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Hi there.
This is how I understand the process, correct me if I am wrong, Thanks!
Bank Loan – $400k
House price – $500k
Stamp duty etc – $30kCome up with $100k for deposit to avoid Mortgatge Insurance. Now on the subject of Mortgage Insurance (MI), is it necessarily a bad thing? Everyone I talk to, try to avoid the MI and the extra costs etc, I don't know what it will cost for $530k. Can someone comment about MI?
Continuing with the example that I understand.
One borrow $400k to purchase $500k property (80%) and settles the transaction (minus stamp duty etc) leaves say $370k. Now the entire loan amount is tax deductible in the eyes of the taxman. That $370k will then be used to purchase a PPOR property.
Now that would mean the $400k loan interest, fees etc can be used to offset my taxable income whilst having freed the money to purchase our own home?
Have I got it right with the theory here?
Thanks a lot
Hi Richard,
Thank you for your reply.
The problem is that we never envisage going over to Qld to work and that we would have paid off the HP house in another 6 months as PPOR.
What are the rough $ estimate to setting up a trust fund and benefits of trust structure in my situation?
Can you provide some numbers for consideration as I am new to this trust structure. I have always thought of the simple method of buy and hoard strategy, hence the Bentley being interest only as I am not living in it, and Hamong Park P&I as I am living in it. The strategy was simple. Pay off HP and look for another investment property and grow it one at a time. Simple.Surely there must be a quicker way to grow.
Thanks in advance Richard, your advice have helped me in the above and realised that there has to be a better way to do this.
Cheers,
VincentHi MC,
As a student renter from overseas before, I have since settled in Perth to work. As far as rent is concern, it’s a matter of when we have the money is when the rent is paid. Sometimes, we need a breather too when our car etc breakdown and need that rainy day money. Basically, we want to have a relatively peaceful time too, without too much fuss from landlords.
As far as rent range is concern, we have rented in Bentley and surrounding suburbs… close to Curtin University. Rent range from $70-110 per room per week plus outgoings. At the $70 scale, it was just livable and not secure. At the top end, it was a brand new 2 year old units in a block of 6 with security gates etc.
There are two groups of student renters i guess, one is the stay put sort (incl holiday period during uni) and the other is the holidaying sort, that goes back home (oversea) or around Australia.
And LifeX rightly pointed out that student accomodations usually goes on for 9 months, but then having said that most students that goes back home for a holiday, are mostly not prepared to move all their belongings and would put up 1/2 rent to store their stuff during the holidays anyway, which I did.
As far as vacancy rate goes, it just depends on your policy… if you are a good landlord, words get around, there will be a queue to sign up with you. For example, we had a landlord that had students that were referred by us because of how she operated as a landlord. When we moved out, our friends moved in and she signed them up on a new lease. There was never a time that her properties were vacant.
This is all my experience so it might not be an accurate view of renting. [biggrin]
Hope this helps!
Vincent
