Renting out a room and FHOG.

Hi everyone,

My partner and I finally move into our first place in January. Anyway, we are planning on doing some renovations and that to get the place up to scratch. We have been considering what options we have to help us reduce some debt we have faster.

We are seriously thinking about renting out a room in the house to help our with our plans, there is a hospital a 2 minute walk away so we were hoping we might be able to get someone who works there.

Is renting out a room while having to satisfy FHOG work? Or are there implications because we are recieving money, or do you just keep this sort of stuff 'off the books'?

Renting a room has no impact on FHOG eligibility. It can have impacts on Capital gains tax for your PPOR, but I think these are more than offset by being able to negative gear, and boost your cashflow in the short term. Have a look at your local state revenue office FAQ section on their website for FHOG information.