Singing a duet, getting a hug, playing Marco Polo… there’s just some things you can’t do alone. Buying a home, however, is one of those things that doesn’t necessarily require two people.

It’s the Australian dream to own your own piece of real estate in any of the nation’s capital cities, but it seems like everywhere you go, everyone from the media to your well-meaning friends are telling you that it can’t be done solo. Unless you have a high income or have inherited a large sum of money, it’s a pipe dream for most of us… or is it?

Apart from Adelaide and Hobart, where average income earners can buy a median-priced house on their own, singles who want to get into the property market in any of the other six capital cities in Australia would have been told time and time again that it’s just not possible without the assistance of a partner. However, there are a few actionable things you can do to get onto the property ladder sooner.

1. Consider ‘rentvesting.’
   Just because you buy a property, it doesn’t mean you have to live in it right now. The latest buzzword in the real estate world, ‘rentvesting‘ involves allowing renters to cover the cost of your mortgage repayments, while you relax inside a different rental that you call home. It’s on the rise, for more reasons than one.
2. Find another source of income if possible
   Going into a home loan single can be daunting, especially when it’s such a huge financial investment. In addition to the actual price of your home, you will have to pay the stamp duty, insurance, and a myriad of other expenses. Having a partner’s second income would make all these payments more bearable, but when you don’t have that luxury, you might want to consider getting a second job to secure another source of income to help meet these expenses.
3. Be realistic
   Do you want to live close to the city? Then an apartment might be the only affordable option for you. It’s important to compromise sometimes, just like all buyers have to do. Going solo on a property may limit what you can afford to buy, but you could end up with an asset that can provide longer-term financial sustainability for if and when you do meet someone in the future.
4. Speak to a mortgage broker
   Banks aren’t allowed to discriminate based on marital status, but singles only have their own income to qualify for a home loan. When single there might be other factors that impact your borrowing capacity such as having a high debt-to-income ratio or whether you live with a dependent. However, by speaking with a local mortgage broker, they can work with you to identify your objectives and requirements to provide you with options that will suit your budget and tap into other lenders and resources that you may not have access to, helping you find a better decision.

KEY TAKEAWAYS: Don’t let your single status stop you from owning your own home. There are many ways to get onto the property ladder, including rentvesting, finding another source of income, being realistic, and speaking to a mortgage broker.

Making the decision to go alone on your home loan journey doesn’t have to be a scary experience.

Speak to us today for guidance on how you can achieve home ownership.

Budget time is always a funny period as Australia halts whilst waiting for the proposal, which is then usually blocked by the opposition. Making it almost a waste of time unless they bribe the independents to vote for the bill. Forgive the cynicism, but it’s more than often pathetic!

So lets look at what’s been proposed on the finance & property front and how little thought these plans have had put into them.

First Home owners can put away pre tax savings now of $30,000 in a Superannuation like account. Now on the surface, this idea looks OK for those who could save the extra dollars per week. But on the flip side, University fees have just increased, which must also start being repaid when incomes reach $42,000. So if they manage to save a deposit, they may no longer service a loan from the banks due to increased debt commitment.

Property Plant and equipment deductions will no longer pass through to the next owner as previously allowed. Unless the new owner has personally purchased them for their property. Smart investors will now purchase the plant items separately to the property as second hand items from the vendors. Honestly didn’t anyone put any thought into this?

Foreign owners will be slugged $5k per annum if their property is not made available for lease for at least 6 months of the year. To bypass this one all they need to do is advertise their property for lease at market value to avoid this.

The big four banks are pressured to pay a new levy. I’m almost in tears. So instead of increasing taxes, they put a levy on the banks, who will simply pass on the levy to their customers.

