Family Trust

[Greb]

Greetings to everyone! Thank you for helping a newbie to the world of real estate investment. I am excited!! I have learned so much from what I have read so far and I reserve the right to ask stupid questions for awhile . First one: I am thinking of doing all my investing through a family trust I have set up. Is there any reason not to and are there any benefits I might not know about? I am in South Australia and would appreciate advice on best localities and purchasing positively geared properties. If I buy in Davoren Park, for example, and the tenants wreck the place when they leave, how many times will my proeprty insurers fix the place up?
Regards, Greb

 

[Brojac]

Why buy through a family Trust? Do you need to do this or is it just because it is in vogue at the present time?

Insurers are a bit annoying in this respect. You spend money to protect your self and then when you need this protection they crack the poops and put the fee's up, try and not pay and/or give you new conditions.

In short it depends on the company. Would you live in a dog box? What sort of tenants do you think you will find? Dogs!

Regards
Brojac

 

[Aceyducey]

Greb,

Family Trusts are useful for managing tax, protecting assets & proofing investments against family disputes.

That said, there are people who've never used one & have been very successful purchasing IPs - using your own name can be effective if you are following a negative-gearing path & have a high salary.

I suggest you get hold of a few books on Trusts to explain the benefits & disadvantages. 'Trust Magic' is one good one recommended on this forum (though I haven't read it myself) and there are a few good docs at the site: www.taxlegal.com.au - particularly 'Trusts in Structuring' and a good doc at www.chrisbatten.com.au 'Save over $100K by acquiring a rental property in a trust instead of your own name'.

Cheers,

Aceyducey