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Viewing 20 posts - 1 through 20 (of 20 total)
  • Profile photo of TalismansTalismans
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    @talismans
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    Post Count: 23
    June 28, 2011 - 5:22 pm

    I'm a bit crazy actually and my risk acceptance level is high.

    (Assume that I have already got a PPOR somewhere in the 6 years CGT exemption period)

    If I have 150k for a house deposit, I would get a positive cash flow property in an established mining town which has potential capital growth such as Port Hedland, Karratha , Dysart or Moranbah. Then I will use this $25k-$35k cash flow to fund the rents.

    But once you think about the all the benefits of owning a house (i.e. includes all the non-monetary benefits), then buying a house isn't an investment decision anymore. Hence, it can not be justified by returns or potential capital gain etc. You buy it simply because you like it and you want it. And that's what money is for isn't it?

    Profile photo of TalismansTalismans
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    @talismans
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    June 26, 2011 - 9:15 am

    Yeah this is very smiliar to south hedland (WA) before the boom in 2009

    Profile photo of TalismansTalismans
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    @talismans
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    June 26, 2011 - 9:11 am

    Hi All,

    After you move out of the PPOR and want to rent out the property, do you still need to direct all mails to the address to use the 6 years CGT exemption rule?

    Cheers
    Talismans

    Profile photo of TalismansTalismans
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    @talismans
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    June 25, 2011 - 3:49 pm
    coalstar wrote:
    the point is if your getting 1400pw in rent surely you cant be too pandatic about the bloody lawn, just buy the tenant a mower and get them to cut; no need to be completely greedy

    Agree =) Thanks guys!

    Do you guys notice there's been an increase of rents in dysart and moranbah as well?

    A 3×1 has recently jumped from $800-$900 pw to $1000-$1300 pw and a 4×2 from $1000-$1200 pw to $1600-$1800 pw.

    I reckon another boom isn't far behind (in the next couple of years, given the strong rental return is sustainable). When most of these houses are renewed with new rental contracts, the house prices will also rise, until they reach about 10 times of the yearly rental return.

    Any thoughts?

    This happened 3 years ago, here's one sold in Jul 2008 rented for $560pw =)

    http://www.realestate.com.au/property-house-qld-moranbah-104767405

    Profile photo of TalismansTalismans
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    @talismans
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    June 22, 2011 - 2:22 pm

    Hi Deb,

    Here's a solution, however it may not be suitable for your risk acceptance level.

    With 180k cash, you could get a positive investment property in either South Hedland (WA), Karratha (WA), Dysart (QLD), Moranabh (QLD). As the rental return in these areas are about 10-14%, it should generate enough cash flow to balance your other property. Depends on the value of the property, you could be getting $1-3k per month which could be used to offset your negatively geared property. In addition, since these properties are positvely geared, as long as you have enough deposit, obtaining finance from the bank shouldn't be a problem (as rental will be counted as income)

    This could give you more times to hold onto your negatively geared property without selling it in an discount (unless you have to sell it asap because the property has fundatmentally lost its value)

    However this could be a risky move.

    I'm living in a mining town, hence my risk acceptance level is higher.

    Apart from doing extensive researches, you will also need to look at your long term goals and risk acceptance level before making such investment decision.

    Cheers
    Talismans

    Profile photo of TalismansTalismans
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    June 22, 2011 - 2:03 pm

    Dear all,

    I have just purcahsed a property in Moranbah and currently looking for PMs in the area. Instead of making a new post, I will keep all the CQ stuffs in this post =D

    I have the follow questions:

    1. Since the rental return has increased rapidly (and it is still increasing), is it common to have a 6 monthly market rental reivew as a condition in rental contract? I believe this will reduce the time lag of being rented out at a huge discount in a fast growing market.

    2. I notice that RayWhite is quite new compare to other agents in the area. Could you please give some feedbacks if your IP in moranbah is with them?

    3. If my property has a big lawn, would it be hard to maintain? As in, is it possible to make sure the tenants will mow the lawn? And incur penality in the future if they don't maintain it, such as deducting money from the bond to replace the lawn?

    Please PM me or post it here if you have any PM recommandations.

    Thank you in advance for your infos.

    Cheers
    Talismans

    Profile photo of TalismansTalismans
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    March 30, 2010 - 8:40 am

    Thanks number8, dan and terryw

    @ number 8:

    Say for example, I have 80k in my PPOR offset account.

    How can I just create another offset account? Does it mean I need to take another loan?

    I can certainly deduct the interest from the IP rental income and this shouldn't be a problem.

    This is actually more tricky then I thought…and this is a crucial…

    @ Terryw:

    I thought you can't deduct CG from the income loss because they should be treated seperately?

    CHeers
    Talisman

    Profile photo of TalismansTalismans
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    March 25, 2010 - 11:07 am

    Thanks Terryw.

    Do you know if there's any ways people usualyl do?

