Forum Replies Created
There is no question about it if she intends to do as you set out she should take out a interest only loan with a 100% offset account.
This will give her flexibility as her circumstances change.
Not all lenders offer such a product and many dont offer a full 100% offset account or do not calculate the offset interest on a daily basis.
Your Mortgage Broker should be able to point you in the right direction as it is likely that additional IP purchases maybe in Trust name rather than her personal name.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
I hate to disagree with Kylies but do not believe that the sale will trigger a CGT issue.
The property is nominated as your PPOR and stamp duty will have been paid accordingly. If as a result of other circumstances the property is sold then no CGT will be payabe.
In saying this there is a cost associated with buying and selling so would suggest you stay put and access the equity.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
There are many lenders that do not charge excessive break costs or DEF on a variable rate loan.
It is difficult to give you an exact answer without knowing more details but happy to make some recommendations.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Hi again
Yes i am an advocate of interest only loan linked to a 100% offset account even on your PPOR.
Circumstances change as you move through life and you may find down the track that you wish to move to a new PPOR although would still rather retain your current property as an IP. If the principal has been repaid you are unable to refinance and claim the interest expense as a deduction.
The alternative is to consider selling the property to a Trust which triggers a stamp duty issue and can be costly.
Utilsing an interest only loan gives you flexibility for the future as well making the same interest saving as the interest oly charged on the net difference (Total loan – amount in your offset account).
It is also cleaner and means that if you do decide to purchase an IP or indeed rent the property out in the future and buy another PPOR the deductible interest is easily identiable.
Unfortunately in saying all of this many lenders do not allow you to structure your loan in such a manner and even more will not be too accomadating in lending to a newly formed HDT.
Thankfully thats where a good MB comes into play.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
I must admit before i started to repay additonal amounts into my home loan account I would liaise with a mortgage broker as it sounds like you have a traditional P & I style loan.
Personally I would not necessarily advocate these type of account for every client and think there are other considerations you need to make.
In essence you should try and maximise your borrowing for an investment property and purchase in an appropriate structure i.e Trust.
Remember in additional to the traditional rent you will receive from an IP there is also Depreciation and Building Write Off to be claimed.
A little time spent ensring your structure is right will pay dividends down the track.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
With the internet being what it is is and the ease of communication you don’t need a WA based Accountant / Mortgage Broker.
Have an excellent Accountant who i am happy to pass on the details if you care to PM / email me and like to think i know a little bit about broking.
I am licensed to act in WA and have many clients out that way.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Hi there
I must admit i am slightly confused as to your requirments.
When you mention that are looking to buy 2/3 units on a single block i asume that you are referring to a freehold torres title block of townhouses rather than Lots in Body Corporate.
I am also unsure as to whether you intend to construct them or wish to purchase them already built.
If you are looking at purchasing a block of land and building on it you need to ensure that it is zoned accordingly. The last Town Plan changed the Zonngs of many areas and incorporated the old RB3 & RB4 sites. An independant Town Planner will assist you here.
Then you need to make appication to BBC for a DA and subject to approval will need a BA to enable your Builder to provide you with a quotation to construct.
Just factor in the appropriate time frame as I have seen many new developers come unstuck as they have not realised the amount of time taken from start to finish.
Also ensure you factor in your GST & CGT (especially if this a one off) as tis will again eat into our profit margin.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Thanks Redleaves
Aother cheque in the mail. This is going to be an expensive year i can see.
Hear from you soon.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Our Qld wrap company built up a portfolio of 180 properties over a 7 year period so I assure you it is not impossible.
Whilst i accept that locating a Positively geared property is getting harder to find in the current climate bear in find that in addition to the rent you also need to consider the Building Allowance and Depreciate write offs that you are entitled to claim.
In addition, loan fees and set costs can be claimed dependant on the nature of the expense.
The non cash items make a signifcant difference in your monthly affordabilily.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Eastcoast
Must admit i prefer where possible to control the entire block.
This avoids the need for messy body corporates and means that the ultimate value can be higher rather than having individual units within the block.
