Hi All,
Settlement for our first home is tomorrow. We ended up accepting the property with a tenacy agreement for 8 months as our own lease is not up in our current place until a similar time.
Couple of questions:
1. Is landlord insurance a must? If so, any recommendations of good products?
2. Is anything we do to the property over the next 8 months while tenanted tax deductible?
3. Is 5%+GST a reasonable fee for property management? (we were thinking of retaining the current managers as we don’t know any others and don’t really know what to look for.
4. If we want to get the tenants out before the 8 months what are the consequences of terminating their lease early?
5. Should we convert to IO loan for 8 months?
6. Anything else?!!!!As you may see we are novices in this and a bit nervous taking over as landlords until we can move in.
Thanks!
wickl wrote:Hi All,Settlement for our first home is tomorrow. We ended up accepting the property with a tenacy agreement for 8 months as our own lease is not up in our current place until a similar time.
Couple of questions:
1. Is landlord insurance a must? If so, any recommendations of good products?
2. Is anything we do to the property over the next 8 months while tenanted tax deductible?
3. Is 5%+GST a reasonable fee for property management? (we were thinking of retaining the current managers as we don’t know any others and don’t really know what to look for.
4. If we want to get the tenants out before the 8 months what are the consequences of terminating their lease early?
5. Should we convert to IO loan for 8 months?
6. Anything else?!!!!As you may see we are novices in this and a bit nervous taking over as landlords until we can move in.
Thanks!
Hi Wickl
Congrats on the settlement.
1. Yes – take it out. It’s a deductible expense that provides peace of mind. Try Real Insurance, ING, Terri Scheer. Also do a search on here – others will recommend more.
2. Get advice from an accountant – some may be depreciable during the time it’s an IP
3. Sounds good to me. In the ACT you’d likely be paying at least 8% + GST
4. Checkout the tenancy laws in your state. A lot will come down to whether it’s a fixed or periodic lease (the latter is more flexible)
5. I would – with an offset attached. Start using the offset once it becomes a PPOR
6. Celebrate – well done
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
5%+ gst is a cracking rate. My only concern would be the quality of the pm.
The fixed term of the lease is just that, a secure length of tenancy. If you wish to break it, there would be penalties eg relocation costs, lease preparation fees, any difference in rent payable etc.
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