Hi,
This is my fist message on this forum, hopefully not the last
At the moment we are looking to buy our first property to live in. There is a good one, but it is leased until late next year.
In general, we don't mind renting it for several months before moving as we still getting FHOG in but the question is whether we claim back any loses from rent before we occupy the property providing that we claim FHOG?
Couldn't find any information from official sources..Thank in advance,
Vital
Hi Vital
The fact that the property will eventually be you PPOR has no bearing on the fact whilst it is treated as investment property you are able to claim the appropriate Tax deductions on it in relation to the rent etc.
Richard Taylor | Australia's leading private lender
Thanks Richard,
I had a feeling that legislation does not consider this as a special case. The only potential problem I see here is that I am claiming FHOG on that property. The deal look like this : the property is leased until late next year. We are going to lease it until contract is up and then move in and it would be great if we can claim all mortgage related expenses for the first half a year, but I heard from one of my colleagues that if FHOG is claimed you can't claim it as investment property until you move in and live in for 6 or more moths. That's really confusing me.
The other option is to ask the tenant to agree to break lease. We did this so we could sell a property with vacant possession. The Tenant and us, as the vendor, agreed to break the lease on the condition that we paid the tenant an agreed figure as compensation for the cost of moving (phone reconnection etc). Our Agent looked after all the fine detail to make it legal. It actually did not cost us much. Maybe you could approach the agent and ask the current vendor to go down this road if you want to live in it straight away. Of course the tenant does not have to agree, but it can't hurt to ask.
Jodie
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