There?s something with pensioners whereby their PPOR is exempt when calculating the pension amount. So you could live in a $3m house and still receive full pension. What is used to assess the pension is your income from other sources such as annuities, savings, etc. So my parents receive about a half pension, they don?t receive full pension.
They?ve toyed with the idea of doing a massive reno on their home to improve value and use their funds that way. The ?pro? of renovating the PPOR is it would make the resale value of their home better and diverts assessable funds so they?d receive a bigger pension, because the money would go into something that?s not income assessed (although I believe Abbott may be changing that???) Not so great for us coz we want to buy it! J
Terry ? yes, in an ideal world we could do a house swap. But none of our IPs are suitable for them to actually live in, as they are big homes or a TH with stairs?
We could just ?rent? the home off them once they had decided and moved?but I guess it depends what they do, they?d need funds to finance purchase of another PPOR .
The basic garden variety approach is a straight sale: we agree on a price, we sell 2 IPs, pay out loans (or do term deposits), and buy their place.
They can then rent it off us til they are ready to move (ie they just pay interest on mortgage).
I guess I?m looking if there is a more financially savvy way. Because, as Terry said, so much is lost in the transaction. If they had had their home in a Discretionary trust, could they have just ?transferred? the house to us?