zachhogMember@zachhogPost count: 1
3 1/2 years ago my wife and i bought our first family home for $28000 and it now worth $200000 minimum if we were to sell and can be rented out at $500 per week.
If i rent it for 12 months then sell do i have to pay capital gains tax? Or should i sell and use the money to reinvest?DerekMember@DerekPost count: 3,544
Given that the property was your PPOR you can rent it out for up to 6 years without incurring any capital gains tax, provided you do not declare another PPOR during this period of time.
Whether you sell or not is entirely up to you. As it currently stands, and based on the information provided, it would seem that this property provides you with both equity and cashflow that could be invaluable to your next investments.
Therefore I would suggest, under normal circumstances, this is a ‘hold’ and use
this property as a cornerstone for other purchases.Don NicolussiParticipant@donPost count: 1,085
These numbers are pretty fantastic. Derek is spot on as usual. You have a chance to have the best of both worlds.
My 2 cents. Don’t sell until you have a plan/alternative use for the funds.
If your numbers are accurate you could always fund the new investment with an equity product while you place the property on the market.
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Email to receive current dealsMabbottMember@MabbottPost count: 35
If my PPoR cost that little and was somewhere i was happy to live i too would stay and use the equity to build a portfolio..
What area is your home in??
still don’t know what i don’t knowMortgage HunterParticipant@Mortgage-HunterPost count: 3,781
You can access the equity without selling.
My regret over an investing life is that I have sold properties.
If I had never sold I would be better off now and quite significantly so.
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Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.AUSPROPParticipant@AUSPROPPost count: 953
Simon I too hold similar regrets. However, will this trend continue into the future? every man and his dog including the UN and Madonna seems to think Australia has had an extreme period of house price inflation. Imagine neg gearing in a steady or declning market i.e. losing money on a weekly basis on an asset deflating in real terms.
more facts are required re this situation. Zachhog where are you planning to live whilst you rent this out and at weekly rent? Or are you plannign to buy? and congrats on a huge tax free gain!!!
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