Hi First post ina bit of a dilemma.
We own one IP and have aPPOR, having trouble making ends meet. Getting advice today my husband was advised by a work colleague don,t sell either property and to rent both (PPOR also) and then to rent ourselves.Would this be advisable????
[anxious][anxious]Hi milnev, welcome to the forum,
I don’t see how anyone can possibly issue you with a sensible answer given the scant 3 lines you’ve offered, with little to no details.
Before taking your husband’s colleague’s advice (his name’s not Dazza is it – like off the TV ads ??) have you had a really good look at why exactly you seem to be having trouble making ends meet. The key might very well lie there, and the drastic action contemplated might not be necessary at all.
A licensed F.A. would rightfully ask you and your husband about 400 questions, describing every aspect of your life…finances / children / ages / ambitions etc before even uttering one word.
Given the details so far, the only possible answer would be only you and your husband could possibly venture an opinion.
Sorry,
IP property is near waterfront in geelong value 255000 rent 220 at present, lease up soon so asking 230 for new tenants.No equity available here.Plans have been approved for a marina to go ahead within walking distance.Loan is 263000, interest 1500.Rates 880.PPOR is valued at 350000, loan 200500.Another good location close to future developments shopping, schools,new ring road. We have been here for 4 Years and originally paid 190000 to build so very good growth so far.Interest 1200.
Rates 1350.We both work full time expences include full time childcare(1100) and extra payments towards secondary and tertiary that we make at present(460).
Is it a good idea to rent PPOR so that we can claim interest rates etc, and find a place for us to rent for a while so we dont have to sell either property both have great potential and would be disappointed to lose either.
thankyou
Hi Milnev,
If you do rent out your PPOR then you will be able to claim all allowable costs associated with this property as deductions. BUT temper this thought with the longer term impact of capital gains tax that may come into play.
Some quick comments that will improve your cashflow.
Investment Property/ies
Are your loan repayments interest only?
Have you had a depreciation report done on your investment property?
Are you using section 15.15 of the tax act to reduce your regular pay period tax thus increasing your pay period cashflow?Other thoughts.
Without being Scrooge – are you living the good life too much?
Are there some discretionary expenses that can be pruned?Derek
[email protected]
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Milnev,
Derek was saying this
If you do rent out your PPOR then you will be able to claim all allowable costs associated with this property as deductions. BUT temper this thought with the longer term impact of capital gains tax that may come into play.But as far as I know, if you DON’T move to another PPOR – i.e. you rent yourself – then CGT won’t be payable until your old PPOR has been rented for 6 YEARS. After that, the rules change. But, if this helps you out, then check it out, and go for it if it helps you.
Benny
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