You could do that. Claim half the costs or based on floor area. Part of the furniture may be depreciated too.

There is aparently a newish building in Sydney which was set up as Company title with one of the reasons being that a shareholder cannot just sell to anyone. Any new purchaser must be approved by a committee of other shareholders. This way they can control who buys into the buidling.

In NSW there would be stamp duty on the transfer. However, stamp duty is due to be abolished on the transfer of shares in private companys from July 1 this year (may not happen).

My thoughts – bad idea.

What is the point in investing without growth. The biggest problem is that this eats into serviceabilty reducing borrowing capacity and uses up deposits which could be better used elsewhere.

Have you factored in costs related to borrowing the stamp duty etc. Repairs? – every 8 years replacing the hotwater service, every x years replacing the carpet etc.

What about rate rises?

Without growth there is absolutely no point in investing. What about shares instead? Some good high yielding shares would achieve a better result. You also get franking credits.

The first valuation, was that before you signed the contract?

Once you pay for something that largely determines the valuation. So getting it for so low would mean it is really only 'worth' that much.

Did this valuer provide comparable sales?

Banks can only use valuations if the valuer is on their list and the valuer has been instructed by the bank. Speak to a broker who may be able to use a bank that allows upfront vals such as ANZ or Homeside.

Close call!

If your house is worth $420,000 and if you own 50/50 you would have to pay her $210,000 for her share (50%). Borrow $210,000 to do this. Transfer at full market value so you can claim the interest on the loan. Your new loan would be something like $120,000  (your share of the existing loan) plus $210,000 = $330,000 which is 78% LVR.

CGT needs to be considered – wife may be exempt if this was the main residence.

Stamp duty. Generally on the value transfrred unless hte property is in VIC where this may be nil.

Doing this would release about $210,000 in cash into your wife's hands which could be used to pay down the loan on hte new property. Extra interest claimed each year would be about $210,000 x 6% = $14,400

If you sold the house outright you would get $240,00 in your hands after paying out the loan.

This would mean you have another $240,000 which could reduce your new PPOR loan. A loan of $240,000 less would save you about $14,400 per year. in interest.

But you also have to crunch the numbers on buying your wife's share and then property via negative gearing.

If you have funds to build and parents have then why not just enter into a JV agreement and slit the profits accordingly.

You’ve just done it!

Jac, don't know if adverse possession could apply in this case. The person must be in possession of the land for 10-15 years (varies state to state. 10 years in NSW I think) to the exclusion of others. This doesn't appear to be a fence out of alingment but just a fence that will be extended. Any aplication for adverse possession would be complex and very costly.

What could work is to apply for an easement. There is an implied easement which allows the back garage to be accessed. It sounds like all the information was in the contract and the survey, but it wasn't something that stood out.

Don't forget stamp duty in ACT may be deductible against income as the land is lease hold.