- Spandex wrote:I would like to buy in a new, up coming estate. Im here for all open advice in which path I go down.
Spandex,
What is your reasoning behind wanting to buy there?
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
Hoping for a cheap start, and good returns in 10 to 15 years.
But what are you basing that on?
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
BTW, I am not trying to be a smart arse or have a go at you, just trying to get some critical analysis happening.
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
Friends returns from those actions, im here for advice, im not saying mine is true,fact etc. you guys know muxh more then
I do.If you were in my shoes, 2100 a week before tax. Able to use around $60k from my mothers house for a desposit, which I need to return in 12 to 18 months. Put away $1000 a week after bills. Im 24 and moved back home to help set myself up in life.
Dont have time for reno’s due to work any more.
I would be inclined to look for something cheap in a major capital city. Something with a relatively high rent return already and with potential to increase by tidying up the place – not necessarily you, but tradesmen. Some area which will be pulled up by the growth in surrounding suburbs. eg Sydney is extremely expensive place to live and rent, but it is still possible to buy 3 bedroom houses for $200,000. My reasoning is that as prices rise and peple can't afford to live in other areas the demand for these will rise fast and prices should rise more than average. (this may turn out to be wrong of course). You might get $300 pw rent for these or even more. Check out Nathan Birch who is going great with this strategy.
Also get your structure planned. Research the tax angle and keep reading as much as you can.
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
Thanks for the advice, im reading as much as I can. Thats why I joined for advice.
I would like something in melb, as its where I live, first place I would like to be able to see often. Next ill go where the money is. I want my first local just in case anything happens in life I have a place to liveYes, good idea. You may be able to lve in it for 6 months and get the grant and stamp duty exemptions too. Then you can class it as a main residence for years 6 while you move back home and rent it out and keep it CGT free.
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
Personally, I would buy a $60k 3 bedroom house in a major city in the US that is increasing in population. Rent that out for $1000pm. Have all the nessesary insurance, costing $1500 max per year.
No risk. But that's what I've done and am doing now more than ever.
Not keen to buy o.s
And some people like to buy their milk from 7/11 and not from Aldi. Personal choice.
Spandex,
The main thing is that what ever your decision you have to feel financially comfortable and follow your long term vs short term plan/stratergy.
Im unsure that is why im here to ask.
Your short term and long term goals is something you need to think for yourself, and you can then try to formulate a strategy to achieve those goals, possibly with the help of a financial planner that has your vested interest at heart. As many members in this forums mentioned, properties are only a medium to create wealth, and tax benefits associated with them should not be the primary reason for your investment decisions.
Thank you for your post. Long term wealth is my goal. Tax reduction would be nice, but if that means less profits. Its not worth it. I am not solely focused on the tax side of it
Spandex,
that is a vague goal. Its like going to the airport and when buying the ticket saying i want to go overseas at some time in the future.
If you want to speed up things you need to define wealth, ie set a figure and the set a plan on how to get that amount of wealth. (you don't have to put it up here though)
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
Want to be able to semi retire at 40, so in 15 years. I work 7 days a week now, trying to build my wealth for later in life. Working isnt life
Now work out how much money you need and then how many properties (and/or other methods) you would need to achieve this and then a strategy to get those properties.
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
I invest in…and sell (just thought id let my position be known from the start) to my clients properties in regional Qld where capital growth will surpass that of the capital cities in the coming years. That is not just my view, it is the view of the majority of the big 4 banks. net rental yields are around 7% for a stable long term area, and capital growth has average 23% pa over the last 10 years.
My clients buy a 4 bedroom, 2 bathroom, double garage house for around 450k. They then rent it out for $600 per week. It is technically negatively geared before tax (to the sum of $7000) after you consider management fees, rates, any vacancy rates etc. However depreciation for the first year is $17,500, then $16,500 and so on as the years go by. Rents rise by about 10% per annum also. By the time tax breaks are applied to the negative gearing with the out of pocket expenses plus depreciation you are receiving $9000 of tax back. so by reducing your taxable income you actually are making the property positively geared. Not to mention construction interest in the first year is a tax deduction, compared to paying a large amount of stamp duty which is not deductible if and when you sell. (you mentioned you plan to never sell so you may never be able to deduct your stamp duty). Oh and the Qld government will give you $10,000 tax free for building a new property in the next 6 months.
Does this help? I know it is biased advice but it is a proven strategy that my clients use to help build their property portfolios quickly. Remember every negatively geared property you buy, it reduces your income which reduces your borrowing capacity to expand your portfolio.
Regards, Josh
[email protected]It would be a good time to look aroud the north coast nsw, in my line of work I see plan for new road works and hear all the proposals of upgrades. The pacific Hwy from Byron Bay will soon see major upgrading and the area will be pressured for rentals and developments.
Consider investing your money in such an area if you want to NG and you may get a quick capital gain.
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