Any financial advisors on here

 Hi all 

Are there any financial advisors on here?

We are unsure of weather to sell or rent out or current home we will be travelling aus for 12 months in a couple of months (leave without pay for the best part)and will be looking to relocate once finished travelling as we want some farm land.

 

Cheers

Rod


Rob H's picture

Posts: 4955

Date Joined: 18/01/12

Doubt anyone will be able to

Mon, 2019-01-21 20:52

Doubt anyone will be able to give you a concrete buy or sell advice.

Renting it out, if your not working you’ll pay fk all tax on it.

But obviously there is possible issues.

You need to decide whether you think property will go up or down in 12 months.

At the end of the day if property goes further down your best to sell now and buy later.

But if you buy and sell in the same market (Perth, in 12 months) it doesn’t matter whether it goes up or down as both your selling and buying into the same market.

If you reckon it’ll fall sell now, skip the renting hassles. 

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The older you get the more you realize that no one has a f++king clue what they're doing.

Everyone's just winging it.

 

Scotte's picture

Posts: 973

Date Joined: 07/12/06

Been down a similar path. I

Mon, 2019-01-21 21:14

Been down a similar path. I guess it's different for everyone and different again in different areas but I guess alot of properties are still slowly dropping in value plus will the rent cover the mortgage(if applicable)  andremember to factor in the time the house is vacant which I think on average is 2 or 3 months per year in this high rental vacancy  market.

D_d_001's picture

Posts: 1427

Date Joined: 09/03/13

IMO there are not many

Tue, 2019-01-22 07:47

IMO there are not many financial advisors worth shit out there.  being that 99% of them are employed or get kickbacks from/with companies which of course they are biased towards.  

With your situation As Rob has said you are not going to get a committed yes or no.

 

suggest you write a list of all the positives and all the negatives.  

think of things like

how the property is going to look for sale condition after a year of renting vs how it looks as your owner ocupied house. 

real estate property management fees ...get some quotes unless you have someone to look after.  

how much do you have invested in the property and will you need the money to do your travel?  Or what you are going to do with that money if you sell.

you will only be up for CGT if it's rented more than 2 years so something to think about if you keep renting.  

 

From my point of view (I don't have a crystal ball and I've been wrong in the past :) rentals weekly prices are only going to go one way from here.  and that's up

banking royal commission is slowing lending considerably.  less and less are buying property (but still need somewhere to live)  and if the idiots get into power and try to stop the negative gearing side of things as well as bump up the capital gains tax this is only going to disuade more investors from buying property.  wouldn't thnk this will affect you in the next year or so as it will probably be a long process.  

Personally if you are going to rebuy anyway the idea of no house to worry about.  "got to come back to work early cos the house is not rented" "estate agent called...... tenants are not paying ....court case pending"  would be pretty appealing to me.  Dont get me wrong these things are easily handled.....if you are not 4,000 km away.  

 

 

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Money doesn't buy happiness but it pays for my fishing so ...I may be wrong there.

pelagicyachts's picture

Posts: 862

Date Joined: 23/02/11

sounds like a great year

Tue, 2019-01-22 08:50

sounds like a great year ahead -
what you are essentially asking is what is the price of property likely to do over the next year. And comparing farm land to residential is problematic as each are influenced by different factors.
The economy is not likely to race away in the next 12 months - more likely the opposite actually. Bank funding costs are increasing due to liquidity drying up in the US and Europe (as quantative easing ends and reverses), and the increase to banks is not insignificant. In the normal course of business they would have already passed this on to borrowers but due to the negative publicity surrounding the banking royal commission they have been reluctant to do so.
This is changing, some have started increasing rates and others will follow. This could drag the Reserve Bank to the table to cut rates (in order for banks to drop their rates) if they do this though it is not guaranteed that the banks will pass (all of it) on. More so, a rate cut is likely to create more negative sentiment about the outlook for the economy which will stifle growth.
I am not a financial advisor - but have worked in financial markets for a long time - going on what I have seen of financial advisors, I would not bother going to one unless you go to a "fee for advise" only advisor - but these guys will charge you somewhere between 5k-15k for advise depending on the complexity.
Without knowing the specific details of where you house is and where you want to buy - if it were me I would put the house on the market, bank the money and keep your eye on farm property , when you see something you want you will be in a position to act without subject to sale provisions
good luck and enjoy the break !

roddo's picture

Posts: 418

Date Joined: 16/10/09

 Thanks for all the

Tue, 2019-01-22 09:25

 Thanks for all the information.

It's probably more an accountant I need to talk to rather then a financial advisor it's more the tax side of things as this is the first house we have ever sold we own approx 1/3 of the house so I'm more worried about paying tax if we sell and dont buy again straight away will we pay income tax on it and what would be the tax benefits if we rented it out as we are a young family with no income for 12 months I'm guessing there would be some tax breaks if we were to rent it out. 

