A friend gave me a REALLY OLD book a while ago on property. I can’t remember the exact name of it, but it’s no longer in print and has been one of the best books as I’ve read so far. it talked about wraps, buy and hold and renovating. Gave great tips, checklists and even gave examples of how contracts are suggested to be drawn out.

I’ll try dig it out if anyone is interested in the title and author.

[|)]Zzzzz…

[] Wha? Huh? Eveybody done?

Oh, well, there’s always next time.[8D]

Yes, Kelly is right. I made the assumption that you are renting and own the two IP’s with no PPOR status in either.

Please clarify the PPOR situation:
Have you lived in one or both IPs?
Did you live in either prior to it been used to produce rental income?
Provide a time line of your PPOR/occupancy status and income producing status.

Assuming no PPOR benefits, there are two outcomes:

Owned the property 365 days or less, 100% CGT. Add the gain to your income for total income. On $30,000 you pay $5,622 tax+medicare. On $150,000 you pay $59,497, or $51,240 on top of your normal tax paid. So you net gain is $120,000 – $51,240 = $68,760 (43% flat rate).

Owned the property 366 days or more, 50% CGT. Add half the gain to your income for total income. On $30,000 you pay $5,622 tax+medicare. On $90,000 you pay $30,397, or $24,775 on top of your normal tax paid. So you net gain is $120,000 – $24,775 = $95,225 (21% flat rate).

With PPOR exemptions or pro-rata concessions this can be reduced dramatically or to nil.

With no PPOR status, I’d suggest waiting, if possible, until the 366+ days are up, if not already. It will make a $26,465 difference just doing that.

Also, make sure your gain is calculated correctly, and is not just the sale price minus the pruchase price. You will be throwing away money.

Michael

Thomas,

Equity, equity, equity, plus the usage of the positive cashflow generation.

Regards, Phil

Hi Aussierogue,

Glad to see someone is proactive with a budget. I aspire to your efforts.

For what it’s worth, I have heard the following advice from various and unrelated avenues.

PAY YOURSELF FIRST

Yep, no matter your income, pay yourself first. Live off the rest. And yes I have read “The Richest Man in Babylon” .. it quotes same. It’s simple maths but it makes so much sense, as our mothers tried to tell us as youngsters.

I used to dismiss my own mother’s quote “ten one cent pieces makes ten cents”. Seemed trivial as a kid, but makes lots more sense now.

I know it’s basic stuff, but think of it in terms of compounding interest.

All the best, Phil

I dont have a budget

YET!!

but when I learn to work one out I will have one..because I NEED one. Desperately….

[xx(][xx(][xx(]

~ Heaven doesnt want me and Hell is afraid I will take over! ~ :þ

I wouldn’t say it’s impossible and there are several ways of raising capital. One is using OPM and by finding an investor to financially back wrap deals, another is finding the properties and flipping them on to other investors.

If he can do it, it’s all the greater the victory.

Best of luck insider

Arty’s arty arsey []