Hi Guys;
we are planning to buy our first IP in our SMSF so is it better to look at a property for capital growth or cashflow in this situation?All thoughts-opinions?
Brian & CindyAsbestos Audits Queensland | Asbestos Audits Queensland
https://asbestosaudits.com.au/
Email Me | Phone MeAny asbestos questions ask me.
Do you want to make lots of money or just a little bit?
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
HiTerry – what am I missing I was told the IP had to be self supporting which would indicate cashflow over capital growth?
Brian & Cindy
Asbestos Audits Queensland | Asbestos Audits Queensland
https://asbestosaudits.com.au/
Email Me | Phone MeAny asbestos questions ask me.
I think the good old days of capital growth have gone years ago
Maybe if you are lucky some small capital growth, but probably capital loss is the expected thing over the last 5 years and into the future.
Good luck
I think there is no point in investing if there is no capital growth. No point in getting $50pw cash flow for 30 years if it only grows at 1% pa. I would much rather losing $50 pw (initially) and getting 7% pa growth. Whether this is possible or not is another matter.
I think you can buy a negative cashflow property with a SMSF, but you will need to cover the costs with continuing contributions.
And, I would much rather just use shares for the SMSF. They are much cheaper to maintain and get into and out of. Property costs are high enough and when going in a SMSF there are even more costs – higher fees, higher interest too, plus you cannot access future equity for future borrowings (I think).
Also it is good to diversify a bit.
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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