Forum Replies Created
Good luck with the offer ManicSquash, and don’t be disheartened if it is rejected; although it might mean starting again, you may well be surprised to find that it all worked out for the best and the next place you find supersedes the last!!!
Jo
Gee I only nominated one movie as the thread question asked “favourite movie” (singular) and it was hard going, racking my brain to pick just ONE fav….okay, so now I can add to my list??? [specool]
Shawshank Redemption (nominated in previous post)
Grumpy old Men
Grumpy old Men II
The Odd Couple (original with Jack and Walter)
Top Gun (good drool value here girls)
The Thomas Crown Affair (ditto above)
The Color Purple
The Seventh Sign
War of the Worlds
Scent of a Woman
The Insider
Night at the Roxbury
History of the World Part I(there’s so many, I better stop there)!!!
Sorry Westan, maybe I should have included one of these [laugh4] or these [lmao]
My comment was not aimed as a disciplinary retort. I am sure that there is nothing but respect between you all.
Jo
Guys, guys, please!!!
Look, does it really matter anyway??? Whatever works for you, then go forth and multiply!!!
As for me, property has served me very well. To name but one example, I bought one IP in 1984 for $175K and sold it in 1994 for $925K….do the math!!! Shares maybe able to do likewise (I don’t doubt it) but they can (and have) worked the reverse too!!!
I believe the trick with high risk shares is quite simple; if you can write-off the 10K you’re going to trade (and not care if you win or lose) then fine, knock yourself out!!! BUT if it means having to borrow it to start with….I’d think long and hard about it!!! A fool and his/her money can soon part ways very quickly if due diligence is not exercised, no matter what method of transport (vehicle) they boarded!!!
Jo
Yes you’re quite right there Rugbyfan, and I guess in here I felt secure in the notion that it would not be taken out of context (as I know you didn’t) [glum2]…and yes it is sad, that such frivolity is (in some instances) no longer able to be viewed with the same innocence these days.
Jo
Nope….2 possibilities, premonition or he’s planted a bomb!!!![lmao]
Sorry Yorks, just taken the “mickey” couldn’t resist!!! [tongue]
[drummer]HAPPY (Belated) BIRTHDAY
SHAUNWALKER [drummer]
Sorry can’t oblige with your request, but hope you get/got some nice pressies anyway!!!Hi Simon,
Yes I understand what you’re saying, but what I’m asking is; let’s assume that you DON’T use it for a holiday.
That is, you have a LOC for 100K which you max out on the purchase of an IP for the same amount. You now have 0 funds available to you. Then you drop 10K into the LOC and reduce your interest and leaving you 90K in debt. Of course if you take the 10 back out and go spending on a holiday or whatever it is non-deductible, but say you redraw the 10K to use as a deposit on yet another IP, then I would assume this is not “personal”.
I think we’ve gotten our wires slightly crossed. I read Pepper’s comment and saw that what she was saying was “yes but if you use money to buy IP and you have documented proof of “investment” expenditure, how can ATO class it as “personal” expenditure??? Which is what lead me to my question re your response to Pepper’s comment.
And somewhere along the way it got fuddled up!!! [blush2]
Jo
Simon
I just read your post above and hence edited mine here accordingly. I think this satisfies my curiousity; many thanks for your patience Simon.Hi Squash,
Firstly, REGARDLESS of whether you have pre or actual bank approval (the agent and vendor don’t know this) and as such you can (and legally I have always been told you should) include the clause “subject to finance” I do it all the time and always purchase for cash (hence don’t even need it). The reason to include it, is because it is a “legal” out, and all you have to say is “the bank has declined the finance” (and if you word up the bank they will back you on your decision to pull out and assist with your little white lie!!!!
Secondly, if you haven’t done your due diligence, WALK AWAY NOW…..it’s not like you’re running down to the supermarket, and forgot to get X from your list, this is a property, and as such you can’t just run down and add bits!!! Apart from anything else, it is someone else’s livelihood, and if you’re not READY to buy it, then leave it to someone who is!!!!
