[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 20, 2015 - 10:49 am

pree-vyet
If it is legal to rent out the granny flat you could rent out the main house instead. I have a friend who rents out his granny flat. He intends to move into it later in life and rent out the house.
Great idea which will bring a good income.

• This reply was modified 9 years, 1 month ago by  Catalyst.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 20, 2015 - 10:42 am

If you want to self manage you need to make sure you are aware of all the rules and regulations.

My only concern is tenant checks. Bad tenants target self managers as there aren’t often checks in place.

I think it’s fine if you have 1-2. It can get a bit onerous if you have multiple, but then again you are saving more on fees.

It depends on yourself as well. Are you able to distance yourself from tenants personal issues or will you get attached and feel you can’t put the rent up because they just had a huge electricity bill (for example). If you have a good tenant everything can be peachy. But what happens when things go south. Do you know the procedures to go to tribunal etc?

Sometimes it’s better to keep it business like. Personal decision.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 14, 2015 - 3:37 pm

What if (like your example) your tenant starts a fire and the whole complex burns down? If it’s intentional strata insurance will come after you. It’s not just your property. If your unit causes damage to other people units YOU are liable. eg the pipes (inside your unit) burst and destroy the unit below’s furniture). You are liable.

And the MAIN thing it covers (which I mentioned) is public liability (over $1M). If anyone gets injured or dies you lose everything. Worth the risk to save $350 a year? I don’t. I like to sleep at night. It’s only $1 a day. There are plenty of better ways to save $7 a week I think.

I have multiple properties and yes it adds up, but then again so does your rent and profit. I only have landlord on strata places. On others I only have building (as that covers public liability). Still only a few grand a year.

• This reply was modified 9 years, 1 month ago by  Catalyst.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 13, 2015 - 9:41 pm

Yes you are liable for insuring your property.

NO- It is NOT covered by Strata. Strata insurance is for building only. You need to insure everything inside the unit. If you or your tenant cause damage you are liable.

You are also liable if your tenant or a visitor injures themselves in your unit. The main reason I get landlord insurance is for the public liability. You risk losing EVERRYTHING if someone is injured or dies on your property.

Strata insurance only covers public liability on common ground (not IN your unit).

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 13, 2015 - 9:35 pm

Not too high but high compared to Western Sydney in the past.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 11, 2015 - 5:13 pm

Yes there are a lot of costs associated with property investing. When the costs are higher than the rent it’s a negatively geared property. You can claim the loss as a tax deduction.

If the property is near new or has had a major reno you will have good depreciation, which will lessen the costs out of your pocket.

Calculate carefully what the costs will be BEFORE you purchase anything. This is the reason 99% of property investors only own 1 property. Too many negatively geared properties drains your pockets very quickly.

By increasing your yield you won’t have as much drain on your pocket. You may be able to do this by renovating the property so you can put the rent up or put a granny flat in the backyard.

Keep reading and asking questions. There’s a lot to consider.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 9, 2015 - 10:56 pm

If it’s positively geared the rent covers ALL the costs.

Not the P&I though. Pay Interest Only.

If you need the extra tax you will be getting you can sign a tax variation form (used to be called 221D) and then you get your tax lowered each week instead of waiting until the end of the year.

Is that what you are asking?

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 9, 2015 - 10:51 pm

Why are you looking at those areas now? Vacancy rates are only part of your problem. Don’t get me wrong I love Western Sydney, and this boom has been kind to me.

We are at the peak of the boom. You are unlikely to get any capital growth for 10 years and may even get some negative growth in the next 5 years.

Not a good time to be buying there IMHO!

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 9, 2015 - 10:47 pm

Who told you this? The agent. HAHAHA!! Don’t trust anything they say.

IMPORTANT!!!! Is the verandah legal?? Is it passed by council? Is it legally enclosed (I doubt it)??

If the answer is No! No! No! Council will probably ask you to remove it altogether.

Doesn’t sound like a walk in the park to me.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

March 5, 2015 - 5:09 pm

Blackhotel I totally agree.

Jacqui makes some good points as to why.
I have a unit in a big block and notice one agent in the area continually advertises rents cheaper than standard. I’cve pulled them up on it when they try to get my business.

