It may have beneificial tax beenfits are you could claim it as your main residence while renting it out for a period of up to 6 years, as long as you do not claim any other property as your main residence.

Terryw
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Why not just use a trust?

Terryw
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The later. It can’t be in the trusts name as it is not a legal entity.

Terryw
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Yes, rates are not locked in until settlement, unless you pay that fee!1

Terryw
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Wouldn’t all savings accounts, including offsets, have GDT (if applicable in your state)?

Terryw
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Yes some people have done this, but it is hard to get a personal loan, and even harder to get a second. If you do manage to get the personal loan, then you have to demonstrate serviceability based on both loans. Personal loans are shorter terms, so the repayments will be high, which will hurt serviceability.

Terryw
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I agree with GP. eg. if a tenant had an accident in one of the properties and sued the owner, the trust(ee). all the assets in that trust then would be at risk.

Terryw
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Try a good solicitor.

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Apparently you have to be careful in SA on how you structure your LOs, otherwise they too could be illegal. ie if they look too much like a wrap, with a decreasing strike price looking like a PI loan etc. So please talk to a good lawyer.

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Sales contracts vary state to state. I think you should be able to pick one up fairly easy. Try asking an agent for a copy of one, or try the real estate institute in your state.

Terryw
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It may not be tax effective to keep it. Do you have a loan on your new home? If so, then it may be better to sell, to your trust, and put the proceeds off the new loan. you will be up for stamp duty on the sale to your trust.

Terryw
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What are the growth prospects?

If the area remains flat, then there is no point in investing.

Terryw
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You have to save up the next deposit and/or wait for growth to build up equity.

Terryw
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I am not sure why you would want to sell a Sydney property to buy possibly inferior cashflow poisitve property. You will probably end up making more money on the Sydney property on the gains. I sold a Sydney property to go cashflow, and regret it now.

You will also have to factor in the CGT you would have to pay, which could be huge.

What about…[Read more]

Hi

ANZ have no limit on the number of or timing of valuations. I have just done one where the client has done a revaluation one day after settlement – with nothing done to the property – for a 30% increase.

Terryw
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I have one on one of my properties. What did you want to know? They can get messy if not used properly.

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I have seen a few people get all reved up and form syndicates with their friends. off the top of my head, can’t say I’ve seen anyone do more than 1 property. It seems the enthusiasm gradually dies off in one or more members and one person ends up doing all the work and then gets fed up.

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I haven’t looked into the financing of these, but beleive major lenders won’t touch them because they are specialised security. They would be very hard to sell, so if anything went wrong, the bank may have trouble getting back their money. There may also be probelms with the bank forcing out old residents if they have to forclose, ie public…[Read more]

I too would start diversifying.

In addition to generally being rather dangerous, this will have effects in the future on financing, if your lender suddenly decides that you have too many properties there, they could limit your LVRs reducing the amount of equity available to be withdraw, etc.

Terryw
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Yes it maybe, if you properly document everything and work out an exit plan if one or more of your partners wants out.

Terryw
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