Hi all,
Something I've been querying for some time now.
Once people get to that point where they think they can retire, what is their plan?Lets say my wife and I accrue 5 rental properties over the next 10yrs and we think we'd like to retire. We don't own any of the properties outright as they've all been IO loans. So should we sell 2 or 3 of them to pay out all debts, or is there another (better) strategy? I understand banks are unlikely to lend us money to finance any more properties but as long as the mortgage is covered by rent and each property is providing some level of cashflow would we be better off keeping all properties?
I'd be interested to hear what others plan to do. ie how you intend to utilise your property once you decide to retire?
cheers,
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MarkYou could look at purchasing them in unit trusts as you will then be able to transfer the units into a SMSF to enjoy the tax benefits. No real need to pay down the loans as long as the rent is covering the interest and you have enough surplus to live off IMO. Over time, the value of the loan with respect to the rental income should decrease, and so you will be able to pay them off eventually if that is what you wish.
Cheers,
LukeThis might sound like a useless answer, but I'd seek advise from an accountant who is experienced in dealing with property investing. The choices are indeed many, but an appropriately-experienced accountant can give you advise on how to grow and protect your investments, the use of trust structures, talking about implications of tax and other major issues.
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