I recently invested in my first IP in Homebush West – Inner West Sydney.
The property is brand new so I received the full grant.
2 bedrooms, 2 bathrooms, large storage room next to undercover parking
Purchase Price: $340,000
FHOG: $24,000
Rent potential: 380 – 400 p/w (let me know if I’m wrong)
Has anyone else invested in this area, or surrounding areas?
Your figures look good to me.
Hi Rambo,
Happy New year!
Yes, your numbers look right, though my partner was able to negotiate rent at about $415-$430, same area…
Amit: please email me your email address and a contact number so that I can add you to the list, as I haven't come up with the next dates this year, its been pretty busy for me, moving house, a baby on the way, etc, etc, but I will definitely keep you uptodate with next meeting dates.
my email is [email protected]
Cheers!
Anna
I've looked at homebush west but was put off by the large numbers of units in the area – might make it hard to sell as there's generally lots of others selling at the same time.
you need to live in it for 6 months to claim the FHOG, but when you turn it into an IP make sure you get a depreciation schedule done to maximise cashflow.
Sorry if this sounds stupid, but what is a depreciation schedule, and who normally goes through it?
What's a rough figure I can claim back? I heard it was around 5k, for the property I'm purchasing.
My unit block has around 25 units and all sold in 2 weeks. However, I hope I made the right decision to buy here. I’ve been looking at the rental value, and it seems to be renting quickly – around 380-400 p/w.
these guys are pretty good:
http://depreciator.com.authe exact figure will vary so I don't know how much you can claim through your IP. but you can try the online schedule here:
are you going to rent yours out immediately or live in it for 6 months?
Live in it for 6 months. Rather live in it when it brand new!
Do you think its better to rent out first, as I can claim this FY?
Rambo,
Renting it out in the first 6 months would be a big mistake!
1. You will breach the rules of the FHOG and could be asked to cough up the $24k back if you are unlucky enough to be audited.
2. You will lose the eligibility for the 6 year CGT main residence absence rule (and have to end up paying CGT when you eventually sell the IP).
The extra cashflow for the first 6 months may be tempting but better to live in it to establish it as your main residence first, before renting it out.
Feel free to email me if you want a copy of my article on the 6 year rule mentioned above.
Thanks for the advice Kevin. Appreciate it.
However, I was under the assumption that I would have to reside at the property within the first 12 months. So I could rent for say 8 months and reside after that period (before it reaches 12 months).
Also, it would be great if you can let me know if I require a 'depreciation schedule', or if an accountant can take care of calculations.
Hi Rambo … don't assume and take good advise,
Your property looks great … work hard and invest as much as you can into the mortgage to reduce debt which will increase yr cash flow when u move out after 6 months … hint!!!
D …
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