As Corey said- it’s not just agents. I bought a villa and went to the first strata meeting. Got chatting to a couple. I said mine was rented at $250 which was under market. I put the rent up to $285 straight away then up again the next year. They said theirs was rented at $235 as the tenant had been there a while. I said that’s crazy and throwing money away. After a little while they then said they had a 3 bedroom villa. Mine is only 2 bedroom. CRAZY!!! Why would you subsidize a strangers rent to the value of $70 a week!!!

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 26, 2015 - 10:44 pm

You’ve answered your own question in your last paragraph.

How many deductions are you willing to miss out on to save a few hundred dollars? It isn’t difficult to fill out the form but do you want to claim all you’re entitled to. I know I do.

The thing is “you don’t know what you don’t know”.

A good accountant is worth their weight in gold.

Do you know (or think you know) all the current laws and applicable deductions allowed on properties? What about next year, when things change? are you able to access the laws as they change.

I know I’ve got better things to do (like buying more properties). I can make more money doing that than sitting and trying to figure out if I’ve forgotten anything.

I thought I had a good accountant a few years ago then found out I missed thousands of dollars in deductions. Lucky the one I changed to could backdate the deductions.

So that’s my opinion (which you asked for) take it or leave it.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 25, 2015 - 11:47 pm

Have you checked the settings? Sometimes people set the temp lower but forget to switch it from heat to cool.

If it’s on heat, no matter how low the temp is, it won’t cool.

Try that then if no luck, ring the manufacturer/installer as mentioned above.

You don’t want them to come out only to discover there’s nothing wrong with it. They will charge you if that’s the case.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 25, 2015 - 4:57 pm

Do you have another home? If not you can use the 6 year rule in which case you won’t need to pay CGT if you rent it for up to 6 yrs.

If you do rent it for longer (or you are claiming another house as your PPOR I think it just goes pro rata.

I forget which is pro rate PPOR then IP or IP then PPOR?
Maybe someone else can clarify that.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 25, 2015 - 4:52 pm

It does seem strange. I would assume that if you give someone notice they will move out in the given time. That’s what usually happens.
Or do they know something we don’t ? You’ve got to wonder.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 25, 2015 - 7:42 am

Good point Bontham and if that is the case I would be walking. If there is not a lease in place you will have LOTS of trouble trying to evict.

Check to see if there is a lease in place and if it is rented through an agent.

If it is not then walk away. I nearly bought a property like this. I walked away. Took the guy who bought it months to get the tenant out.

Next . . .

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 24, 2015 - 10:20 am

He’s baulking at possibly losing $600? in 2 weeks rent.

Obviously doesn’t really need the sale. He has to give 30 days notice so they’d have to be pretty organised to be out before that time.

So he says they may leave early, then he says they may be there longer as they won’t have time to move out?? Maybe you din’t pay as high as he thinks he can get??

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 17, 2015 - 11:06 am

It depends on the bank. Some will not revalue under 6 months. They don’t believe it can change that much in that time. Uneducated that they are!!! One I did I bought for land value as it was fire damaged. We spent $25K on the reno and we could have sold it for at least $90K more than we paid for it.
I’ve not had to reval early as I had enough equity.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 17, 2015 - 10:53 am

Yes. It’s payable at the same time every year based on what you own at the time.

There can be exceptions, like if you’ve sold it but not settled.

You could ring them though to ask. I doubt you’d get a refund though. Do you have another PPOR you are claiming exemption on? Are you going to give them extra to pay for that?

• This reply was modified 9 years, 2 months ago by  Catalyst.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 15, 2015 - 9:06 am

I’ve spoken to a few people that have done the course. They say it was worth it but a LOT of work to find a deal. And you need cash (or a decent LOC) to maker deals.

Only met one person that actually did a deal but they were vague about it.

[CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404]

February 9, 2015 - 2:18 pm

Are talking about splitting the house and you occupying part and renting out the other part?

If that is the case you need to submit it to council and you will be required to put a fire wall between the 2 residences to make it legal. Without that, as you say, your insurance will wipe you. To install a second kitchen you should get council approval but just doing this will not make it legal to rent that part out separately. You may be able to have a relative stay in that part.

We have done this. PM if you want more details.