Would you buy a IP in the ACT????

[hotproperty]

Hello again,

My husband and l are looking to purchase a IP in Narrabundah ACT, would you purchase a house in this area?

We are looking at holding onto it for a number of years, we hope to live in it for the first year then rent it out.

Does anyone on the forum own a IP in Narrabundah?

Advice would be great.

Thanks

 

[geoffw]

There's two parts to Narrabundah, one which has a bad reputation, and one which has not.

A few years ago, we had the chance to buy a place in the bad part of Narra. We turned it down, and later regretted it.

But here's another question.

Why live in it now, and rent it out later?

If you buy an IP in the ACT, the stamp duty is completely deductible in the year you buy it. That's because it's stamp duty on a leasehold, not on a freehold.

But you pay land tax on an IP, and not on a PPOR.

You could save yourself many thousands of dollars by letting it out for one year, and claiming the stamp duty exemption, and moving in after twelve months.

And if that advice is correct, you could use a paltry few of those dollars to buy me a beer

 

[HeXa]

guessing a FHOG purchase?

geoffw is right about the suburb... thankfully a drive by will give you a good indicator of the immediate neighbourhood Watch for the mattresses in the front yard and various rusting car bodies.

If and when the remainder of the suburb gets cleaned up, it would be a very nice and conveniently located. Until then... personally I have been looking elsewhere and spending the extra money.

 

[TheCamel]

hotproperty: depending on what you want, i'm tipping page/scullin/higgins/holt.

 

[FrankGrimes]

If you buy an IP in the ACT, the stamp duty is completely deductible in the year you buy it. That's because it's stamp duty on a leasehold, not on a freehold.

Thats interesting Geoff. Never knew that. Is the leasehold for 100 years or so?

 

[phil]

I like Harrison, but downside is a high entry cost. (although they do have cheaper town-houses also)

Phil.

 

[geoffw]

Thats interesting Geoff. Never knew that. Is the leasehold for 100 years or so?

I believe the original lease is 99 years. Which means that there may only be 40-50 years in some of the older areas.

I'm not quite sure what is happening with renewals- I have a vague memory that they were being renewed.

The main point of a lease is that they have ultimate control- not necessarily to evict (which would be a disaster if they ever tried), but to enforce planning regulations much more strongly.

 

[Adlante]

I heard, (hopefully correctly) One thing to be wary of about Investing in Canberra, is that if the governments change, all of the public servents could be relocated out of Canberra, not providing that demand that drives the market. (quite allot of public servents drive the Canberra scene.) I think it may have happened in the 90's maybe? I was only in my early teens back then, and didn't give 2 hoots about property prices, so I cant comment on it. Im interested in other peoples opinions on this......?

 

[geoffw]

There have been periods of government cutbacks which have severely affected the local economy.

However, I believe the Canberra economy has become much less dependant on the public service. The last time there were sever cutbacks, there was very little affect on housing prices- unlike some previous cutbacks, which left prices in the doldrums for years.

It has been the labour governments which have traditionally increased the public service; and John Howard only lives in the Lodge when parliament is in session.

A lot of the increases in spending in recent years have been for the security agencies, including the AFP.

I would not be surprised to see more decentralisation in an attempt to recruit more personnel, but I suspect there's too much infrastructure to try to relocate existing depertments away from Canberra.

 

[Adlante]

There have been periods of government cutbacks which have severely affected the local economy.

However, I believe the Canberra economy has become much less dependant on the public service. The last time there were sever cutbacks, there was very little affect on housing prices- unlike some previous cutbacks, which left prices in the doldrums for years.

It has been the labour governments which have traditionally increased the public service; and John Howard only lives in the Lodge when parliament is in session.

A lot of the increases in spending in recent years have been for the security agencies, including the AFP.

I would not be surprised to see more decentralisation in an attempt to recruit more personnel, but I suspect there's too much infrastructure to try to relocate existing depertments away from Canberra.

Thanks for your point of view on this matter Geoff. Cheers