All Topics / Creative Investing / purchase vacant land, build houseand movein; lease out the current house for renting?
Hi,
I have my primary home which i want to rent it out after building on the vacant land my new home, The question is can i use my existing home as my investment property?
thanks
-GauravYes, why not!
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
Hi gaurav6,
Yes, of course. It’s a good idea. Investing is also one way of preparing for your future!
All the best,
Elea
Thanks Terryw & Elea!
The question is how should i go about the loan?.
I have current home loan with westpac which i have almost paid off. Now i need a bigger home which i intend to build which is going to cost me 450k. The current primary loan i can top-up to 200k, however i think i need to create another investment loan!
The scenario is i want to build my second home from some loan (either existing load or new loan) then move out of my current primary home to new home; having said that i want to rent out my first home say $250-280/week; Now how do i claim tax returns on Interest, etc and moreover how will the loan be called and on which house should the loan be????
I checked with the westpac the manager said she can arrage the loan however i want? top-up on exsisting, new load etc..
Please guide me as the case is not straight forward, i have to move to a bigger house which will be a new home, and rent out the old(current) house; while not loosing on tax returns…
Kind Regards.
-GauravLooks like you have dug yourself into a bit of a hole.
You cannot withdraw from the existing loan or borrow for the new home and have it deductible because you will be living in it.
If only you had used an IO loan with a 100% offset account.
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 Terryw,
What is IO loan with a 100% offset, can the current loan be converted into one.The current loan is variable home loan premium. I can do one thing i can first buy the land and then after 2 years build the new home with new loan.
Regards,
-Gauravtoo late now. You have already paid the loan down. Any withdrawals now will be new borrowings and the deductibility will depend on what the funds are used for.
It may work out better for you to sell house 1 and then pay down (or better into the offset account on an Interest Only loans (IO)) and then later go and borrow to buy a new investment property.
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 heaps Terryw !
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