Different strategies have different cashflows.
Your strategy is one where your reward will come when you develop the blocks, but holding costs and expenses in the meantime will be higher.
Not worth investing in property
- Thread starter Hodge
- Start date
Different strategies have different cashflows.
Your strategy is one where your reward will come when you develop the blocks, but holding costs and expenses in the meantime will be higher.
Spread amongst the states, and/or more units / townhouses.
That's OK, we are all allowed to be wrong once in a while.
I see the others posted at the same time as I was typing.
Hey Hodge
I feel your pain.
I have a few IPs in the ACT - the land tax is around the $2k mark for each.
It's all about the numbers. If the numbers still stack up after you've taken into account all costs - then all good. You've also got blocks that are ripe for future development
Five years in the world of property investing isn't long. Hang in there
Cheers
Jamie
I feel your pain.
I have a few IPs in the ACT - the land tax is around the $2k mark for each.
It's all about the numbers. If the numbers still stack up after you've taken into account all costs - then all good. You've also got blocks that are ripe for future development
Five years in the world of property investing isn't long. Hang in there
Cheers
Jamie
But you knew you had to pay this tax when you bought.... so it should've factored in?
In our case, land tax wasn't an issue for many years. Once UCV goes through the roof, suddenly land tax raises its ugly head.
Moving properties into another entity is one way of getting around it. This will cost money but the savings can make it worth investigating.
Moving to another entity or into wife's name will mean paying capital gains tax and transfer duty, but capital gains tax base figure is then reset for the wife, and transfer duty might be worth paying once in order to save thousands per year. In two or three years, you could be ahead.
Yes land tax is not new to me and money isn't the problem. I just feel lately what ever you do to make a dollar big brother wants his cut.
You sound just like we were about a decade ago Hodge, plenty of residential houses on big blocks, with Tenants paying bugger all rent and Land Tax bills coming in that were sometimes more than what the Tenants paid in rent.
Simply sitting there waiting for the equity fairy to take a big dump. Not much of a strategy - huh !!
We solved the problem back in early 2004 by vowing never to purchase another property again unless the Tenant paid the Land Tax for us.
When searching for something to buy, in your research if you find out the Tenant aren't prepared to, or as is more commonly the case aren't allowed to pay the Land Tax, then no worries, move on and buy something where they are allowed to and are forced to.
Works OK for us.
Simply sitting there waiting for the equity fairy to take a big dump. Not much of a strategy - huh !!
We solved the problem back in early 2004 by vowing never to purchase another property again unless the Tenant paid the Land Tax for us.
When searching for something to buy, in your research if you find out the Tenant aren't prepared to, or as is more commonly the case aren't allowed to pay the Land Tax, then no worries, move on and buy something where they are allowed to and are forced to.
Works OK for us.
Can you change your strategy now, instead of holding start developing now?
This is the strategy I am using to generate cash flow and profit on sale while accumulating property.
I think it is a mugs game holding property that does not generate income while waiting for "the equity fairy... I like that term.
This is the strategy I am using to generate cash flow and profit on sale while accumulating property.
I think it is a mugs game holding property that does not generate income while waiting for "the equity fairy
... I like that term.
Once upon a time, a powerful wizard, who wanted to destroy an entire kingdom, placed a magic potion in the well from which the inhabitants drank. Whoever drank that water would go mad.
The following morning, the whole population drank from the well and they all went mad, apart from the king and his family, who had a well set aside for them alone, which the magician had not managed to poison. The king was worried and tried to control the population by issuing a series of edicts governing security and public health. The policemen and the inspectors, however, had also drunk the poisoned water, and they thought the king's decisions were absurd and resolved to take notice of them.
When the inhabitants of the kingdom heard these decrees, they became convinced that the king had gone mad and was now giving nonsensical orders. They marched on the castle and called for his abdication.
In despair the king prepared to step down from the throne, but the queen stopped him, saying: Let us go and drink from the communal well of madness. Then we will be the same as them.
And that was what they did: The king and queen drank the water of madness and immediately began talking nonsense. Their subjects repented at once; now that the king was displaying such 'wisdom', why not allow him to rule the country?
The country continued to live in peace, although its inhabitants behaved very differently from those of its neighbors. And the king was able to govern until the end of his days.
The following morning, the whole population drank from the well and they all went mad, apart from the king and his family, who had a well set aside for them alone, which the magician had not managed to poison. The king was worried and tried to control the population by issuing a series of edicts governing security and public health. The policemen and the inspectors, however, had also drunk the poisoned water, and they thought the king's decisions were absurd and resolved to take notice of them.
When the inhabitants of the kingdom heard these decrees, they became convinced that the king had gone mad and was now giving nonsensical orders. They marched on the castle and called for his abdication.
In despair the king prepared to step down from the throne, but the queen stopped him, saying: Let us go and drink from the communal well of madness. Then we will be the same as them.
And that was what they did: The king and queen drank the water of madness and immediately began talking nonsense. Their subjects repented at once; now that the king was displaying such 'wisdom', why not allow him to rule the country?
The country continued to live in peace, although its inhabitants behaved very differently from those of its neighbors. And the king was able to govern until the end of his days.
Same. I have development sites that I want to start developing this year. While I have seen some amazing equity build up in those sites, I never bought them with the intention of waiting for "the equity fairy". It has always been my intention to develop them.I think it is a mugs game holding property that does not generate income while waiting for "the equity fairy
As mentioned above by MTR can you start developing the properties which should increase both your equity/cash and rent/cashflow.
Then going forward look to continue what you're doing but diversify into other states.
Or as mentioned maybe change strategy once developed and sold... CIP? Shares?
Then going forward look to continue what you're doing but diversify into other states.
Or as mentioned maybe change strategy once developed and sold... CIP? Shares?
Hey Hodgie I share your pain, welcome to my world etc etc! But Alexlee is right I think you got out of bed the wrong side as you were probably paying Land Tax before this assessment??($7.5K); anyway next time you buy make it commercial or industrial & the tenant pays it all with the right lease!
blue sky tomoz!
blue sky tomoz!
Wow.. how much is the land component for $2m portfolio?
I have a block (with a motel on it) on NSW north coast valued by the OSR at $1.203M & land tax for 2014 is $12.761K p.a. ; as I believe they have undervalued it substantially ( bit like a bank val. on a house compared to current market value) so I am staying schtum??(excuse that spelling if wrong)
; as I believe they have undervalued it substantially ( bit like a bank val. on a house compared to current market value) so I am staying schtum??(excuse that spelling if wrong)My land taxe just in NSW was 7.8k......I am not happy but tolerate it as some of my places have gone up 180k in 4 years.
Will look to sell some of my places at the peak in NSW. ...
The land taxes in other states are about $1k!
So ...consider it good if you properties are going up faster than land tax!
Will look to sell some of my places at the peak in NSW. ...
The land taxes in other states are about $1k!
So ...consider it good if you properties are going up faster than land tax!
