If you use your deposit it will be difficult to double it. You might end up with none for your settlement.
Also from a tax point of view you will have less deposit and therefore need to borrow more for the home and the interest on this would not be deductible.

Pass mark is generally what you said the property is worth, as well as there being no adverse issues such as being uninhabitable and/or high risk ratings.

1. could be exempt if you choose (optional)
2. If you choose to exempt the melb one

2. Any new main residence could be exempt.

I am a lawyer specialising in asset protection. I have half finished a book on the topic and am still finding out new things each day it is a very complex topic.

It is not as simple as setting up a discretionary trust. It is important how the trust is set up – who takes what roles, the terms of the trust – some ways to set up will achieve little asset protection and how you cause the trust to transact. Do it wrong and there will be little asset protection.

And before you set up a trust to own property in NSW you have to ask yourself if you are so worried about asset protection that you are willing to pay 1.6% pa in land tax each year?

It sounds like you are concerned about creditors in bankruptcy, but also consider other aspects such as asset protection in death. Trust owned assets cannot be willed at death so you have to carefully pass on control of the trust so it doesn’t fall into the wrong hands.

Benny wrote:

Hi Terry, In respect of this answer:-

2. depends. You will only be able to claim one of the houses as the main residence and get the exemption. So you would generally reassess things in a few years and see which one has grown the most.

I had previously heard that this “nomination of PPOR” can take place like you said – years after the fact, and you may choose which one to go for.
But then, in my own situation, I had the State Govt requesting I nominate my PPOR so that they knew which house to exempt for Land Tax. So where does that leave us in the above situation (where we want to “hold off nominating a PPOR”? Is there a way where we can satisfy both State and Fed while still holding off on the PPOR nomination?
Interested to hear the answer, and thanks in advance,
Benny

Land tax is a whole different situation. A house could be you main residence for CGT purposes (commonwealth law) but not for land tax purposes (state law) or vice versa.

Thats why you need specific advice, because you are only giving part of the story and these things are important. If you had legally borrowed from someone else first you could have set it up in such a way as to maximise tax deductions going forward, but you may have ruined your chances now.

kipper wrote:

If my husband buys a small apartment and rents it to me then can we tax deduct any loss?

I answered this above.

I didn’t doubt the story was true. I just doubt the benefit. Not my cup of tea

Part IVA of the 1936 ITAA would deny any deductions, but legally you could rent to him.

Debt recycling will be slow. Buying another property to sell at a later date may enable you to pay off the PPOR sooner. And you can do both buy and recycle.