advice needed again.

[trey]

Hi all

Question number 1. can anyone recommend a property and tax accountant in newcastle that i can see face to face that will help structure my plan?

My plan

I have just purchased house it is IMO in one of the best streets in Newcastle on a corner block. there a many options i can build two brand new houses, renovate the old house, build granny flats etc.

I Want to renovate the old house and it will be my PPOR.

i owe 450k on the mortage and i want to spend the next two years working away and hopefully pay around 2500k a week into an offset account.

maybe down the track i will want to sell it but not for ten years at least.

im looking to get advice if i should rent the house out properly through a real estate for the next two years or i keep the smallest room and rent two rooms out for cash and use that money for renos?.

the other question is i have a double garage and i was going to build a wall down the middle to store or the buliding materials i will be getting over the next two years for the renos (my dads a builder). would the real estate have a problem if i was renting my house out but still able to access one half of the garage?

 

[trey]

for the next two years i will be doing fifo work so never there.

 

[tomlemke]

what street is the best in newcastle?

 

[DaveM]

Id wager its somewhere in windale

 

[Scott No Mates]

Merewether Heights? Bar Beach?

Unless you need a base in Newcastle, do you need to keep a room at all? Consider partitioning the garage to store your own stuff.

Have you already made this your ppor? If so, you may be able to get the 6 yr cgt ppor exemption but may need to watch out for land tax.

 

[trey]

Id wager its somewhere in windale

Your close.
@scott no mates
Does any know someone to recommend thanks? Im looking to buy another place now ip only in newcastle city. @scott no mates its still be settled but im going to renovate it and live in but for the next two years I have no need to be there. I just need half the garage to put all the materials ill be getting to renovate it. Ad I have no wherw else to put it.

 

[trey]

Need to re phrase def not the best street in newcastle just imo its a good street.

 

[bigdealbaby]

Need to re phrase def not the best street in newcastle just imo its a good street.

Hey mate,

I think the re phrase was a good idea haha, I couldn't work out how you got a corner block on the new street in newy for 450K!

Anyways, I am only a newbie to property investing but my dad has been pretty successful and has used Farrow Wyatt chartered accountants in Maitland for a long time and can't speak about them highly enough. They recently merged with another company though and are now called Pitcher Partners.

Best of luck.

 

[albanga]

Hey Trey,
Just focusing on your question there are a few key points to consider.

Firstly I would never suggest being your own property manager. Hire an expert and let them do it for you, a good one is worth their fee ten fold. Also remember the management fees are tax deductible.
Personally I really dislike the idea of keeping a room and then renting out 2 others. I see far less stability in this structure and just more issues. You also mention cash. Do you mean as in not declaring the income to the ATO? If so then this is illegal! You must declare this income but in doing so you get s range of benefits as well. Do not just think about "saving tax". Speak to an expert as to why this is a very bad idea.

Regarding the garage then if you use a REA and rent to say a family then I imagine it could be written into the contract but is not ideal. Think about yourself for a moment, if you were renting would you want the owner coming over willie nilly opening your garage door and dropping stuff off? If it had a seperate door then maybe not as big a deal but same door. What happens if they have a dog they put in the garage? You open door and it runs off. What about a baby and your banging away dropping things. I am not saying no it could not be done but I personally would not rent a place like this and if I did then I would want a reduced rentsl payment.

Secondly it is a good idea to put money into the offset but only if you have no deductible debt. So given you have no PPOR then I would first pay off any car loan, personal loan, credit cards. Then after that put into offset.

 

[trey]

@big deal baby thats what my mortage is not what the house cost! thanks for the recommendation.

@ALbanga thanks for your info.

There is a double garage so two accesible garage doors. i was thinking i could build a wall down the middle and only be able to access one side and leave the other side for tenants it is away from the house and wont be a disruption but yeah i understand what your saying. only because i need somewhere to store all the materials. i have no other debts.

I have no plan to be there for two years and def want to rent it and convert from IP TO PPOR but just want to sort it out the best for cgt tax and land taxs if i ever want to sell which ten years down the track i might.

i have no need for a house yet i can still live with my parents if i wont i mainly bought it for something to work towards as i was losing motivation and i know i will be able to add value through renovation or subdivision and one day will wont to live there.