Hi,
Am just writing to see what suggestions others may come up with for a little conundrum!
We have been saving our pennies, as well as reading Steve McKnight's and other investment books. So we are preparing to get into property investing with the aim of beginning with positive cashflow properties for starters. A major goal for me in particular would be to have an income or certainly money behind us, so that we would be able to have kids and stay home rather than feel compelled to be both working full time.However, we recently visited a financial advisor who recommended buying a house of our own and pouring as much as possible into that as interest is not tax deductable.
This doesn't sit well with my passive income plan, and houses where we live at present are a bit out of our price range, and we don't want to be here past the next couple of years.Does anyone think it would be feasable to buy a CF+ property, start having someone else pay it off, keep saving, and still have a deposit from our savings, plus profit from CF+ property to put into PPOR when we do buy it?
I am getting a bit confused, seeing so many possibilities and not knowing which course would be best.We are also considering RESULTS program, though it seems a huge commitment, well worth it I am sure, but a big leap!
Any ideas would be apreciated, or recommendations for investment friendly financial advisors, preferably in inner north of Melbourne.
Thanks so much in advance for your thoughts!Have you considered if you are eligible for the first home buyers grant. As up until the 30th of June 2009 it is a large sum of money that could help you buy a PPOR.
You could live in it for 2 to 3 years or even 12 months and then rent it out or sell it.
If you pay a large sum off the PPOR loan principle you can borrow against the increased equity up to 80% for an investment property later down the track.
If your PPOR achieves a capital gain it is exempt from Capital Gains Tax while it is your main residence.
see
http://www.firsthome.gov.au/if you do not own a ppor then you will have to pay rent to live in somewhere or live at your mums house.
Hi,
Thanks for your reply. Yes we would be eligible for FHOG. We are renting at present, both of us have been for some years.
Another idea we had was to buy a bigger block, and build a second house on the back and sell it off, while we live in the front house. We could then rent or sell that to buy our 'dream' home later on.Yes you could do that but the subdivision would effect nulify the exemption status of the PPOR in relation to Capital Gains Tax.
Richard Taylor | Australia's leading private lender
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