Hi all
well i am seriously considering becoming a tenant and rent.
Rent out my own PPOR what do you forumites think.
Any of you done this and how have you found it.
rentals here in adelaide reasonably nice house and area $250 a week.
It seems to make sense.
Rent yourself and invest.
regards
alfG’day Alf…
If you rent out your home and then rent another where’s the gain in doing that mate?
If you sold now and stayed cashed up for the buying opportunities in a year or two…then that may make sense. But pretty hard to pick tops and bottoms of the R/E Market.
I wouldn’t sell a Personal residence and buy in the same market today.
Cheers…. clarify No1 or have I misunderstood?
Bill
Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
[email protected]Hi Bill
Well its just a thought at this stage.
But looking at it the PPOR becomes and IP.
The interest on the loan becaomes tax deductable
With a good quantity surveyor should be some depreciation there house only 2 years old
The house would be positively geared
If still have other IP would then help with the negative on that one.
My personal taxable income after depreciation etc would be lower.
Can always move back after a year if it doesnt work.
I have heard that as along as you move back within six years then no CGT if sell. But i would never sell this particular property.
I am looking at contingency plans if rates start to move aggressively and sitting on a variable arrangement is not comfortable. Even though i know over a long term it may be better.
regards
alfAlf
I’ve had the same thought recently as my parents who live up north are thinking of an investment property.
Firstly my residence becomes an investment and costs therefore tax deductable, we’ve improved the place a lot since we’ve been here and the suburb has ‘jumped’ in value to our delight (we made a good choice- always good to get that” i knew i was right feeling”)
Secondly it costs less to rent than it does to pay it off, plus any problems with the property- i speak to the owner.This frees up a bit of money
My folks benefit by having a great tenant with a good attitude [:0)]
At this stage just thinking also Alf
Any thoughts out there..?
Redwing
“The man that thinks at 5o as he did when he was 20 has wasted 30 years of his life”
Hi Alf,
You are right about the six year period, but that is only if you elect to keep the property as your main residence. You can move out for up to six years and the property will maintain its CGT exempt status. You can then move back in, establish residency, and then move back out to extend for another six years.
Sunshine
Hi Alf,
I remember at one of The Investors Club meetings a few years ago, someone said something like ‘I rent my son’s property, he rents mine and we both have an excellent tenant’. Seems to make sense if it is where each wants to live and you can always change back if it isn’t working out.
Anna
I remember at one of The Investors Club meetings a few years ago, someone said something like ‘I rent my son’s property, he rents mine and we both have an excellent tenant’. Seems to make sense if it is where each wants to live and you can always change back if it isn’t working out.I was at a seminar as someone asked if the “i rent from my son and my son rent from me” arrangment is okay. The presentor said the taxman keeps a very closed eyes on renting between family members, so be very careful if you want to do something like that.
Also consider if you can somehow use the new rental property for your business somehow – eg home office etc. You may hten abe able to claim part of the rent as a deduction.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
At about the time my sister and her husband were buying a PPOR, my folks were looking to buy a house on the South Coast – their ‘retirement house’. I tried (in vain) to get my sister and her husband to buy the one down the coast, and my folks to buy the one they wanted up here.
Even did heaps of numbers (i’m a numbers person) for them to show how much better off they would be taxwise, and how much quicker they could pay the house off, but no, brother in law wouldn’t be in it.
Funny that the house my folks bought has gone up (conservatively) 250%, and my sister’s house almost 200%.
Cheers
MelHi all
well i possibly am thinking that one could make a case to opt for renting for a while. Rent their own PPOR and then if they want within 6 years move back in still CGT exempt.
Doing the numbers would be interesting.
regards
alf
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