Forum Replies Created
I love the way he (Smith) talks about being critical of them for "not recognising the signs"…what the hell has he been doing? he and his direct team are hardly a bunch of clueless 20 somethings who made money because they were in a boom rather than having any special knowledge or skills. They are supposed to guide the operational and strategic course of the company and it seems they have been asleep at the wheel and not reall aware of what their people were doing. Says a lot about governance at ANZ. Now he is pontificating and expects people to take him seriously ….. good on the analysts at the last announcements on further losses for questioning his credibility. And no I dont hold ANZ shares …. I just get pissed off with people not taking responsibility for their own actions….or maybe inactions in this case.
looks interesting, but convoluted, its not clear to me when you would actually see your money. Sounds like it would come back in dribs and drabs and of course there is no gurantee they would be effective in selling the shares…..I would be wondering that if the return is so great and the development fairly small , why would they even advertise it to the public? wouldnt you just do it yourself or form a small tightly held JV.
Hi Mister
You paint a fairly bleak picture. Where do you think its substantially better than here? we live in a western commercially oriented democracy, so greed or the profit motive is a big part of that.
Re your question yes I want my kids to have a life and my 20 somethings are buying homes and getting on with life in their own way (one with my help and one without). Really I dont think things are that bad but I have always expected to be self sufficient and I am not affected by the wrongs of the capitalist system…….as long as they dont make it compulsory for me.
truisms re land appreciating and buildings depreciating dont really mean much, the focus (I think) should be on location. You really cant have a meaningful conversation about land vs house/unit without the context of specific deals. In general terms residential land will have holding costs with no compensating revenue, so the end sale price needs to compensate your holding costs and give you your target profit.
in general terms, add up all your deductible costs and depreciation, subtract your rental income , balance if your nett loss . Reduce your general income by the amount of the nett loss, recalculate tax on the reduced income. Roughly the amount of tax you should gain is the difference between the two tax numbers…….this is assuming you have not put in a tax variation to have your tax reduced during the year rather than waiting until tax return time.
bias is shown here in both directions, +ve and -ve, there are some here that preach gloom and doom and seem to rejoice in that and the pain of others…….like the "enjoy" comment when posting a -ve article. Its easy to do a search on posts by individuals, when you do that its fairly easy to see who is trying to help others and who is trolling or just pumping up their own tyres. The desparate need to feel superior displayed sometimes gets to some people and they bite, others just let it go.
if you objective in investing was to accelerate paying out your PPOR then it sounds like a good plan.
The -ve is getting rid of a property just as it goes +ve cash flow. That should be a long term income stream and appreciating asset for you. Really I would be more concerned about the 2nd property and the overhang it creates in your whole situation. Guess it depends on how optimistic you are re future income and the property market.
Hi
really there is insufficient info provided for people to make a sensible comment. Some of what you have said is confusing….you owe 100k on a 225k property but can only take 50k out? is there some reason you can take it up to 80% or has the value dropped. Plan sounds nice in theory but without knowing costs and borrowings who knows if its viable. Tax benefits? I assume he means -ve gearing. You arent on a high income so the tax saving impact wont be as high as the top tax rate and remember you get these 'benefits" because you are losing money (interest and costs greater than rental income).
Can I ask why you are waiting 2-4 years to act on the development? With a $77 k salary and servicing losses on 2 rental properties and paying rent you wont be accumulating money to act on the plan so why wait. or is that just how long it takes to get development going in that area?
Be careful that you have insurance cover that matches the arrangement you propose. I beleive that you can split the lease as you propose , but I also found out that some insurance companies are particular about having all parties on one lease and a minimum lease period. I am guessing they would want a higher premium for the arrangement you propose …..assuming you run with insurance
jeeez…….I am probably just being harsh but you dont need advice desperately and there is no reason to be anxious….you are just dissapointed that you cant eek the last drop out of a free rent arrangement. Good luck to you if you can but if not just get on with it and your renos will come a little bit later, its not a drama.
what do you have in mind re financing? it sounds like you are minimising your tax deductible debt and maximising your non tax deductible debt.