Jo
Hi Squash,
Welcome to the forum!!!
Point one, re your conditional statement, yes it is too broad – how long is this due diligence meant to take??? Either way, I don’t think you can include it, may you may wish to get confirmtion of this from a legal professional. Do bear in mind that you have (depending on which state you are in) from 3-5 days “cooling off” period after your offer has been accepted to withdraw it.
As for the offer, the vendor can ask for whatever he/she wants, and I have seen this happen from time to time, but whether they get it is another matter. Offer what you feel it is worth, and if you’ve done your homework, you should have a good idea of this.
Good luck with it, and please do keep us posted on your progress.
Jo
Originally posted by MortgageHunter:Taking funds from a loan or from a LOC is deemed as a new loan – the purpose of this loan then determines the deuctibility.
So if you put $10 000 into your LOC then take it out again a month later for personal reasons it is non-deductible.
Excuse my ignorance here Simon, but I was curious when I read your post….surely if what Pepper is saying that is, you take money out of the LOC to purchase say for example a 200K property + 10K for costs hence redraw 210K that is/should be proof of (an investment) purchase??? At the same time, I understand what you’re saying that if you parked 10K into the LOC and then redraw it for personal reasons it is classified as non-deductible, but IMO buying the IP is not “personal” and should be deductible??? Please correct me if I am mistaken here.[blink]
Although I don’t have a LOC myself, I would imagine many people probably are not adequately informed on these differentiations; that in fact there are some “grey” areas which people are unaware of. Hence this thread may help to clarify and hopefully eliminate some of the confusion.
Cheers,
Jo
Oh me too, me too!!!!
I’m a real 80’s gal; the disco era was my favourite!!!
When and what time?? I’ll get the hot pants out of moth balls!!! [laugh4][laugh4][laugh4]
Jo
Hi Wallflower,
I suggested Melton in my first post for the very same reason as you; because it is still relatively cheap!!! There are some good buying bargains yet to be snapped up, with new estates springing up and lots of young families buying into it. It is only 37km from Melbourne CBD, and is very accessible via the Western Ring Road which helps cut down a lot of travelling time to and from the city. Although it is one of those slower growing western suburbs, I think you’ll find that stigma you are referring is gradually diminishing and (albeit slow) is indeed progressing nicely.
There are many suburbs that still have “a stigma” attached to them, but it doesn’t seem to deter buyers all that much. Once upon a time Ashburton was prodominantly all housing commission, with a very pronnounced “stigma” but today entry prices for a 2 bedder in Asburton are in the high 300’s!!! Go figure…..
Melton is definitely worth a look; it does have some industrial pockets but this provides work for many of its residents. Rental returns are (in some sections) probably higher than many of its surrounding suburbs, including those closer into the CBD.
Finally Aafreen, in reference to your pop size question…I’m afraid I can’t really comment on the size of population you should aim for rurally speaking, but I would guesstimate that at least 15-20,000 is a good figure, but more importantly that its infrastructure is well established or at least in the planning pipeline!!! (Check with councils)
Cheers,
Jo
Oh go on Leigh, be a sport, chuck in the steak knives pleazzzzzzzzzzzzz???!!!! [thumbsupanim]
Bad Boy Acey; play nice!!! There’s amateurs and then there’s amateurs; and I don’t class myself as either!!!
Hi Rob,
Unfortunately you will have to pay CGT (at the 50% rate) regardless of your yearly income or the fact that you have debts tied up in other property. However, if you owed money on the unit, interest paid also needs to be deducted to reduce the CGT bill.
Yack’s calculations are basically correct: 110-40 (Sale price – cost base) = 70, halved will be 35 that will take your income for the year to $61K. I took the liberty of using the figures you have provided and entered them into the calculator below:
http://www.cch.com.au/cgi-bin/cgt00isapi.dll/ and found that your CGT bill will be approx $27,955 (gross estimate).
