present, some sellers lose their nerve and start caving in to requests to lower the asking price.
Thats how the cleaver buyers manage to buy 10 and 20% below market !!If you can afford to hang on ( don’t have to sell) then stick to your price, otherwise lower it till you ferret out a bargain hunter…
By the way, if the agent is in breach of any of the codes of conduct/ethics, etc, then you are within your rights to terminate the selling agency early.
Try reading the contract first or get someone to help you with it…..KP
Hi SPT,
Seeing as you have the cashflow to fund the debt, why not consider buying old house on block zoned duplex.
Then build two (or add one if you can retain the existing house)
You then have choice of keeping both for rental or keep one sell one to reduce debt.
You end up with new property which will have minimal maintenance costs and maximum depreciation deductions.
Only downside is that you have to fund the borrowings during construction with no tenant to help cashflow, but the interest cost is deductible during the whole process ( tax ruling based on the Steele case)as long as the intent of the purchase/development was to build an income producing property.
I have found this speeds up the equity process without having to wait for the market to increase/improve, by tapping and realising the potential of the land value via the subdivision process..Cheers, KP
Thanks Monopoly,
I thought it made sense.
Kay H, can you clarify what you mean by “you get back more in a lower tax bracket”
Its a serious question, as I don’t understand what you mean… unless I have nissed something..KP
DItto to Acey’s reply.
PS.. have you jumed ship from the other forun Acey ?
KP
Mellis…
Can you add a First Home Owners Grant to it ?Just a thought.
KP
Unless your tax deductions are “non cost” deductions like depreciation for example, then it is self delusional to say that reducing the tax you pay such that you end up in a lower tax bracket is effective.
You are in effect spending a dollar to get 48.5c back in the top bracket, and spending a dollar to get back even less in the lower tax brackets.
The balance of those dollars spent has to be recovered sometime in the future presumably, by means of capital growth, which is not always guaranteed.
There is an optimum time to negative gear, neutral gear, or positive gear.
A word with a good financial planner will clear this up for any confused bunnies out there.
As for the property market going into meltdown, it,ll never happen.
Not unless people decide to stop living in houses.
There is more to the market then a few overstretched investors losing their properties, or their shirts off their backs, or their jobs, or, whatever…
Even rising interest rates will not cause a property meltdown.
The market operates in a cycle and this part of the cycle and what is to follow has been seen before….many times.
Take a Bex and have a lie dow John H, it will all be over soon.KP
Yep Monopoly,
I agree the 7% is a good rate but it is an exception and not the rule.
Standard seems to be 8 to 8.5%
And you still cop all the extra costs which seem to be included in the management fee in Vic, etc.
Thats the annoying bit as far as I am concerned…Got it…
Thanks JuliaSomeone forgot to tell WA that the property market is cooling. (maybe it really does stand for Wait Awhile)
Prices have slowed down but have not retreated, and according to 3 agents I have spoken to, there is an acute shortage of listings….40% below average…
So far its business as usual….maybe our crash comes later…KP
I,m like you Helen,
I needed to understand the process…so I did one on my own. Had one minor hiccup which resulted in a delayed settlement, but beyond that it was a painless process.
In fact the vendor also represented themselves, so it wasn,t that big a deal.
Basically, four persons (two bank representatives, a purchaser and a vendor)sat around a table and exchanged cheques, title deeds and transfer documents and once all parties were satisfied (5 mins) we all went our seperate ways.I understand things can go wrong, so would not tempt fate and do another one on my own, but doing one was a worthwhile experience.
KP
Hello Julia,
I too must be thick..
Can you clarify a couple of points pls:You mentioned that income stream prior to the wrap contract is rent but post the contract is P&I repayment. if you’re on selling the property to a wrapee surely they would occupy once the contract was in place and hence the repayment will be P&i. When will it be rent ?
You mentioned at settlement the purchaser pays the balance owing minus the monthly repayments made to date.
Can you confirm that it is only the principal portion of the monthly repayment that the settlement amount is reduced by ?( not the total repayment which includes interest)
Finally, is CGT liability paid at this point (at settlement)?
THanks, KP