    I think it's quite common that pplz take out their equity to purchase investment property, they must have a way to do it! haha

    Cheers
    Talis

    Profile photo of TalismansTalismans
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    March 25, 2010 - 9:33 am

    Ladies and Gents,

    Thank you for all your advices and now I have taken out the equity out of my current PPOR and it is resting at my offset account.

    I just want to know if I use this amount of money to buy as deposit for my next IP, is the interest deductable?

    If not, what can I do to make the line clear?

    Thanks.

    Kind Regards
    Talis

    Profile photo of TalismansTalismans
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    March 16, 2010 - 4:05 pm

    Thanks guys! much appreciated

    Profile photo of TalismansTalismans
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    March 16, 2010 - 1:51 pm

    Thanks Banker as well!

    Profile photo of TalismansTalismans
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    March 16, 2010 - 1:49 pm

    Thanks number8 and YI!

    You guys have both generated a good discussion on this post!

    I'm always willing to learn and I'm glad to see such great responses from both of you guys!

    Profile photo of TalismansTalismans
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    March 5, 2010 - 5:32 pm

    Thanks for your reply RHPlanning.com. =p as long as its family members then its ok i guess

    Cheers
    Talis

    Profile photo of TalismansTalismans
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    March 5, 2010 - 3:35 am
    daniellee wrote:

    That is most odd… especially if I could get better returns than through a typical financial planner.

    Surely there must be another way around this.

    Regards

    Daniel Lee

    Firstly, thanks for all your replies, Terryw, Paul, Richard and Andy.

    @ Daniel

    I think you should probably talk to your bank first and see if they allow you to do it.

    In my case they don't seem to worry what i'm going with my money as long as there's 20% equity of the value of the house there.

    I was just thinking since the interest rate is still low, i could outperform the home loan rate and make a return on the borrowed fund with a combination of a margin loan (50% LVR).

    Kind Regards
    Talis

    Profile photo of TalismansTalismans
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    March 3, 2010 - 1:50 pm

    Thanks Founder, very well said and very kind heart of you bring the warning up  (seriously only my parents would tell me not to do such thing!) I would also warn others who have a similar approach that leverage could be a double edge sword and only to use leverage wisely. 

    I'm going to do some fundamental (then technical to determine buy price) anaylsis on each share that I buy and I will mainly look at blue chips with good dividend payout. In addition, the margin loan I use will probably be 40% LVR to reduce any chances of having a margin call on my shares. It has always been my dream to become a fund manager and I would like to be my own one before I use the money for my next property purchase.

    @duckster: Thank you for your advice as well. Can the interest payment be deducted from the capital gain as well if I sell the share less than a year at a profit?

    Cheers
    Talis

    Profile photo of TalismansTalismans
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    March 3, 2010 - 10:48 am

    Thanks Richard.

    I will talk to my accountant about the details.

    Cheers
    Talis

    Profile photo of TalismansTalismans
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    March 3, 2010 - 10:48 am

    Thanks Richard.

    I will talk to my accountant about the details.

    Cheers
    Talis

    Profile photo of TalismansTalismans
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    February 26, 2010 - 3:29 pm
    Qlds007 wrote:
    HI Blissy

    Sorry to come into the end of the post but can i ask you why you are paying principal & interest and reducing the debt balance ?

    The loan is interest only for a reason and if not should have a 100% offset account linked to it.

    Place all of your funds into this and offset the interest rather than reduce the principal.

    You can use the offset monies as deposit to buy your PPOR or another IP if needs be.
    Make sure you keep the loans separate and do not cross collateralise the 2 securiries.

    Crunching some quick numbers i cant see serviceability being an issue more like the loan to value ratio as 90-95% lvr will be the maximum.

    Your  FHOG will help defray some of the costs but most lenders are going to want to see minimum 10% savings as Stamp Duty and LMI will add up. 

    As long as you can come up with the required amounts no reason to wait if you find the right property.

    Hi Gents,

    What's the implication in this "Make sure you keep the loans separate and do not cross collateralise the 2 securiries."?

    Does it mean that if i wanna use the equity from my PPOR, i should take the equity out as cash n make it as deposit to my new IP loan? Rather than using the equity of my PPOR as a collateralise?

    Cheers
    Talis

    Profile photo of TalismansTalismans
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    February 25, 2010 - 3:15 pm

    Hi,

    I have a similiar situation as well. I'm currently living in my PPOR but planning to move back with my parents in a couple of months. I was just thinking of renting my current PPOR out and at the same time, declaring it as my main residence for up to another 6 years, as long as I don't declare a PPOR else where. Is this valid? or possible?

    Cheers
    Talis

    Profile photo of TalismansTalismans
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    February 25, 2010 - 2:43 pm

    Hi,

    I used First Choice Conveyancing and their number is (08) 94818511.

    They were very polite and efficient.

    Cheers
    Talis

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