Hi – First posting and new to the site; wondered if anyone could advise after I was caught up in the negative gearing hype.
Bought a 1 bed apartment – offplan in Oct 2003 for $208K +$10K improvements (total $218K) in Perth off the plan with 10% deposit.
Due for completion in Dec 2005.
Vacant 1 bed apartment next door listed by the developers for sale at $253 (inc. improvements).
Question – Can I on sell? Should I hold and settle then sell? Should I hold for a year the sell ? (i understand I pay less CG tax this way) or keep and rent out.
FYI – have just bought own home with 20% down, and looking to invest in future in more +vely geared properties in WA.
Any advice appreciated.[blink]
Cheers
KramWhy are you paying for improvements on a unit that is not complete yet? I did not think improvements would be needed on a brand new unit.
Anyway, I would not put much weight in the listing price by the developers at $253,000. They tend to have access to suckers who purchase through organisations like The Investors Club and others.
If you list yours now, it would mean more properties for sale in the development. I don’t know about anyone else, but the more I see for sale, the less I pay. I play them off against each other.
Maybe wait until the unit is sold to determine the sale price and decide from there. If you are happy to take profits, I say why not sell.
The Mortgage Adviser
http://www.themortgageadviser.com.au
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Essential LinksIt would be possible to onsell. Whether you should do this or not would be up to you. You still would not get the ‘profit’ until the property settles though.
BTW, you may be able to sell now and still claim the 50% CGT discount. The ATO class a sale to occur on exchange of contracts – which you probably did in 2003.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
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Thnaks guys – food for thought. V. useful info about the ATO date of sale – will check
Re: improvements- think I meant fit out (Dwasher, a/c, carpets etc.
Kram
MLorkin
HI Kram
If you can get rid of it why not. In the long term this will not be great for capital growth. Remember that even if you do sell you are responsible for the contract until settlement. If you on sell and you buyers falls over at settlement the sale would still be your responsibity
Nigel Kibel
http://www.propertyknowhow.com.au
Australian and New Zealand Buyers advocate
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New to this – so sorry to be a pain. Couple of ?’s
1) I have already paid stamp duty ~8K – is this lost even if I on sell?
2) Do I have to still pay CGT if I sell, take profit and then reinvest it? If not how long can you hold the profit before you have to reinvest?It’s good here![blink]
KramMLorkin
1) Yes
2) yes, have to pay CGT even if you reinvest.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
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