Real Estate Sell Down

I'm just waiting with bated breath to get outta here.

 

I was at first, but now I'm just chillin'. I'm in no hurry. I want to make sure that I'm safe before I jump back on a plane.

 

First vax mon 29th , then booster 3 months later . Waiting for NZ / Cook Island travel bubble .
? 6 months

Cliff

 

Same. Making the most of domestic travel and supporting regional. Already have 4 months of bookings starting April.

 

That's exciting! I like it

 

I was planning to spend some time living OS but I'm now starting to get over it.
While it would still be nice to visit friends and family around the world looks like there's gonna be lots of srama for a few years to come.
Heck can't even travel across state borders and wha's open could be closed at a moments notice.
So It may be a unit in Noosa, Arlie or Cairns instead.

 

some of my favourite places. I'll actually be up there in a few weeks to start a 9 week holiday. Can't wait.

 

Awesome! Can you scout out some units overlooking the beach please?

 

Oh you actually want to buy in Noosa? Noice. I love the area and surrounds.

 

For the first time in 30yrs my position is debt Zero.
While I did draw down a LOC for investment purposes, there's more in an offset.
It's kinda a little strange and different not having thousands debited from my accounts this month to pay the banks.

I like Noosa but it seems a lot more expensive than nearby areas and Arlie, Cairns.

 

...friends did similar sold out from syndicate did not lose much at all over the years and upgraded but they prefer the actual manual sailing with 39 feet or something like that, lots of work, I went with them sailing but it's not for me, sorry, bought maybe 1-2 years ago, I think?
However, their budget was slightly up double I would guess.
They also bought a parking place in Northern Beaches marina so they can rent that out or keep their boat there.
I suppose if you can afford $XM boat you can afford the outgoings too, etc...
I think it's your choice. Perhaps spend 15 minutes on each boat one at a time and write down all the positives, then negatives, and then compare the two lists. Whichever has more positives I would go for so your decision making process is not biased! Hope that helps?

 

Look at Coolum, Mooloolaba and Caloundra on the Sunshine Coast. All great areas. Noosa is nice but very expensive and not as diverse in its offerings.

 

I like this sentence.... alot! Less admin paperwork too!
I tend to think in our situation if the banks don't debit then ATO or OSR will? But that's still a nice choice to be in, I suppose?

 

One way or another they will get their cut, but yeah it's nice.
Like a big reset button and go forward without past ball and chains attached.
And hopefully a few years of experience taught to to do things better.

 

Agree, nothing beats what you learn, they can take everything but not our experience or knowledge!
I tried to see how I would feel and I could relate to your words 'little strange'!
However, I did some of our calculations if certain Custodian Trust Assets of our Super were paid off and titles would transfer to SMSF, that would shift us next level for land tax, so at this stage I would rather pay Lender's IO (which loans are actually offset) then a much higher OSR Land tax bill. Cannot escape that even in pension mode in Super, but can sell some at low tax environment 0-15% (would surpass current limits of TBC of $1.7M each hence 15% not all at 0%).
Personally, similarly don't wish to climb to the next level even higher... but I think valuations will do that slowly they will creep up.
And unlike you, don't wish to sell!
Good choices to have.

 

Land tax and rates was about 20k this year.
Hopefully I can be more efficient than that from now on.

My tax rate has always been low. That how it goes when you asset rich-cash poor. And it was by design. The biggest expense is interest, and it's tax deductable.
A 60k taxable income has about $9200 in taxes leaving about 50k net income.
So in effect the tax rate is the same as super. Without any of the **** fight that super is.
That's about $950 after tax per week, per person. 2 people =100k pa. minus 30k interest for ppor is about 70k or $5800 mth to live on. Luxurious lifestyle certainly not, but not poor either.
And that puts your tax rate equivalent to super at 15%. I'm more than happy with a 20% tax rate and to be in charge of my money.

Mind you when I started investing there was no SMSF, you had to give it to the slick beamer driving salespeople working in a big glass building who gave sweef FA back.

Great choices to have!
But here's the thing, unless there's an economic crash (and the possibility is there) I will do more wealth wise in the next three years than the previous 10.
It's like Aladdin's whole new world of opportunities has opened up when you have cash. Yes it is king.

 

Congratulations! At least you know what you want or are working towards, many don't.
That was my plan 21 years ago to generate around $100K, both around $50K each, gross I suppose as didn't think about net figures then. Once surpassed that continued on and on and on..... including Super.
I understand your dislike for SMSF (no control, rules change, no early access, etc...), but in our case we have paid off PPOR, have investments outside, and business, and so looked at alternative entity such as SMSF to invest to diversify, took total control of SMSF in 1995. So all investments in SMSF are 100% controlled and invested by us not outsourced like most do that run their own SMSF (I didn't realize that, that many actually then go for advice how to invest, we didn't, I suppose I like some risk and I love finances). And we did well there, who knew, so I started to buy IPs directly then in SMSF too. Once was generating > 6 digit income in SMSF decide time to leverage some and buy more, as we still had few years till our 60 years of age, when it would then be all tax free, no longer all will be tax free. Now stopped accumulating in SMSF, but continue to do that outside of that entity.
I wish I had $20K to pay, much much much more to pay. Even more than one of my adult kids is earning (just realized that!)
You are funny, most of the time I have to reread what you post to understand and some I still don't get, like this comment?
Mind you when I started investing there was no SMSF, you had to give it to the slick beamer driving salespeople working in a big glass building who gave sweef FA back.
And on your last comment, long ago just when I arrived in Australia I vividly remember one of my mum's friends' son's comment. "Remember the hardest is to make your first million, then it should be smooth sailing...."

 

SMSF is good for a high earning paye. Anyone on 200k+ should have one.
Although the option not to focus on super is not as bad as many think, including accountants.

In the early 90s I was just starting out in the workforce.
The folks in suits would roll up in a nice shiny beamer or merc, pay the supervisor a $50 note and he would allow us a 20-30 min break so the suit could give a presentation on his investment/retirement scheme.
The crazy 80s had just finished but they would still use 80s interest rates of 12-14% returns to compound and project 20 or 30 years out.
And by golly with a few bux a month you could retire with millions and a beach house.
According to them a 25yo would retire with 5m+ handing them only $500mth.
I was curious, did some research. One night out in the city I looked up.
Big tall glass buildings with the same logos on the presentations.
So not only can they make me millions, but they can also buy these buildings, pay for the mercs and beamers as well.
The answer was no, it was just slick BS.
And when super became compulsory, it was handed on a platter to the same logos. And the same smooth talking suits were now on a 100% sure thing with newer and shinier cars.

So giving them my money in return for peanuts was not a good idea imo. Buying property was.
Even using the same money on the ASX20 would've done better. WPC was $1.75-2.00


And it still goes on.
A big change is coming to super — and it's good news for you

 

Great post. Very insightful, and well put.

 

Never heard of him, but i do a few things similarly.
Just like "why have a job, have a house or 2 instead".
And that's another reason why in my early 20s I was looking to "retire" from work at 40 and not interested in any super type schemes.

Later I could buy a 500k house in a swanky suburb near the beach, or buy 4 out west and use the income to rent a swanky beach house.
Those economics haven't changed much over 30 yrs. Exept for the small periods of extremes.