get a conveyancing solicitor

Lifexperience

I had read a previous thread that claimed that if you did joint ventures with percentage interests at 50/50 then 51/49 then 52/48 then you somehow managed to dodge the higher land tax rates.

I went to the vic SRO website and checked out the section on calculating land tax for joint ventures. And got bogged down in their Algebra.

I could not work out if you have to pay land tax for the whole property each OR pay for your portion and add that to your total land tax bill OR get the low rate of land tax calculated separately for each new joint venture property at a different % interest??????????

Who is smart enough to explain this….. (the challenge has been set!)

Lifexperience

That is the funniest

Thanks Calvin

Lifexperience

…unless you can argue that it is a repair and not a ATO defined Home Improvement. Ie; replacing a faulty part of the property.

I’m pretty sure A new decking would be an improvement.

Lifexperience

This is a very interesting thread.

There have been many references to examples in the past that show good and bad results from both property and shares.

Both have potentially good returns and also possible downside risks.

Your risk assessment will determine what you can risk. If you are young……..you can take a chance that could well send you broke but also possibly land you a great winfall.
If you are close to retirement and have family that are dependant on your money to put food on the table, then you would not take any big chances.

I think a lot of the heat in this thread arises as everyone wants to put their money into the best investment. A lot of the money to be invested may be the result of hard work, sweat, tears and sacrifice. The reason that you invest is to make more money to provide…a better life for yourself and those close to you.

So the fun question that is then presented to us all….is:

What should I invest in?

The answer will of course vary for every individual circumstance and there are many differing opinions out there.

I am no investing guru, but I would like to put in my 2 cents worth.

1. I think you first need to decide WHY you are investing?
………………..I want to live life to the fullest.

2. Then I think you need to quantify what results you expect? ….for example i want enough passive income to replace my current working wages.

3. Decide what your risk profile is………….for example “i am a young single go-getter that is willing to take a moderate to high level of risk and am prepared to start from scratch all over again if I lose the lot”

4. Then formulate a plan that will reach this goal…………for example buy 20 cashflow positive investments in 2 years. …or…. buy 5 negatively geared properties and sell them when they have doubled in value and put cash into fixed interest term deposits.

5. Learn as much as you possibly can about a type of investment you think may fit your plan………….shares, property, multi level marketing, businesses,

6. Then find investments that may fit your plan and evaluate them.

The big key here and what I think this thread is all about is ……….How do you evaluate if a particular investment is the best?

I do not think that you can base this decision purely on past results like 30% return for the last year but have to consider a large number of diligence issues.

1. One of them is how this particular class has performed in the past? This is but a small part of evaluating an investment.

2. Is the market demand likely to increase/decrease?

3. What are all the potential risks that could affect value and/or cashflow. No tenants, housefires, company go bust or directors exposed for fraud,

4. How to mitigate these risks

5. Long term integrity? Building structural construction, is there a poor maintenance program in a manufacturing company? Are oil/coal reserves running out

6. Future possible legislation/tax changes that may hike up costs? like increased land taxes….. which probably affects shares just as much as companies have to pay more for the land they own. …….are tighter restriction on the safety testing of dolls for a toy company due for instance?

6. Has technology superseded the companies main product?

YADA, YADA , YADA on and on and on …..there are potentially hundreds of things.

…………Any decision to purchase an investment by looking at only one single part of an investment like “For the last few years this managed fund has made 30% return or whatever IS GAMBLING!!!!!![devil]

If you consider yourself an investor FIND OUT EVERY POSSIBLE DUE DILIGENCE ITEM AND RESEARCH IT!!!!!

Lifexperience

Why not cut somebody in for half of the property (or whatever percentage) and share the cashflow loss for now.

Set it up like a wrap with a property solicitor drawn up contracts and have a suitable partner place a caveat over title ………. then just split All costs to whatever percentage……………………..

………….friends, family, associates may jump at the opportunity to have a piece of seachange property…

Good Luck :0)

Lifexperience

Foundation,
You are wrong!

YOU SAID When prices are going up, the wrapper keeps any capital gain if a wrappee defaults.

Not so under the law. If a wrappee defaults, the wrappee is still entitled to any equity earned above the contracted price.

YOU SAID If prices fall and the wrappee walks, the capital loss is handed back to the wrapper.

The wrapper owns the house before the contract is made and would still own it if the wrappee fails to complete the sale. What capital loss are you talking about??????????…………..
…….if you don’t complete a sale, there is no loss. You would be no worse off than if you were plain renting or even living in property.

Your post shows complete ignorance about wraps and general property and YOU even quoted ACA as a reliable source of fair information………what the…?

If you are going to pick flaws in something, get your facts straight.

P.S. I have no connection to We Buy Houses at all.

Lifexperience

Hi woodsman. I am in the process of considering purchasing an OTP property and hope my recent experience may shed some light on the flexibility of lenders and OTP companies that may help you situation.

The first step was to get finance evaluated using equity in existing properties. The OTP company’s financier wanted to refinance my existing loans (85% LVR) to 90% LVR of the new valuations ( to be done next wednesday. )

These properties were purchased last March on 3 year Fixed Interest Loans.

I rang my existing Lender at INGBank and spoke to a problem solutions guy who pointed out that I would have to pay break costs (about $3000 for discharge fees, solicitors fees, break costs etc.) And also pay $5000 again for LMI if I refinanced. …………….He was immediately able to offer me the same deal with ING but without the above costs….. and he would waive the usual admin charges too.

I rang the OTP company back and explained that I couldn’t see any reason to pay $8000 on a refinance that I didn’t have to. I apologised that this may have put the finance guy out as he had done a lot of work for me but I was actually a bit peeved that he had fast talked me into something so quickly. In the process telling me that:

1. “the break costs would be no more than $1000” …..IT was more than $3000!!

2. “I would have to virtually pay full LMI with my existing bank anyway to increase LVR as the banks only insure the percentage above 80% whereby private lenders insure all of the loan” I checked, this was incorrect as I would only have to pay the difference on 90% to 85% LVR.

3. “It doesn’t matter because it is rolled into the loan anyway”………….hello. I still gotta pay it back – with INTEREST over 25 years buddy!

So now I have my existing Bank offering me a great deal on a new LVR of 90% in less than 12 months since purchase (equity I didn’t think I could access as they were fixed rate loans) and the OTP company have just come back to me offering $6000 cash back to pay for the exit costs and new LMI if I exit my current loans.

I had already committed to getting Vals done with the OTP companies financier and they told me that these can’t be cancelled as holding deposits have already been paid to valuer. So i will have to get these done anyways.

I will also have to get another valuation done by my existing bank if I stick with them. What the valuations come to may well determine which way I swing.

It hurts a bit paying for two valuations on 3 properties but maybe the leverage I have on two lenders in a direct bid for my money will pay off.

Lifexperience

I too have found a lack of enthusiasm from my girlfriend in the investing department……..sigh.

I suppose all partners have their good and bad points. I am very lucky my girlfriend is great in the love and caring department.

If she was too much like me……….err…….that would be creepy.

Proofs in the pudding guys. (just think of that huge “I told you so” you have got in ya back pocket for later on………………………….mmmmmm, gloating rights!!)

Lifexperience

Find someone with cashflow and no equity. High wage earning young people for example.

easy

Lifexperience