I have recently read 0 to 130 and have been motivated to now take control of my life – thank you.
This is a question for Steve – you mentioned in your book that you purchased a country hotel and it just so happens that I have come accross one that has some initial interest. Was this a successful purchase for you? Do you have any advice on what to look out for with this type of purchase?
Also, what is your view of commercial property purchase vs residential. It seems to me that commercial property can offer better returns with less hassle (providing homework is done of course).
Thanks.
Beryl
Commerical properties are fine, except you must keep in mind the GST issues.
Prior to purchasing you need to apply for an ABN, and then consider buying the property as a going concern, which means that you will not have the pay the GST upfront.
Also you would have to lodge (quarterly) Business Activity Statements.
If your “commercial property” income does not excede 52k gross per year you dont need to register for GST. Speak to an accountant.
Commercial investing requires significant research .
Yes the cash flow can be good but I think 11 sec rule may not apply.
Also commercial interest rates are typicaly higher.
In my opinion it is good to have a commecial property in the portfollio.MJK
MJK
Yes, you are correct that, do not have to not have to register for GST if your rent are less than $50,000 per annum.
But if you did that, it would be very costly if you didn’t register for GST, as you would not be able to claim the GST on the purchase of the property.
To be able to claim the GST on purchase or use the going concern exemption the purchaser must be registered for GST.
So I strongly advise any investors who are going to purchase a commerical property to register for an ABN and GST.
DC
[
]Like any property investment, real good deals in Commercial also come along. We bought a commercial property approx 15 mths ago for $155,000, as a going concern, therefore paid no GST up front. (We stayed registered for GST for only one year, so no longer have to submit 3 monthly GST reports).
After spending $23,000 on the retail outlet we received $420.00/ week in rent. We then constructed a commercial workshop at the rear at a cost of $65,000 and will rent that for $150.00/week. Our next project is to turn the scungy upstairs flats into bright/light studio appartment and rent them for $100 each/week. Cost to do each appartment is $20,000. For a total outlay of $283,000 we will receive $781.00/week. As this is part of our self managed super fund it is not mortgaged.
The income from the property is invested into shares.are there any thoughts on investing in commercial property in Melbourne CDB. Is now a good or bad time to consider this
DC,
Absolutly correct about registering if you want to claim back purchase price GST.
If the purchase is subject to GST registering is the only way to go.
It is possible to buy property that is not subject to GST though albeit rare.MJK
]Like any property investment, real good deals in Commercial also come along. We bought a commercial property approx 15 mths ago for $155,000, as a going concern, therefore paid no GST up front. (We stayed registered for GST for only one year, so no longer have to submit 3 monthly GST reports).
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