Hi, if you sell immediately or off plan, all profits are 'trade profits' on which you pay normal tax. Then you have to pay GST as well 10% minus what you paid out to others in the process of building. On a $300000 house, you roughly pay $13000 GST. [approximate only]If you keep the houses for more than 1 year, you probably pay CGT (50% OF PROFIT)…[Read more]

Hi, nothing wrong with having money in the bank either! $1M still means $80K without having to work for it!The good investment will turn up, no problem. Keep looking.KY

Good advice from Terry.Ky

Hi, I'll like to emulate your style! How on earth do you get a tenant to absorb a 50% increase?KY

Hi Dave, are you at the point where you are paving/driveway & crossover?I hope you know about the crossover. The council took 3 weeks to give us a quote then I rushed to them to find out that the contractors were booked out to end Feb. (this was pre Xmas!)I panicked, so stricken I looked the girls at the council reception rushed to help me. Boy,…[Read more]

Hi, developing isn't as easy as it's made out to be. You make a lot of money if property prices escalate while you're developing. Not all developers are out to offer low prices. With your kind of development, it's likely to be a small developer of the mum & dad variety, probably with some handyman skill.I sold my project to another 'developer'…[Read more]

Hi, I bought the Ed Chan book on super & while it's easy to read, it's a tad too general for my purposes. I would expect at least a couple of appendices on things like contributions tax. I'm still in the throes of a broadsheet to try & decide what savings I'd get from transferring commercial properties into a super fund at the same time offsetting…[Read more]

Hi Eddie, I've been to a meeting run by Iron Fish. They were marketing a couple of quite big projects in Adelaide. The Newport Quays & some houses at Andrews Farm. I have property near Newport Quays & while I'm glad they lift the area & add value to the peninsula as a whole, I don't think they make very good investment options at the moment. I…[Read more]

Hi, you're in an enviable position as you can borrow at home loan terms.Hypothetically, let's say you borrow $300000 and buy IP [doesn't really matter if it's residential or commercial except that you'll have to hunt high & low for a commercial property @ $300000]At 5% yield, the income = $15000 p.a. Add $4000 outgoings i.e. $11000 -ve gearing of…[Read more]

Hi, you need to first check the zoning. What does the council allow you to do? There's a block in Blackwood 2600m2 of flat land & it could not be sub-divided because the council regards it as rural. this is 18km from the CBD in a hills area that's suburban & has hundreds of conventional houses & more than 20000 residents.At $400K for the cost of…[Read more]

Hi, a good conveyancer does a far better job than a cheap lawyer, mainly because the conveyancer knows all about conveyancing. I once took the option of peace of mind with a solicitor, cost me four and a half thousand, my conveyancer charged me $300. The solicitor didn't do a better job [she's my niece, a very smart girl by the way]. Since then,…[Read more]

Hi, I once had the same issue. My PM didn't suggest I paid for the tenant's comfort. If he wants air con, he pays.What we had before the tenant moved in was an evaporative air cooler [the water ones] that we placed at the open window & it'd draw the cool air throughtout the house. Was very effective. only needed it for 2 weeks a year anyway. Cost…[Read more]

Hi, been there, done that.Share with you what I did. I plonked all my money down on a house, ran out of money & borrowed from a private lender. 2% more than the banks charged but it's fixed. The risk is the balloon repayment. LVR lower than normal. About 60%.I was totally confident I could walk back into a high paying job, and did.MOST…[Read more]

Hi, your 'losses' accumulate till you have to pay tax.So what's really happening is that you have no +ve Australian income & double taxation laws means you pay tax in the country you work. Please check this. Some countries may not have such agreements with Australia.Therefore, you'll be supporting the -ve gearing with income earned overseas.It can…[Read more]

Hi, for perspective. I bought my 1st house on a salary of just under $14000 pa gross. Super contributions, tax etc was about $3500 pa. I bought a $166200 house in the national capital.Stupid, I know now. But I survived.KY

Hi, wonderful. I wish I'd gone to school with a council planner!Well done.KY

Hi, I'm still perplexing over the issue of 'over/under supply'.I'm also rather sceptical of conclusions based on migration. Here in SA, the population grew about 3500 – now 10000 pa. Between 1997 – 2003, the housing starts actually were higher than population growth therefore technically, we were 'over supply'. However, the story on the street was…[Read more]

Hi, checking the rents is the best thing you can do. My shops are recommended $200/m2 but my rent is only $175/m2. The CPI increases will be applied definitely. I didn't put up rents for 4 years. You might find someone like that wanting to sell.My sister bought the shop next door & the rent was double of mine. Her tenant left 4 years on in a 6+6…[Read more]

Hi, I went to a school reunion & my friend's son just bought a 1 BR apt in Kensington for $430K. My niece bought a 2BR apt also somewhere near the uni 2 years ago & then rented it out & scooted off to UK to see the world.These stories for comparison. They're in your age group.Good luck,KY

Hi, Christies Beach has the better potential, both for capital gains & rental cause it has something that Hackam/Huntfield Hgts doesn't. The beach. A house for sale at Gulfview Rd was open last weekend. $285-295K. Might be worthwhile. Hallet Cove ditto. Has gone up a lot though.Another reason why Christies & Hallet Cove offer better IPs is…[Read more]