It’s my positive cash flow IP & I sold it! It’s a beautiful unit. I feel rather sad. I bought it & put all my savings in there with an intension to use its rent money to supplement my retirement pension. I sold it for the same price as the first owner bought 9 years ago! I’ve made a reasonable profit because I bought it cheaper and did a very good reno before selling.
Now! What should I do with the money?
1. Lend my son a deposit for his 1st home.
2. Give some to my parents & my mother in law.
3. Give some to a Vision program which performs eye operations in South East Asian countries. $100 can bring back eye sight to a person. I will be happy counting how many eyes I can save.
4. The left over money will be used as a deposit to buy another IP.I’m still thinking of what structure I should use for future investment and where to buy. There is no landtax threadhold for Trusts. The extra landtax together with the cost to operate a Trust can eat up a large junk from its cash flow. I’ve been reading past threats to gather more info. I did this against my financial advisor & accountant’ advice so it’s hard to discuss this with them. I learn a lot in this forum. Many thanks to everyone here.
Cheers
Huey
Great stuff Huey.
Contributing to Vision is great stuff.Just out of interest..
Why??
If it was cash flow positive and you sold it for a price that was similar to 9 years ago why sell??
I hope all is well with your health.
Cheers
Calron the Alcamist
Turning things into gold is fun.
[email protected][
]Thanks Calron, I’m in good health at the moment.I asked myself that question many times as well!
I want to help my son to get his 1st home & set up a better structure for my investment. Selling is one of many options. It may not be cost effective but it’s less worried.
Regards
Huey
G’day Huey…
I wish to share someting with you.
In April 2004 I am “Trail Bike” riding from Hanoi to Ho Chi Minh City to rais funds for Vietnamese school we are building in Binh Ba….not far from Vung Tau. Aussie businesses in Vietnam will sposor me at x$ per km…it is a 2000km ride over 25 days.I assume you are refering to the Fred Hollows Foundation…Fantastic, as I have decided to include them as one of the beneficiaries.
TV coverage before I leave with Channel 9 ACA
If you buy the property in YOUR name and rent it to your Son…the interest is taxdeductible. You can have a written agreement to protect him.
SO…
You get an investment property
Your son gets help with his home (in your name)
This scenario may permit your son to buy an investment property
Last but not least…you gret to help Fred Hollows FoundationI know that leaves out your Parents and Mother in Law…but would need to know your total finance structure to advisre further.
Cheers for now…
Billfromoz
Hi Huey
All the best to you. I’m grappling with the idea of selling my ip also but gee its a hard step.
Great to see you donate to a great cause. I’ve been thinking along the lines that i am not properly structured from the start. So in a time where you can virtually name your price to a degree its tempting.
regards
alfHi Billfromoz,
I admire you work. It’s just great. I wish you a good trip & raising lots of money. Fred Hollows Foundation is great. I was informed that in April 2004 a team of doctors & volunteers from Australia will go to the central of VN to perform eye operations. They may wave & say hello to you if you ride pass there at that time.
Thanks for your advise. That is 1 of the options I consider but still feel uncomfortable with the land tax & capital gain tax. The other options are : – My son buys as 1st home owner & gets $7000 FHOG. He pays more bank interest, no land tax, no capital gain tax. – I or him or we set up a Trust, buy & rent it to him. The Trust can claim tax, but have to pay land tax but less or nil capital gain tax if know how to distribute gains to beneficiaries. As I understand I have to set up a complex Trust structure so I can borrow money from the bank. There are costs to set up & manage the Trust but I can distribute positive cash flow money to beneficiaries.
In Canberra there is no threshold for IP land tax. Landlords pay around $2000/year land tax per house, a lot more for inert suburbs. We’ve searching around for a suitable house, 10 minutes drive from my son’s work (work requirement). I think all houses in this area are over priced. We can buy a $350K old house and renovate or one in good condition for $400K. They were less than $200K few years ago. They are rented out between $280 – $320/week. It becomes almost impossible for 1st home owners.
The money I donate & give out is relatively small & I don’t want to skip that. It brings happiness to other people including myself. I just make some extra money so it is a good time to share.
Regards
Huey
Thanks Alf,
It’s hard to sell our IPs especially it’s the 1st IP.
It’s better to do some research & understand different structures for our investments before we see our accountant.
Regards
Huey
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