Didn't think it could get any worse...

I wrote some other ideas down and forgot to post last week, anyway, the one that sticks out to me is....

Instead of selling your home, can you rent it out

Can you go and live in Gladstone ? slowly repair/renovate, then try and sell it yourselves if you do not want to stay there long term ?

This may sound silly at the start, but depending on your income and jobs, it may be better than taking the loss.

$100 sounds way to cheap for any habitable place, be careful that those giving advice that have an interest in such things.

I also would be looking at it first hand, and take a friend who is handy if your not that up on the trades etc.

 

why would you sell if only losing $12k a year.....hold on to it 10 years and you'll make your $120k back sometime during the next cycle.

now you've just crystalised the losses AND you have to pay another $30k stamp duty again on the next IP you purchase??

It just doesn't make sense.

 

It may not bounce back...and in the meantime you lose opportunities to invest in other places where real growth can occur. And besides, losing $12k per year is a drastic hit to cashflow, especially as there is no promise of any improvement around the corner.... Sure its possible to own, but its just a drain. And you dont know if it will be up for some expensive repairs anytime soon.
I think taking the loss is the right thing to do.

 

You don't seem to know anything about myself or my financial position. As it doesn't make any sense to you, then it would appear that you would be in a different situation to myself and not be able to think about things outside your own experiences.

What do you already know about the city of Gladstone?

 

The only reason we are thinking of selling the house is to get the funds to pay the loss. Renting it out wouldn't help us here.

We have a small business and a secure job here in Perth, can't leave that to go to Gladstone. If it was an option we would go..

 

Sorry to hear EMS, it must be a really difficult moment but I'm sure in a few years everything will get easier. We had a hit similar $ to that five years ago. Family of 4 - zero income for 9 months plus property repairs, non-paying tenants and slack PM's that didn't fill out paperwork correctly for PPOR when rented. It does get better eventually!! I don't think it's a bad idea selling the PPOR. Speaking from experience, things are tight enough and if you had a defaulting tenant, vacancy or urgent repairs it can make life even tougher! In some suburbs in Perth rents have dropped back to where they were about 12 yrs ago so not a bad time to be a tenant here IMO. eg. 30 Maidos Street Ashfield WA 6054 - House for Rent #412119843 - realestate.com.au Best wishes!

 

A mate of mine sold his parents house in rocky for land value which was only 110k about 6 months ago. House hadnt had any work done on it in over 20 years. In his case he sold it to his neighbour who does up houses. He sold it privately so didnt have to pay agent fees.

What is the difference of selling the house now as land value, as opposed to spending 20-30k and then selling, would you get say 60 k equity out of a 20k spend.

You may need to take your hubby to an accountant if he cant get his head around selling, because the accountant maybe able to convince him otherwise.

 

Oh dear Ems, sorry to hear about your Gladstone predicament. I can't add much to what's already been said, other than to support two options already mentioned:

1. Get creative and try to rent in exchange for repairs/renovations. In your area it looks like properties are going for around $150-200/wk. Can you hold out until repairs are done? Will 150-200/wk make much difference to your losses?

OR

2. Cut and run. Toolooa St is typically a lower value area and with so many new homes around the Gladstone area, it's probably going to hurt for longer than the others.

Good luck.. I'm sure that whatever you and your husband decide, you'll feel better once you make a decision.

 

Just had a look at tooloola st on googlemaps
And saw a bonar, off, ann, coon streets coming off it.

Sounds like the streets were named by a teenager

 

That street looks well located when looking just at a map.......if that is a bad street/area, what is the good street/s areas ?

You would think being close to the port and being able to go to the islands etc would be a good thing.

Some of these places look cheap enough to have as a holiday place.

 

Yeah, maps are like that. The same streets can have good ends and not so good ends... I spent 20+years living there. In Gladstone, people love "new" and "views" and space for their 4WD + boat + camper trailer (ok yes I'm generalising, and exaggerating, but not by much). Prime areas are on the hills with ocean views, and other desirable areas are the newer estates with the newer houses and nicer landscaping/parks etc. Oh and areas with decent internet speed.

It's Gladstone, everything is a 5-10 min drive to anywhere. Holiday house? check out Tannum Sands.

 

At some point yes it likwly will bounce bavk...but thats looking very very far away.
If money is tight, i woulf sell. Also the opportunity cost you allided to. By having money tied up in this, freedom to invest in other things might not be easy/possiblr.

 

1) refinance, interest rates are going down, find interest only that allows repayments and has a free offset
2) advertise a job in local labour centre for apprentice builders, backpackers with experience
3) advertise in gumtree or a caravan in site forum for a retired old gentleman to supervise renovation by the above.depending on the severity of the jobs. Usually the old retired Australians are honest and trustworthy there are grey nomads that would love to park their caravan there and do this for $3000 a month. Ideally rent this out to somebody even for a dollar a day while the Reno is being done so that you can claim back repairs
4) fly there and list everything that must be done and buy everything you need and leave it in the house.
5) cut your expenses completely and pay down the loan see the mr money moustache blog for tips
6) rent out the property privately and include an incentive like a couples massage pack or an PlayStation or no inspections
7) insure the place with a good landlords insurance, tips anyone?
8) install two electronic key safes at the property and one hidden. Give builders access with one key which then gets changed after Reno is done via local locksmith and stash the full set in other key safe for your future tenant

You only need to hold the place until the 150k loss becomes a 50k or 20 k loss and that might be within a year or two.

 

I was not sure about that, if advertising is enough then that sucks because it means I THINK that a property that is empty but advertised will continually accrue time towards the 6 year primary place of residence exemption for CGT.

I was thinking rent it out to the gray nomad.

Gladstone will come back, there is heavy industry around there and they will need to shut things down and maintain them and expand them and over haul them. The gas price will go up slowly as the present excess is used and industries grow into the excess supply due to gas being cheap and making production of goods using that energy as viable. Then they will expand things and Gladstone will recover.

The world just needs to run out of stockpiled resources and things will get ticking again.

 

I just came across this summary which is quite good. Although work had dropped off considerably since it was filmed
Driveabout in Gladstone, Queensland:

This is a nice look at gladdy
https://m.facebook.com/story.php?story_fbid=776575335815390&id=596465890493003&_rdr

 

Yes nice film, but it doesn't show the massive expanses of new housing estates 10 - 20 minute's drive away from the city centre.

 

Hmmmm, so how many empty houses are there ? Or is there only a few ?
Sounds like lots !!

 

put a match to it