So it's not really a question of wether we should sell because of the market it's more about making something work beneficial for our situation. We are lucky that we bought our property when the gfc hit and it was a mortgage foreclosure so bought low and will make a profit evan in a crap market so renting would easily cover the mortgage that's why it's such a tough decision as it's not a need the money scenario until we want to buy a new place. House is in pinjarra 4x2 on a 1625sqm block so not a high growth area but a unique property being large and a rural outlook 500acre property at our back fence. 

Cheers

Rod

D_d_001's picture

Posts: 1427

Date Joined: 09/03/13

 If you've lived in it you

Tue, 2019-01-22 09:36

 If you've lived in it you will not pay capital gains tax as long as you have not rented it out for more than 2 years in the last 5......basic rule.

AS for tax breaks ....you can claim all your expenses etc back on tax if you rent it out but Im guessing you will not be earning too much for that year as you said you will be taking maily leave with out pay so tax breaks will be minimal if not non-existant.  IE you will be in the lowest tax bracket or possibly pay 0 tax if under about 19k earned for the year so you cant claim back any tax (if you havn't paid any)

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Money doesn't buy happiness but it pays for my fishing so ...I may be wrong there.

Doc's picture

Posts: 557

Date Joined: 29/05/16

 We went through this when we

Tue, 2019-01-22 17:18

 We went through this when we got on the road. Ended up my son and his family moving in and he rents out his place. Selling was out of the question, close to the beach and on a half an acre, plenty of room for our bus.

Rob H's picture

Posts: 4955

Date Joined: 18/01/12

 Good info above, important

Wed, 2019-01-23 14:05

 Good info above, important point though, you can only claim the interest on your mortgage not the principle.

Also I thought you could rent it for up to 6 years without CGT as long as it was initially purchased as owner occupied?  Could be wrong.

Also you say you only own 1/3, not sure how that is set up but could complicate things?

 

____________________________________________________________________________

 Give a man a mask, and he'll show you his true face...

 

 

The older you get the more you realize that no one has a f++king clue what they're doing.

Everyone's just winging it.

 

roddo's picture

Posts: 418

Date Joined: 16/10/09

 Cheers for the info. It has

Wed, 2019-01-23 15:20

 Cheers for the info. It has been helpfull. when saying I own 1/3 I ment mortgage for the remaining of the 2/3. Its looking like we will sell it and that way we have the cash waiting for when we buy again and can jump straight away if we see something we like.

Cheers

Rod

Doc's picture

Posts: 557

Date Joined: 29/05/16

What are you travelling with

Thu, 2019-01-24 18:38

What are you travelling with Rod? Caravan or camping?

 

roddo's picture

Posts: 418

Date Joined: 16/10/09

 We have a coromal caravan

Thu, 2019-01-24 18:46

 We have a coromal caravan pop top with pop out beds it's only 14ft folded up and as high as the landcruiser weighing just under 2T with upgraded suspension. Hopefully get it Into most places but I'm well aware we wont be able to take it everywhere.

Being you have travelled a few miles have you got any must sees for us? 

Where are you located at the moment?

Doc's picture

Posts: 557

Date Joined: 29/05/16

G’day Rod, first thing, get

Thu, 2019-01-24 20:28

G’day Rod, first thing, get yourself an app called Wiki Camps. There’s so much information on there from caravan parks to camping areas. We use it pretty well all the time. Most smaller towns welcome people travelling, they’re cheap, have usually have a dump spot to empty your toilet cassette or black tank. Over east, a lot of towns will have the pub where you can camp at, a few beers, some great food, that’s what on offer to get us people in, and I don’t mind that. We are currently running away from the cyclone, too much cloud means our solar system doesn’t work. Currently parked up at Nanutarra, we’ll move a bit more south tomorrow, but will probably go to a caravan park and wait it out and use their power for a week or 2.

roddo's picture

Posts: 418

Date Joined: 16/10/09

 Cheers Doc we have used wiki

Thu, 2019-01-24 20:34

 Cheers Doc we have used wiki camps for a while now and we are getting a nice list of favourites on there we are wanting to check out. We arnt your usual tourists it's the small unheard of towns/places that Interest us we dont do crowds. 

It's looking pretty average up that way at the moment I hope you fare well out of it all.

Cheers

Rod

Doc's picture

Posts: 557

Date Joined: 29/05/16

Hey Rod, King Ash Bay on the

Sat, 2019-01-26 19:47

Hey Rod, King Ash Bay on the gulf side of NT is probably my favourite place all up. Great fishing and a nice secluded place, gets very busy in season, but we tend to do the north when it’s unseasonable. We’re still at Nanutarra, now that the cyclone looks like it’s going past, we can get going north again from here. Probably have another look at Balla Balla or somewhere like that. 

Faulkner Family's picture

Posts: 14771

Date Joined: 11/03/08

 one thing you might want to

Sat, 2019-01-26 20:16

 one thing you might want to think about is the prices of houses are down at the moment . there is a chance prices will rise a bit by the time your done travelling. 

we looked into things about travelling around oz a while back and there is loads of free camping places around. 

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RUSS and SANDY. A family that fishes together stays together