Linda3

This not an easy one to answer. Some lenders will consider lending 95% but it really depends on the borrowers situation. If the lender is taking a higher risk on the security (i.e. by lending 95%) side of things then they will want to mitigate that risk on the serviceability side of things (i.e. you need to be able to easily be able to…[Read more]

Hi Caz

Try and hang onto it (only if you are reasonably sure that there will be some capital growth in the short-term). However, if you are unsure about capital growth then I would sell.

$4,000 is not that much in the scheme of things. Maybe do some home based work. Get your de facto to assist the trades people in return for a lower cost of…[Read more]

I have got a client that owns 19 properties and her average yield is 11%. []
I would like to have her portfolio. []

I just takes a lot of pounding the pavement (for which I have little time at the moment []).

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au

Hi Tas

Any profits retained in a trust (i.e. not distributed) are taxed at the highest margin rate (i.e. 48.5%) as far as I’m aware.

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au

P.S. But there could be a different rule that I’m not aware of. Tax & Trusts is always changing and can be complex.

Wow Terry – I was one second late! []

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au

Hi Amni23

The bank will consider your net income (i.e. gross income less expenses) as this is the amount of money you’ll have free to be able to repay the debt. The bank may make adjustments for some items (depreciation, excessive superannuation contributions, abnormal items, etc.).

It sounds like the bank will use $8,000.

Cheers

Stu

Property…[Read more]

Hi Drewboy

I’ll have a crack (in the absence of anyone else).

1. 25% deposit for commercial – do you have this? If not then can use equity in your property @ 6%. Therefore net cash flow is $12,282 – $4,500 = $7,782. Commercials ok but you could probably get a residential at 10% yield. The good thing is the cost of debt for res. is much cheaper…[Read more]

Thanks Scott.

Just to clarify… when Scott says “bends over backwards” [] he means this metaphorically not physically! [] Sorry, Firday afternoon, long week… time for some humor.

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au

Terry – sub-sec 2 says if you use “part” of the dewelling for assessable income purposes… I checked my answer with the Master Tax Guide (but it has been known to be wrong before).

I’m email one of my tax nerd mates from KPMG and let you know.

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au

Actually you only get a partial CGT exemption. You have to pay CGT on the time this property was rented out (sec 118-145). Here’s an example:

quote:You Acquire a property on 8/4/1992 and use it as your main residence until 17/8/1994. On 18/8/1994 you start renting the property out. On 29/11/2001 you sell the property. The partial exemption is as…

[Read more]

Don’t mix business with pleasure.

If you have purchased this for investment purposes then all you really have to worry about (with in reason) is the numbers. Is sound like you really like the area (which is great) but don’t let your emotions affect your investment decisions.

If the capital growth is good or if the rental yield is high then it…[Read more]

Caeryla

I would also check out:

– Streets Ahead by Monique & Richard Wakelin
– Real Estate Riches by Dr Dolf De Roos

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au

It’s all about rental yeild. If you buy a higher yield property your capacity will increase.

This will be addressed in my “unlimited finance” article – which I’m about half way through.

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au

Just on the covering your risks thing… each syndicate member could counter indemnify the other members for their share of the debt. This would give you legal recourse should one member not meet their obligations. You could put restrictive clauses in the syndicate agreement that perhaps states members lose their share of ownership if they default…[Read more]

Return to your investment objectives and time horizon when you purchased. Did you buy for the long term? If so, ignore the short term volatility. As a long term investment I think Southbank is good.

However, if you purchased for a quick capital gain… it’s not going to happen. Cut your losses.

Cheers

Stu

Property & Finance News
at…[Read more]

Hi Del

In short – yes, always better to divert all free cash flow to reduce non-deductible debt first. If you have a home loan then I would definately only repay interest only on IP loans.

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au

Maximus

Generally, the minimum P&I repayments (to apply after IO period) are already set out in the loan documents when you first take out the loan. So repaying principal will have no affect (but check with your loan docs).

Most lenders will let you roll over into another 5 or 10 year interest only period after the first one has expired. So you…[Read more]

Richmond – you already have an existing income stream so I would think it’s deductible. You may have to apportion between personal and investment (i.e. meals expenses, etc may not be deductible). This is a tricky area which I have not touched on for a couple of years (not until now when it’s become relevant again).

There is a defence that if a d…[Read more]

This is a complex area. There is no easy answer (depends on a lot of factors). I suggest you seek professional accounting advice. Plus you can also see http://law.ato.gov.au/atolaw/view.htm?docid=TXR/TR989/nat/ato/00001

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au

Thanks Terry… do you think I’m beautiful? []

Cheers

Stu

Property & Finance News
at http://www.prosolution.com.au