[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 8, 2010 - 8:40 am

Hi Stevo,

I've found Suncorp to be the least resistant. They will allow 95% plus full capitalisation of LMI (so effectively a 99% LVR).
Of the 4 majors Homeside (NAB) don't cap LMI…
The majors also have restrictions to the LVR they will allow you to go to (must be existing customer etc) whereas Suncorp don't.

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 8, 2010 - 5:35 am

Hi Kopano,

The unit size is a real killer and banks have come right back in terms of what they will offer on these apartment sizes. Does it have a separate bedroom?
I know depending on the valuation and strength of the overall deal then I'd be putting the deal up with St George but even then  they'd reduce the LVR…

Sorry I can't be of more assistance but the pledge might be the best way to get the 80% financing.

Good luck.

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 8, 2010 - 12:06 am

To echo Banker's statement, I haven't had a single low val for a client who has purchased in the last 12 months (perhaps this might be becuase they've all been in the Melbourne market). The only low vals I've seen have been for refinances or top-ups where some of my client's expectation may be a little too high…

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 6, 2010 - 5:03 am

keiko wrote:

Bloody valuers, I would Keep it with the same agent, she sounds like she will work hard for you to get this sold, the agent may be able to make the change to the other properties that she sold by logging onto RPData and making the changes, that is as long as they have sold and are not still under contract, (I think this is possible but not 100% sure)
Another option, pay $500 or whatever the cost in your area to do a valuation and then tell that valuer you think it is worth $650,000ish, and provide him with the evidnce of the other sales and why your apartment is better, and hope it comes in somewhere around $620,000 and then have your agent go back to the buyer and say look here is a new valuation,
that other valuer didn't know what he was doing etc

…as long as the buyer's bank uses that valuer and they accept it (if you have a subject to finance clause), which is why I ask who the bank/valuer are. Or you try and get an unconditional contract.

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 6, 2010 - 12:37 am

Hi Scotty,

Low vals are a massive pain and sometimes unfair considering what the market is doing.
I asked this question of a valuer in Melbourne as we had this happen with a client recently, and they said that as valuers are liable for incorrect valuations, they won't stick their neck out and give a valuation when they don't have the results on file. The default is to wait for the results to be posted by the Valuer General, who do this after securities transfer (at settlement), and the results can be several months old before the valuers use them.

So with regards to the other units selling at $585K & $642K, what the valuers will do is wait for that result to be posted officially, so the $642K technically may not exist to them just yet…

Some valuers use different data (from peak bodies such as the relevant real estate institutes or selling agents), but it still isn't 100% known.

Do you know who the lender/valuer was who performed the val?

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 3, 2010 - 4:08 am

Hi Matt,

You can redraw the funds (or refinance to release equity) to help towards the purchase of a new PPOR and turn your existing home into an IP, but as the purpose of the funds is to purchase a new PPOR, they are not tax deductible. All existing debt you currently have against your PPOR will be tax deductible once it is an IP.
A suggestion would be to place all excess funds into an offset account, which will also reduce the interest payable but keep the debt at existing levels and increase your deductions in the future.

However if you were to turn your future PPOR into an IP further in the future, the funds would then be tax deductible.

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 3, 2010 - 12:18 am

Good to hear these stories as it gives more people the courage to ask for what they want!

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 3, 2010 - 12:14 am

I had a family member who worked for the "Shire" council and they cracked down a few years back due to a lot of developers not following guidelines in Cronulla and local backlash, so might be worth considering a permit to save yourself the grief later! I saw a story recently of Gordon Tallis being fines for illegal removal of trees (although this was due to the neighbour)…

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 2, 2010 - 4:43 am

I love Carnegie and think it's an absolute gem of an area and if you can find a property within your budget is definitely worth going for. We've found a HEAP of competition for places in that area though so finding a bargain is very hard although we're seeing a slowdown of some sorts with auctions seeing some properties passed in (although this isn't for lack of demand but rather sellers who want too much).

Another aspect of Carnegie is the average family wage is higher than the Melbourne median as younger couples and families with dual incomes are moving into the area and that will also push up prices as they have more to spend than the traditional older demographic the suburb currently has.

Good luck with your search and if you need any help, we run seminars that you might find interesting in the areas of finding outperforming property and investment (just check our website).

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 1, 2010 - 11:51 pm

The discount should be for the life of the loan.
ANZ's Breakfree rate is 6.71% (0.7% disc) with no app fee and $375 annual fee.

Remember that Homeside is only the cheapest right now because they didn't go above the 0.25% RBA rise that the other majors did in December 2009, and we'd expect them to come back to rate parity eventually…

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 1, 2010 - 11:44 pm

When you say you have little super then perhaps proeprty could be a retuirement vehicle for you and you might want to consider buyng and holding rather than flicking for short term gains. Longer term capital appreciation might be a better option for you for wealth building. If you chose that route then my feeling is you'd get a stronger capital growth from anything with a little more land content and perhaps adding value by rennovating, build the equity and then use this for further purchases or upgrades. You just need to be able to service the debt in these times. If you decided to never sell these properties and live on the rent you also remove any GCT issues.

