anyone turned PPOR to neg geared IP? experiences?

Discussion in 'Investment Strategy' started by mgmgrand, 22nd May, 2016.

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  1. jprops

    jprops Well-Known Member

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    jprops, 15th Jun, 2016
    #21
  2. Paterson00

    Paterson00 Well-Known Member

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    Precisely... My understanding of negative gearing is that it only works if the property goes up in value by more than you have had to pay out in costs to hold the property or you've simply lost money no matter which way you cut it but I'm happy to be corrected. I've never neg geared a house.
     
    Paterson00, 15th Jun, 2016
    #22
  3. Natedog

    Natedog Well-Known Member

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    If you are 2.5 years away from being mortgage free, due to having a large ammount of cash behind you, why not just live in the house you want to with a big offset account balance and pay interest only?
    As the offset balance gets closer and closer to the mortgage ammount you will effective be mortgage free.
     
    Natedog, 16th Jun, 2016
    #23
  4. Dan Donoghue

    Dan Donoghue Well-Known Member

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    There is no such this as a PPOR that you just happen to rent out.

    If you rent it out, it's an IP.

    The ruling is** that for the FHOG and stamp duty reductions, it has to be your PPOR for a certain amount of time based on your state when you buy it.

    The second you charge someone money to live in that property, it is not your PPOR, if this is within the time limit then you will be up for some further money to the government.

    It doesn't matter what your intention is in the future, the fact that you will move back in in two years doesn't make it any less of an IP if it is rented out today.

    **This is my understanding of it, I am in now way qualified to give financial advice. Do your own due diligence and research.
     
    Last edited: 16th Jun, 2016
    Dan Donoghue, 16th Jun, 2016
    #24
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