Hi Fizman,

You’ve been given some great options here. But it really comes down to you. Digest the information, decide which path to take, make a plan and stick to it.

Once you’ve managed to sort this out you’ll be in a much stronger position for future investments.

Only you can make it work.

Rod.

crashy,

I don’t understand your figures, it appears you’ve given both the +ve and -ve properties the same growth figure. Doesn’t this defeat the purpose of the exercise?

Rod.

Lies, Damned Lies and Statistics.

I also lived in Melbourne at this time (still do).
We bought our first house in 1987. There’s no way there was an across the board drop of 20-30% – some isolated sectors maybe.

There was however a significant slowing of the market and a retreat from the peaks. This retreat was more in the order of 10 to 15%.

Rod.

I’ll have a go at this.

I would expect this to be classed as a purchasing cost which is added to the capital cost base and therefore not deductable. If you paid for the buying agent with borrowed funds the interest on the borrowings would be deductable though.

Rod.

You’re best to talk to an accountant (I’m not one). But my impression is that as you are refinancing “personal” funds, not actually purchasing a new asset then it’s still not deductable.

One of the creative mortgage brokers on this forum may know a way around it though.

Rod.

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Can I tell the bank that I will be renting out my PPOR (even though I do not intend to rent out) and living in IP1 ?

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doesn’t sound ethical to me.

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Will the bank accept that ?

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As a bank shareholder I hope not.

Rod.

Well done Aussie,

but look at westan go! he seems to have got from 100 to 180 posts in about 3 days.

Rod

Mini said:

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one of his love seminars

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Sounds like that would have been an interesting seminar[]

Rod.

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Eg. Buy a place for $190K sell 5 yrs later for $240K = CG of $50K. However, if you’re claiming $7K in depreciation each year you’ll be taxed CG of $50K PLUS (5yrs x $7K) = $85K.
The difference after the 50% discount is applied for not claiming is a tax of $12,500 compared to a tax of $21,250. At the end of the day $50K-$12,500(=$37,500) appears so much nicer than $50K-$21,250(=$28,750).

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Your figures are flawed, you’ve forgotten about the 5yrs x 7K you’ve already claimed. So you’ve actually received $50K-$21250+(0.5x5x$7K) = $46250.

This is because the depreciation claim is assessed at your marginal rate, whereas the CGT is assessed after a 50% discount.

Also I believe that it’s only the building allowance claim which is deducted from your capital base, not the fixtures & fittings claim.

Check with your accountant. (I’m not one).

Of course it’s also not an issue if you don’t sell.

Rod.

Have a look at the Web Links tab on this site and also try a search on this forum for useful links.

Rod.