Forum Replies Created
Hi Terry – yes I had thought of renting it out but need some more info on CGT exemption for PPOR. If I were to rent it out, claim tax benefits, then move back in within 6 years would I then be required to pay back any tax benefits?
My property is in Mawson Lakes SA, a Delfin land development. It has fantastic amenities (schools, shopping centre, University of SA campus etc) and is 12km north from the city. The development is smack bang in the middle of the Port expressway meeting with the proposed northern expressway, and with all of the projects planned for the northern suburbs there could be great opportunities for growth. Our home is in what has been developed as a more "elite" section called the Bridges. Our home is conservatively valued at $520,000, with homes on the next street selling for up to $1M. I'd be keen to hear any ones views on the growth on these sorts of land developments – or Mawson Lakes in particular.
Thanks Lisa and Terry.
In response to why to sell the PPOR – I am still struggling with it to be honest. The reason to sell is purely financial – We could keep the PPOR and live in it – and borrow just enough money to buy one IP and possibly have the the cash flow to fund it weekly, but then where to? I don't want to stop at just one IP if there is the possibility of buying many more! The other factor is a lifestyle one, I expect to start a family in a couple of years and we won't be able to afford to pay the PPOR, let alone the additional IP on one wage. Renting it out is an option, however I'm after some research I'm not convinced the area we live in is great for rental properties.
With the current market conditions, I'm also skeptical if selling the house now would be a smart move?
Ahh the decisions! If anyone has been in the same boat I would love to hear about it.
Hi All,
1. Do you use an accountant and / or financial advisor that specialise in property investing? Or should all of them be knowledgable in this area?
I would really appreciate some advice on this one, thanks all.
Thanks all for your replies, much appreciated.
In regards to holding the PPOR and renting it out to avoid selling costs – I agree that this would be a better option. But we have a mortgage of $400K (repayments of $2800 month, IO would be $2500 month) so if we were to rent it out for a max of around around $400 per week we would be out of pocket ourselves of at least $1000 a month on just one property. If we then paid rent ourselves of $1500 a month we would not have the affordability to buy much more than one other IP, even with the equity of around $130K.
My rationale for selling and taking the cash is being able to grow our portfolio quicker. My other consideration is the fact that my partner and I would like to have kids in a couple of years, leaving us without a $70,000 wage each year that I don't work. Having a couple of positive or at least neutral geared properties would make things easier in this situation.P.S – In case this info makes any difference – I am 28 years old, and my partner and I earn combined around $140,000 a year. Taking out rent of around $350 a week, we can service quite a bit of debt at this point in our lives.
Thanks!
Thanks for your replies everybody.
Just to clarify we will be moving in to the property this month and planned to stay in the property for at least one year before selling it (if we were to sell. My main concern as someone pointed out is the associated cost of selling the place.
My concern with staying in the PPOR and using the equity is that we will most likely have to start off with a negatively geared investment and will not have much extra cash to fund this.