Hi
I can only suggest common sense type stuff…..go there, talk to people, get a sense of activity or lack thereof…..look at the internet to see how many properties for rent, what rental levels, are they letting or just sitting there?
Based on what you have said are you sure you want to do the remote investment thing? If you arent motivated to go and have a look at the property now, and you dont trust the agent, what will happen when stuff needs to be done to maintain the place. People make this work but you do need a trusted partner.
only spent a brief period there and it felt like an artificial movie set plonked in the middle of desert, bit like Las Vegas without the fun. In any case I already invest in Dubai, I buy petrol.
a couple hundred years ago people "knew" that all swans were white….then they discovered Australia and found that black swans actually existed. I dont think the global house price crowd know anything for sure….they have a theory based on their perception of fundamentals and history. We are going through unprecedented times with wars, peak oil, sub-prime, climate change all happening together, and personally I think we will be discovering a few new black swans i.e. finding that things arent happening as they did in the past and/or new opportunities we didnt even consider now exist.
Nobody knows what is going to happen. If you really have a long term view and but a place that has points of difference (not yet another generic 3-4BR house in a massive subdivision) you will be less effected by a slump. At the end of the day the price fluctuations only matter if you are a short term investor or they are large and relatively permanent as the doomsayers suggest. If you want a relatively risk free life then pop the money in a term deposit and take the 8% while you sit on the sidelines, at the moment there doesnt seem to be a strong growth train you are going to miss.
I think whether 50/50 is fair depends on who wears the financial risks if things go pear shaped. If you sign up for some of that that then 50/50 profit share may be fair. If not I wouldnt want to be on the finance side of that relationship, as I could get saddled with everything and you could walk away as you really dont have much skin in the game.
a friend of mine has always rented where she wanted to live and invested where the capital gains were good. If I was starting out again I would do the same and maybe sell up later and buy a place when I got older and wanted some assured security/stability….but who knows that far down the track. I dont really see a downside to having some tax deductible IP debt and some partially tax deductible rental…..you have a good plan, unless I am missing something or tax policy changes.
There is usually one fee for re-letting and one fee for renewing a lease. They have not had to do the work involved in re-letting, so they should not charge that fee…..although they may try it on. This should be contained in your management agreement. Why not get on the front foot and call them and say you are expecting the renewal fee and what is their intention.
On another point, just make sure that how you have the lease set up matches your insurance companies needs. Some companies have particular requirements when multiple unrelated individuals occupy a house e.g. all parties to sign lease and minimum lease periods.
go with the newer property…..more rentable (modern, garage), better depreciation…..as soon as you said pool with the other one I was gone……just my opinion but pools and rental properties arent a good mix.
Tools wrote:Hi guys.I am trying to work out what land value would be in Carlton, but it is alittle difficult when it is such an established suburb. How can I work out what it might be? ANy other opinions on Carlton would also be appreciated.
Tools
guessing somewhere between $500k and a million +, depending on size and location. While we were looking around Thornbury (6km further out) last year , people were paying $500k for old houses and demolishing just for land. Really with Carlton it just depends on how deep the competitions pockets are. Opinions? parts of Carlton are beautiful , tree lined streets and to me ideal inner city living…other parts are full of student accomodation and restaurants (for me , OK to visit not to live near)
adriannqld wrote:Random Question.Why must property prices return to 3-4 times the average wage??
Is this a fundamental or an assumption.many seem to think thats what the number used to be , so thats what it should be now and in the future
if you beleive that everyone should be able to buy a home then its a nice social objective, and more affordability would add to general activity you would think.
personally I think that this tends to be bit of a BS number and maybe should only be used as a guide to overall trends. Yes its more expensive now than in the old days …. what makes us think we have a right or expectation to levels that existed in the days? how many off us want to back track there as a way of life? not many i'm tipping….even though things like peak oil/global warming/sustainability may put us there kicking and screaming.
The balance between wage multiple to house prices is significantly affected by your expectations (where do I want to live and what do I just have to have) and earnings (am I prepared to pull my finger out/take risks to be more than an average wage earning drone)