Also you maximise your Depreciation and Building Write off claims which reduces your expenses.
Financing can be done relatively easy with the right lender so why not utilise the equity and increase your portfolio.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Hi Kris
Hate to say i havent any unanswered emails so can only assume it didnt come through.
Please feel free to resend it and i will come back to you immediately.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
I am sorry to hear about your husband and whilst i understand you dont wish to receive any sympathy i think the whole of the forum offers its support to both of you.
Unfortunately i think you need to consider your own future income position as i assume that one day you will merely have your salary income and the rents from the properties to lvie on.
Why not continue on purchasing property accessing your equity and structuring the loans correctly to ensure that you at least have the option of when you want to retire and on how much income you need.
Remember inflation over the years will eat away the purchasing power of your dollar.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Must admit with my wrap business we have always been advocates of + cash flow so maybe a little biased.
What is to stop you doing both. If the cash flow is + or at least not negative then the IP loan will cost you next to nothing and you can still reduce your non tax deductible debt.
Important thing to remember is to ensure that you structure the loans correctly to ensure maximum tax effectiveness as well as accessibility when it comes to your funds.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Hi Steve
Happy New Year to you both.
Cheques in the mail by the way.
You are right maybe it is the full moon or something but certainly noticed a lot of newbie virgin posters who tout for a bit of business, offer nothing in return then disappear to once the came from .
Oh well guess thats the nature of a forum.
Talk soon.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Hate to say the days of a min block size of 800 Sq M to subdivide have been and gone.
As has been mentioned each area is different and Paddington for example is under 300 sq M.
If you are unsure a Town Planner (remember BCC have outsourced this department now) will guide you accordingly.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
I can give you a personal reference on Chad and his organisation.
Chad is as knowledgable on the US market as anyone on the forum and has experience in both acquiring and renovating properties in both Texas and NY state.
He has assisted many clients when there was no financial gain and thinks solely for the well being of the investor and no his hip pocket.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Hi Ryan
Can I structure it in such a way as to have the CGT deducted at my wife’s tax rate or is it a 50/50 split ?? My wife earns significantly less that I do and enjoys a much lower tax rate.
Regretfully when buying the property in Qld you need to nominate how the holding will be on the Form 1 Transfer Document. I assume that you purchased the property as Joint Tenants so the gain will be split equally.
If however you purchasedx the property as Tenants in Common the split will be in accordance with the shareholding.
As you arew unable to negative gear land i beleive you would be better to consider constructing a property in the block and looking to either sell this or rent it out and utilise the equity.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Be happy to assist.
Think i might have one or two clients from the forum here who can give us a reference.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Which State is the property located in ?
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
Hi Eastcoast
Away from the decision making on whether to sell or not i thought I throw in a couple of points.
1) A collegue has already suggested we follow option 1, as a profit won’t be realised in only selling a couple and hence no capital gains tax payable.
Not sure where he gets this one from. When you purchase develop and Strata title a block of units the ATO proportion the initial purchase as well as the renovation costs and also the capital gain when it comes to selling the odd one or two units.
To explain further assume you purchase 6 x 2 bedroom units all identical for $300,000 the block ($50,000 each) and then spend $300,000 renovating the block giving a total base cost of each unit of $100,000.
You now decide to sell 2 units at $300,000.
You will be taxed accordingly $300,000 – $100,000 = $200,000.
It does not matter that you have spent more than this on the total renovation. In the case where the units are not identical i.e 3 x 2 bedroom and 3 x 1 bedroom units the capital base is taken by applying a floor area proportion and the same with the renovation costs.
2) If the units although 2nd hand are substanially renovated you may well find that this triggers a GST liability although in your opinion they maybe considered as not new.
Having renovated and strata title over 40 blocks of units here in Brisbane over the last 10 years we received a private ruling from the ATO on just this matter. The defination is the word “substantial renovation”.
These points may assist you in determining the outcome of your units but i for one would look to retain them and build up my assets by utilising the available equity.
Cheers
Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.Richard Taylor | Australia's leading private lender
