If you ever lived in that unit, you pay be able to claim it as your main residence and, hence, sell it CGT free. Section 118-145 of the ITAA (I think).

If not, it may still be worth selling. You have to add up all the costs – agents fees, CGT etc. and then you will eventually be replacing the investment with another prperty so you should included the purchase costs here to: stamp duty etc.

Just work out al the sums on selling and the interest savings if you sold and paid down you loan.

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He is probably locked in.

The fact that the proeprty was pass in at the auction is irrelevant. He then negotiated with the vendor and signed a contract (did he actually sign?). If finance was not listed as a condition, then no luck there either – it is not part of the contract.

Maybe he could talk to the vendor who may let him out. If not, he could be sued for the deposit and any shortfall for what it subsequently sells for.

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I don’t think they are. They would possibly be treated as capital expenses, so you may be able to claim them if you sell a property at a later date.

If you are using a trust, then they possibly could be claimed by the trust.

I am not an accountant.

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No big deal.

My grandfather’s girl friend stole his. You just have to approach the Land Title’s office and apply for a new one. need to show rates statement etc and wait a while

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This is were is is important to get broad advice from a number of sources. Solicitors and accountants may not realise that many lenders request guarrantees from named beneficiaries. They can still be beneficiaries, just don’t name them specificially. It only complicates things.

Many lenders will try to tie you up with as many guarrantees as possible. Why not? They are simply protecting themselves.

If you have a trust set up with named people, it would appear you are operating a business with those people – that is their reasoning anyway.

Beneficiaries can be added and removed easily, but please be careful. Any changes here could mean that the trust is resettled. This means the old trust dies and a new trust is formed. As such, Stamp duty and CGT on all the trust assets currently held could be payable.

Grant your accountant is correct about the guarrantees and trusts. But if a person willingly signs a guarrantee, then they will be held liable.

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I chose to rent a place. Where I live the ppty yields are very low, and there is high strata fees. Growth has also been low. When I started rented the place about 7 years ago, I considered buying there, but instead bought a similar priced proeprty in a different area. This has since tripled in value, while the place i am renting has only increased slightly.

I am probably saving about $20,000+ per year in renting, plus can claim additional tax deductions on hte investment property, plus I can claim one property as my main residence for CGT purposes at the same time.

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That article is about no deposit home loans. For these you need to be squeaky clean with your credit report and have stable work history etc.

I think many people after vendor finance are the credit impaired, or people that otherwise don’t meet the normal lending criteria.

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Hi HB

If they pulled out, they would not get any reimbursement. They are taking a risk by paying a bit more rent, but ending up (hopefully) buying the property below market rates.

Incidently, I wouldn’t do this again.

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Just make sure you get insurances that cover you. Otherwise, if he is doing something illegal, and something happens, you may not be covered?

What is the capital growth potential? Is it is a good area?

What happens if this guy goes down. could you rent it out yourself at a similar amount? Or how much would you have to drop it, if you couldn’t rent the rooms separately?

What LVR will your bank lend? Probably standard, as you will be just renting it to one person, not operating a boarding house.

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