talk to an accountant for exact numbers but basically:Purchase cost plus any costs to strata = total /6 for price per uniteg price per unit = $300Ksell for $330KThen your profit per unit is $30 K. Depending on how long you held them (>12 months 50% CGT reduction) and what your current tax rate is will dictate your final tax bill.Unfortunately you…[Read more]

"You missed the boom" said the locals"Coal prices will fall and the mines will put people off""I wouldnt buy in a small mine town""too risky"Well the place I bought in November just exchanged. Bought $252K, rent $460pw, paint reno and garden tidyup ($2200), increased rent to $490. Has potential to put in  granny flat and increase yield. Sold for…[Read more]

"You missed the boom" said the locals"Coal prices will fall and the mines will put people off""I wouldnt buy in a small mine town""too risky"Well the place I bought in November just exchanged. Bought $252K, rent $460pw, paint reno and garden tidyup ($2200), increased rent to $490. Has potential to put in  granny flat and increase yield. Sold for…[Read more]

Dont forget that you are allowed to classify you current PPOR as such for up to 6 years after you move out and it becomes a rental, PROVIDED you dont buy another PPOR in that time. If you rent then sell your PPOR would not be subject to CGT if it was in that 6 years. As always, check with your accountant.Mick

If you are certain that the lower area is not classified as "habital" as per  Scotts infom then may I suggest it allows a bargining point for you. If it is advertised using those rooms and thus impacts the sale price, can you offer less based on that not being legit?Never know unless you try, because if you dont ansk and buy, when you sell…[Read more]

you do realise you are posting on an Australian website dont you?

Hi Eh,In my circumstances I pay down the PPOR, as that forms the basis of my strategy. Not to say this suits everyone, it just suits me. If I was repeating it with an IP in place of the PPOR then I would run it with an offset.Mick

Hi Kate,With regard to the pic you posted, what is your estimated value of this one and it your property on a simialar size block?Mick

Hi Angela,Double check….did you WITHDRAW the equity (ie increase the loan amount) or did you CROSS SECURITISE (ie not increase the loan on now rental , but secure the purchase of new PPOR against is equity)?If you dont recall the loan amount increasing then perhaps you have both properties secured together. Either way, the interest you can claim…[Read more]

Me personally, I run my PPOR on IO the same as my IPs. The logic – it allows me the extra cashflow to fund the deals that I sell and I am able to then dump the profit onto the PPOR loan. Part of my goals is for a debt free PPOR by the end of next year. If I paid P&I and had not run the developments, I would not be as far ahead. All depends on what…[Read more]

my understanding1. you are required to live in it as PPOR for AT LEAST 6 months within the first 12 months. google FHOG for clarification)2. If you rent out whilst living in it at the same time you can only proportionally claim deductions (ie if she uses 50% of the house then can claim 50 % of costs) – although it would be woth asking if the rent…[Read more]

Check with the council in your area PRIOR to submitting an offer on their "boarding house" rules. If you exceed a certain number of warm bodies that are unrelated in a house then it falls under the boarding house catagory and there are different fire codes etc that you will have to meet, particularly if you are in QLD (which was overhauled after…[Read more]

Out of curiosity, why will you have the costs of selling reimbursed until 08/09? And what is a realistic sales figure in the present market?Mick

As mentioned above, check out the mining towns in Qld. I have properties in Gladstone, Moura, Biloela and Baralaba, all purchased in the last 6 months, all +ve cashflow, and all with that "potential" to be improved (ie 2 will subdivide, 1 will go dual occ and the other 2 will be reno'd).  All multiple industry, multiple mine towns so not entirely…[Read more]

Make sure you insurance is up to date as you will have a higher risk of "runners" and those who are just vindictive and damage things. Not to say this will occur, some tennants in the lower socio areas are more reliable than in other areas, just some are not!Mick

I see your point D.Personally when I determine yield it is AFTER all costs, not prior. However, this is not restricted to the rental guarentors, I think the magority of %yields being promoted by REAs in their listings are expressed simply as per annum rent/purchase price*100. It is up to the buyer to evaluate the rest. MIck

isnt there a clause that indicates if either party dies the contract can be voided? If so, and you reno, what security do you have that the property will indeed settle?Mick

I have bought in the Banana Shire, largest underground mine to go online soon. Prices have increase significantly since my purchase. New infrastructure going in, all looks positive for a while yet. I dont believe the mines would spend this amount on infrastructure without a good reason.Mick

I recall reading that this was something that the ATO was aware of and there was a ruling against it. I am trying to recall where I read it and I think it was on the BANTACS website. I am sorry I cant be more specific. I think the reason was you were in a more tax advantageous position by being able to claim all deductions but not pay tax on gains…[Read more]

Also, I as under the impression that you would also be considered a currency trader and as such may need to pay tax on any profit earned as a result of the exchange rate, even if the property itself has not been sold and realised.Mick