NOTE: The above figure does not take into consideration deductions which may be added to further reduce the CGT i.e. RE agent’s commission, advertising costs (for sale) and any other expenses incurred when you first purchased unit (i.e. stamp duty, legal fees) or expenses during ownership such as capital improvements made, and of course any tax which you paid through your salary earnings (PAYE).
Have a look at the calculator, it’s a good quick overview of what you could expect to pay, but remember it should only be used as a GUIDE. As Yack suggested SEE PROFESSONIAL ADVICE from your accountant or tax agent.
Cheers,
Jo
Yep Rugbyfan, can’t argue with that!!!
But hey, it’s just that FIRST hurdle; it gets easier after that!!! [medieval]
Tell me about it !!!!!
Seriously, I know what you mean Rugbyfan, and you’re absolutely right. I was a nervous wreck [wacko]watching the changes from day to day, [rolleyes4][rolleyes5] and I remember thinking, this cannot be good for my health!!! So I did what any smart investor of shares would NEVER dream of doing, I panicked and cashed in (at a loss). [glum2]
Friends once asked hubby and I what the most heart-stopping adrenlin pumping spontaneous thing we’ve ever done. My “toy boy” gives that sweet cheshire cat smile of his and announces “bungee jumping” and when they all turn and look at me, I don’t hesitate for a second “I bought shares”!!![lmao]
Jo
Hi swinys,
Welcome to the forum and to Oz!!!
The first name that sprung to mind was one of the people in here, Stuart Wemyss.
I already have my own (long term) accountant, but if I ever decide to switch, I would definitely consider turning to Stu; he seems very down-to-earth and knows his stuff. He writes for API (Australian Property Investor) magazine, and has won national awards of excellence!!! Can’t do better than that now can you??? [winking][winking]
Cheers,
Jo
P.S. Stu, could you please remember to mark the cheque “not negotiable” thanks!!! [lmao]
Hi Ace,
As I have mentioned to you in our chats, I am a “bricks and mortar” girl, brought up to think of nothing else for as long as I can remember. Heck, I guess I’m living proof that maybe there is some truth in the saying “you can’t teach an old dog new tricks”!!!
However, I am not fool enough to think that property is the ONLY way to make money (just my way). I have the greatest admiration and respect for people such as yourself who are far more adventerous than I could ever dream of being!!! Although I have dabbled in shares, unfortunately it is not for me, as I think the daily up/down yo-yo roller coaster ride makes me dizzy to say the least!!! And between you and me, I like to be able to touch (my property) gate post!!!
Seriously, property has and will always be a “passion” for me and as such it is not just about making money (although that is a major mega bonus); it is about (financial) freedom, and as I have already achieved this level of comfort why be greedy and possibly risk it all??? Honestly, I just don’t see the need.
It may sound like the voice of ignorance to some investors who believe in diversification, and that’s fine, but for me the “if it ain’t broke, don’t fix it” philosophy works well.
Thanks for asking; makes for a very thought-provoking thread; trust you Ace !!!
Cheers,
Jo
Hi sedraash,
Firstly welcome!!!
I know I’ll probably cop some flack for this, but hey, let’s live dangerously for a minute..!!![blink]
I have never read Steve’s or anyone else’s “how to make money” type book, although I have attended a couple of seminars in my time, mainly out of curiousity. Some were good, but most were a waste of time (and money), and I would have gained more from a motivational tape/DVD (not to mention cheaper)!!! However, I am neither for or against attending seminars; I think it’s up to the individual; if they feel that they want to learn and have an open-mind (as well as open-wallet/purse) then I say “go for it”!!!
Me personally, experience has been my greatest teacher, both trial and error my friend and foe. This combined with hours, days, weeks and months of research has led me to my success. And I’m sure that if you read the books, attend the seminars (provided you are selective in your choices of course; there are some real sharks out there; thankfully Steve is not one of them) I’m sure you’ll do equally as well.
Cheers,
Jo