With regards to living at the folks and the lifestyle change, if you think you can get a better return with doing this it might be an option but I've had clients go stir crazy in a very short time!

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 1, 2010 - 5:27 am

In Melbourne I'd say 2-10km (I say 2km as I don't go into high density in the CBD) – and I do have a bias here as that's where I;m based…
Sydney a little further at 2-15km and CBD if water-side (high density is better if you have views). Apartments are generally ok as long as your views can't be built around or impeded. There is also a little more diversity within those inner city areas, but further than 15km might see lower capital growth. Depending on your budget and affordability, you might like to look at the inner north-west and even an apartment as long as you keep to less than 15 in the block (and get some land content).
No doubt there will be contrasting opinions and if you can find that apartment that can get you a better result, then go for it!

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 1, 2010 - 5:00 am

There are some quantity surveyors who will have a quick phone chat with you and determine if it is worth doing a depreciation report (as you'd be surpirsed just what you can claim!). They should do this call for free. It would be worth investigating as they are the experts and even accountants can miss items.
I'd suggest BMT quantity surveyors if you want to start with someone…

Do you have any outstanding loan against the property?

[LHParticipant@lhJoin Date: 2010Post Count: 97]

September 1, 2010 - 4:41 am

You can definitely turn your PPOR into an IP, perhaps you need a new broker!

I like a house over a unit (as long as you are not too far from CBD) as the land content is higher. Not sure why you think you'd get a higher capital gain from the unit…

[LHParticipant@lhJoin Date: 2010Post Count: 97]

August 31, 2010 - 3:40 am

You should only lose funds in the case of cooling off and not if the security fails a condition.

Always get a good conveyancer/lawyer to look it over as conditions must be very specific and you can only pull out of a contract subject to an item failing its provisions.

You can also get vendors who might dispute a condition if they feel it's not a deterrent. It can depend on the vendor but I've never seen this happen personally.

[LHParticipant@lhJoin Date: 2010Post Count: 97]

August 31, 2010 - 3:27 am

Hey P,

Good luck on your venture. Getting educated first is the best step.
This website is a wealth of info that will no doubt help.
We have newsletters and workshops that you might find useful at our website.

For your first IP, I'd suggest a low rate Interest only loan or perhaps a professional package that'll allow multiple properties (all uncrossed of course) under a single annual fee. From there you could get quite intricate but for a first step keep it simple.

[LHParticipant@lhJoin Date: 2010Post Count: 97]

August 31, 2010 - 2:42 am

Looking at a like for like – my preference is to buy existing and rent it out asap to get the rental income. Perhaps with some minor alterations so that I use as little cash as possible.
Building new will give you additional depreciation of the building and fittings which tax wise might be attractive.
Remember building will take time and you forgo any rental income in that time.

You might however find that developing an existing site with a duplex (or other) to increase rent further might be another reason to do so…

[LHParticipant@lhJoin Date: 2010Post Count: 97]

August 24, 2010 - 1:12 am

There are also considerations about multiple properties (last I checked), where the six years are cumulative across those you are claiming an exemption, so you'd only get six total years across them and CGT would be distributed proportionately.

Definitely worth getting some tax advice if you're looking at this type of strategy.

[LHParticipant@lhJoin Date: 2010Post Count: 97]

August 23, 2010 - 6:33 am

Good luck with your investing.

Firstly, as a mortgage broker, I'd always suggest coming and chatting with us first

Some of the questions you should ask a broker are:
* Will they give you full disclosure on their income they receive from servicing you
* What added value & Integrity do they have?
* If a broker represents any lender/s, they should:
      1. Provide clear reasons for recommending these products
      2. Disclose financial information so the borrower can assess any potential conflict of interest
* Do they exceed minimum qualifications?
* Do they practice what they preach?

When it comes to property investing, there are many different goals that will help you decide what you want to do:
*Are you after higher capital growth or a higher income yield (your desire to reduce your tax suggests negative gearing and therefore capital growth)?
*Do you want to add value to the property or simply buy and hold?
*Do you want to buy in the city or country?
*Do you want to get additional tax benefits through depreciation (helps determine older vs newer property)?
*What are your plans with the property long term?

If you live in the Melbourne area, I run workshops on first time investing that you might find useful. You can access the information for these from our website.

[LHParticipant@lhJoin Date: 2010Post Count: 97]

August 23, 2010 - 2:55 am

Your best first point of call is to speak with your accountant and let him know exactly what you want (with regard to tax deductability etc) and he will give you the expert advice in which is the best structure moving forward. They do this daily and it shouldn't be an issue at all. If it is, then source out a better accountant (there are many that post on this site).

You'd be surprised at how simple it is running a few accounts across multiple properties, it just takes time to adjust.

Best of luck!