Hi Tony

I don’t take inflation into account because working in todays dollars should be enough as long as the property and rent growth is the same or more than the inflation the passive income goal should match todays dollars – or be better.

Why not just get a second valuation, and a 3rd perhaps. You could agree that the price paid to the other party is the average of the 3.

Work it out like this
1 estimate the yield of the types of property you are after
2. reduce this by about 1% for costs
3. Divide the desired income by the figure in 2

In this case assuming you get a 5% yield, take this as 4% after costs
$250,000 divided by 4% =$6,250,000

So you will need $6,250,000 worth of unencumbered property to get an…[Read more]

I guess it gives you more flexibility to move lenders. But other than that not really.

Uncrossing is good, but it won’t help you pay off a loan any earlier.

Why not approach the same developers that have done projects in the same street?

Benny trusts cannot distribute losses but what you may be thinking of is some borrowing to subscribe to units of a fixed unit trust and the trustee using that cash to pay for the property. Those borrowing to buy income oroducing units could claim the interest against their own income. If they are individuals and the interest is less than the trust…[Read more]

Yes it is worthwhile considering it for a variety of reasons.

Costs
– conveyancing
– stamp duty (possibly depending on state)
– CGT
– GST
– mortgage discharge fees
– new loans

I think increasing the loan shouldn’t produce any tax issues if the loan itself relates to only the units. Once complete the loans can be split and the property strata titled At that point the security for each of the 3 splits can be secured by the unit it relates to.

Get tax advice.

NSW property?
STRATA SCHEMES MANAGEMENT ACT 1996 – SECT 109
http://www.austlii.edu.au/au/legis/nsw/consol_act/ssma1996242/s109.html

Yes it is possible to structure a company or a trust so that only one of you will need to give a guarantee.

Although transferring to another entity will result in stamp duty and trigger CGT it can be beneficial – especially if there is a bit of equity that has build up.

Where did you ‘pull the equity’ to?

Companies get a separate land tax threshold in most states and they can retain earnings too so they can be a great way to own property – tax can potentially be less than that in your own name.

Your step dad’s company can lend your company money and can secure this by taking a second mortgage, either registered or unregistered. This should help…[Read more]

You should get some legal advice as there are many ways to structure this both inside super and outside. It might be advantageous to set up a second SMSF for example.

I believe it is just a marketing term – the name doesn’t really matter. If you want asset protection on bankruptcy you should really get legal advice (from a lawyer) because the trust deed is only one part of it. The important part is how the transactions are structured.

For example if you make a ‘gift’ without anything changing hands the gift…[Read more]

One additional thing – what will be the consideration fro the sister becoming legal owner. Will it be a gift or will she be paying market rate for the property, or even undermarket rate. This has far reaching tax and asset protection and estate planning issues.

See legal advice!

Why cannot she give legal advice? Perhaps because a conflict of interest. If she is operating a business selling products then she may not want to advise on those products because it could be deemed biased.

You should get some legal advice on the consequences first and decide how the property will be owned – JT, TIC in equal shares, TIC in unequal shares.

Then egage a conveyancer – which may be the lawyer you used above.

sister will pay the stamp duty on the value transferred to her.

It will be a CGT event to you and/or husband who are…[Read more]

Impossible to advise on such a general question. Best course of action may be to start reading as much as you can.

that is like asking “what should I eat for dinner”

It depends is the best answer.