We use a trust with a corporate trustee for our business and separate trusts with myself and my husband as trustees for our properties. If you are investing in Vic please be aware that if your trust has gross income of 75,000 or more the trustee will need to be registered for GST. This is why we keep 2 – 3 properties per trust. We intend to keep the properties long term so we have allowed for rental increases not exceeding the threshold ( hopefully over more than a decade).
You should always have your structures set up prior to purchase – if you need to change the entity after contracts have been exchanged, you may trigger a second lot of stamp duty. If you are in the process of setting up your structure when you find a suitable property, you can write on the contract of sale purchaser :  (your name) and or nominee. Make sure your solicitor knows what's happening though.

Hi,
If  you happen to come to Bendigo, our accountant Mark Hernan is fantastic. He will set up your structures in the most cost effective way, suitable to your circumstances.
 ex. We were going to do what Chan & Naylor said and have separate trusts for each property with a corporate trustee in each, at a cost of thousands of dollars in set up fees and also ongoing accounting fees and ASIC fees.
When I spoke to Mark ( our accountant) he looked at what we were doing and said that we could be the trustees – no need to set up separate companies for each!! Also provided that the gross yearly income for each trust was under 75K we can have more than one property in each trust without having to register for GST..
We've been using his discretionary trust for 2 years and have had no worries. Hope you find someone who can help you too.
Good Luck.

I have robert's books:
Rich Dad Poor Dad, CASHFLOW QUADRANT,  Rich Dad's Guide to investing,  Rich Dad's Prophecy, Retire Young Retire rich,  Who Took My Money?,  Increase Your Financial IQ, Rich Dad's Conspiracy Of Th Rich, and Donald Trump & Robert Kiyosaki Why We Want Yu To Be Rich.

I have found them to be very informative and very easy to read, the type of books you don't want to put down.  They are repetative though. A lot of them show his quadrant – where people make their money – the employee and self employed in one side of the quadrant and the big business and investor on the other side. What he says is correct though, you make more if you own the big business and invest as opposed to being an employee of self employed.

Hi,
If I was in your situation I'd consider opening a self managed super fund and rolling over all of your superanuation into it. You can purchase properties in a self managed super fud, either outright – if you have enough cash, or by setting up a unit trust and taking out a loan with a bank. The benefit to doing this, considering your age, would be that all profits in your super are currently taxed at 15% as apposed to your marginal tax rate which may be 30% – 46.5% depending on your income.
At 65 you can then sell and I think the capital gains tax in a super fund are also only 15% and then draw down the proceeds as an income stream tax free. Or you can collect the rent as an income stream – tax free. The beauty of this strategy is that the tenant and your super fund pay off the loan.
The down side is, you can never move into the property, and any profits cannot be accessed until retirement, but it looks like you are doing this for your retirement so that should not be an issue. Have a chat to your accountant to see if this is an option for you.
As for your investing strategy, I agree with JACM. We don't invest in cities due to the price tag and negative gearing. We invest in country areas with a higher yield and we still get good capital growth.
I like to invest in old properties at a cheaper price and fix them up. Some people do sub divisions. Have a think about what can be done with property and find a strategy that appeals to you. (One bedders with rental guarantees may not be good – what happens when the guarantee runs out?)
If you need to get a loan, banks like it to be 80% LVR, although they will go as high as 90% if you pay lender's mortgage insurance – which protects the bank, not you. We like to keep our LVR below 80% the higher the loan, the more interest you pay.
A good way to get an idea of what a property might rent for is to have a look on realestate.com.au type in the suburb in the rent section and browse. Then you can also see what properties are selling for in the same suburb. It's a good place to start your research. Hope this helps.

Banks will always give you a conservative valuation if you are wishing to re-finance. They have to do this, I guess it's so that the bank will get their money back if you can't make the payments and they have to sell the property. If they give a low valuation then the bank isn't exposed to much risk. They look at where the property is in relation to transport and services as well as the condition of the property and comparative sales data.
Even if the valuation does come in low, if you were to sell you'd probably get more for the property than what the valuation says.
We've noticed that all of our valuations have come in aprox $20,000 more than the value on our rates notices. I don't know if this is coincidence or something to do with the way it's done?
The only way to get a true valuation is to sell. ( I don't recommend this tho)

Mine was similar, I wasn't going to go into a lot of detail but this will give an indication of why I was upset that RACV would not cover anything. ( Except the rent)
The house was renovated prior to the tenant moving in.
Gouges out of the boards, and the boards were scratched right through the house.  The paint was stained yellow and there were dirty marks all over walls and sugar soap would not remove them. Poo all up the walls, cardboard covering shit and vomit which was dry on the floorboards. Smashed kitchen window. 3 skips of old stinky clothing and other garbage including syringes.  10 mattresses.  Kitchen and bathroom green and black from the filth and mould. The children pulled down the fence and nailed the planks high up in a tree in the back yard. The curtains were ruined, but because they were not ripped my insurance did not cover them. There were no light globes in the sockets when I finally got posession back through a VCAT Possession order. The police had to attend to evict. It took over 3 months to get her out. The first notice was served in April and she was out in September.
The smell was so bad in the house that I dry reached every time I went inside. It took me 3 months to clean up her mess including  replacing  the fence and window and re- paint the whole house, and do the other repairs. ( A little bit each night after work)
The woman was a single mum with 5 children. On her application she had 2.
Where is your other thread? I'd like more info on how we protect ourselves from these people as I could not pass this off as "fair wear and tear"
Thanks.

I can relate to what you're saying. So many times people say to me that what I'm doing is risky, or  that's not going to work, or " don't do that you'll end up bankrupt" etc….
But at the end of the day, it's my life,  investing is exciting and I love it and I'm gonna keep doing it!!
I sound like a 16 year old rebelling against my parents… hmmmmm…
Keep your chin up and smile because it is only their jealousy and their own insecurities showing when they put us down. It is not a reflection of our capabilities. 

If your loans are cross col. and you want to refinance to draw out any equity, the bank will need to do a valuation on all of the properties securing the loan. They charge you for all of the valuations.
If you have separate loans you can choose which one you want to refinance, only paying for one valuation.

There are good and bad points to consider when using a trust and when the property is held in your name.
I. Your land tax threshold is lower when using a trust. In Victoria the landtax threshould is only $25,000 in a trust but it is $275,000 when in your own name. This will vary from state to state.
2. When using a trust there is no capital gains tax exemption, however you do get a 50% deduction if the property is held for more than 1 year. A property held in your name as your PPOR is not liable for CGT. You can rent the house out for up to 6 years and still claim the PPOR CGT exemption.
3. When using a trust you can split the income between the beneficiarys, to lower the tax paid. You can also split the CGT. If the property is held in your name you cannot do this.
4. If you purchase the property in your name you will be entitled to the FHOG.

I was in your position 4 1/2 years ago. I bought my first property in my name and got the grant and I still own that property. My husband and I now own 5 properties. One in his name, one in mine and 3 in trusts.

It is good that you are thinking about your structures now. If I had to do it again I'd do it exactly the same way. Take advantage of the FHOG while it's available. And then go on to invest.
If you intend to only stay in the house for 6 months I'd be inclined to get an interest only loan with redraw or a LOC. That way when you come to rent it out your loan is already set up for investment.  You can still make additional payments to bring down the interest and to help to get some equity.
Find yourself a good mortgage broker. They have access to all of the banks and can find you the best deal. They will work with you to find solutions for you. Their services should be free as the banks pay their commissions.
As for your second purchase, don't stress too much about it at this stage. Get our there and get number one done, then worry about the second one.