Living in your investment property to avoid CGT while renovating

If your into the renovating side of things when your buying investment properties. Would living in the property for 3 to 6 months while your renovating prevent you from paying any CGT if you sold within 6 years.?
Then Once renovation is finished then you move on to the next buy and start renovating. Not a very comfy life style always on the move, but this would allow you to keep your full time job and do this on the side, and being able to sell without CGT could give you big profits?

is this correct?

cheers
 
If you are going to keep the first one you can't do it with the second one. You can only claim on PPOR at a time.

I know a single guy that buys a house, lives in it for a while then sells it and buys another using this strategy. As long as you don't do it often enough to attract attention.
 
If you are going to keep the first one you can't do it with the second one. You can only claim on PPOR at a time.

I know a single guy that buys a house, lives in it for a while then sells it and buys another using this strategy. As long as you don't do it often enough to attract attention.

Pretty much what he/she said ^^

Would be able to do it to ONE property.

Regards
Michael
 
oh yeah thats right you can only claim the CGT exemption if its your PPOR, so even if you had lived in all your IP's you could only claim it on one.

Na wouldnt be a proper business, just thought it might have been a good way to make more money by saving on CGT when you wanted to sell

Thanks for the replies
 
It is possible and there is no legal definition of "too often". Think about how your parents moved up the property ladder. All the single guy in the example is doing is compressing what most people regard as reasonable time. So he can claim the property as his PPOR. However, given that stamp & costs are involved it is a risky strategy if the market goes south and he needs to move on.
 
It is possible and there is no legal definition of "too often". Think about how your parents moved up the property ladder. All the single guy in the example is doing is compressing what most people regard as reasonable time. So he can claim the property as his PPOR. However, given that stamp & costs are involved it is a risky strategy if the market goes south and he needs to move on.

There might be a grey area about "too often" but I do believe that the ATO can decide that you are doing this as a business. I have no idea how they do that though. Does anybody know?

I like this idea, but no way would I do it with a family. I'd rather do it to high end properties, one every couple of years, but I agree about the entry and exit costs eating up a fair bit. You'd need to make a good profit to make it worth the hassle of living through it over and over again.
 
Yeah but people buy/reno and sell properties all the time AND pay CGT so it's not prohibitive. You just need to know your market and how to renovate and keep to budget.
 
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