The only good property proposal put forward this budget is where downsizers can put up to $300,000 each into their super from the sale of their home, once retired. That’s a game changer and will see many taking advantage of this avenue to downsize and top up their super without affecting their eligibility for the pension in most cases

And the opposition is no better with his plan to abolish negative gearing except on new dwellings in an attempt to make housing more affordable?! so let us get this straight – they want to shift every investor to buy new properties, which is where First Home Buyers receive free stamp duty. So by increasing buyer competition for FHB’s, this will make the property market more affordable? Am we missing something here?

The issues to fix may be complex however it seems this has been a pretty hollow budget without much substance. It will most likely not deliver any miracle cure for housing affordability nor help APRA & ASIC ease their grip on the banks & finance industry

While the big ‘bank tax’ announced in Tuesday’s Budget was touted as a method of bringing a fair, even playing field between majors and non-majors, experts have warned that the measure could adversely impact consumers in the long term.

The new levy equates to six basis points on net liabilities at the five biggest banks. Assuming up to 80% of all liabilities are captured, this could equal 4-5% of the annual profit of the big four banks, said Martin North, principal of Digital Finance Analytics (DFA).

One option banks have to cover this cost could be lifting lending rates on products such as mortgages, he warned.

Purchase a new or second hand asset such as a motor vehicle, computer equipment, an Air conditioning system, a solar system or business machinery for $20,000 or less and claim an immediate tax deduction. There are no limits on the amount of assets you purchase as long aseach asset in under the $20,000 threshold.

If your business is registered for GST then it is GST exclusive prices that count. You can then also claim the GST back from the Tax man as well on each purchase.

This is the easiest and fastest way to reduce your taxable income when so close to the financial year

The instant asset write-off program is one of two major budget policies benefiting small business.

While the asset-write off was introduced as a measure pitched at “tradies”, Small Business Minister Michael McCormack said “hundreds” of small businesses had told him the write-off rules allowed greater investment in capital equipment. Only a few measures are not eligible for instant write off, such as office plants and in-house software.

And the other reason why it works so well is that this plant & equipment can be easily financed – often on a LowDoc basis for commerical use

Examples:

Pamela bought a second hand skid steer loader for $17,000 on 08 May 2017 which is used solely in her landscaping business. As the depreciating asset cost less than $20,000, Pamela will be able to claim an immediate deduction for this asset.

Owen bought a new Solar System & Aird conditioner for $35,000 on 28 April 2017 which are used solely in his manufacturing business. As he obtained 2 separate invoices each under $20,000, Owen can claim an immediate deduction for both these assets.

Maryintends to buy a new delivery van for her courier business in June 2017. Her business is registered for GST and the van cost $19,500 excluding GST. Mary will be able to claim an immediate deduction for this asset this year as well as the GST in this BAS period.

Let us improve your business & Finance your new vehicle or equipment

You’ll benefit from Low repayments and an instant Tax Write Off

CONTACT US TODAY

A new KPMG report found that Broker clients are overwhelmingly more likely to get a better deal and renegotiate their mortgage rates.

The general manager for broker partnerships at NAB, Mr Anthony Waldron, noted when speaking at an event in Sydney that Greg Medcraft, ASIC’s chairman, had previously told the ABC that he believes “brokers deliver great consumer outcomes”

He also noted that consumers who had used a broker (or planned to do so) thought that the third party “offers a better deal than getting a loan directly with a lender, like a bank” (58 per cent).

Borrowers are largely drawn to Brokers to secure ‘the best deal’

Whether you’re an investor seeking some hefty tax deductions or a property buyer or seller about to make a transaction, there are a few tax traps that can snare anyone — especially at this time of the year.

Here are some snags to watch out for:

BAD TIMING

Land tax can be nasty for owners of multiple properties, and many buyers and sellers don’t realise that it can sneakily strike them midyear.

That’s because land tax is calculated on how many properties you own on June 30, other than your main home, and your ownership is based on the contract date rather than the settlement date.

As an example you may sign a contract to buy a new home in May or June, but are yet to sell your existing home, which means the value of the new home counts towards land tax along with other investment properties.

The excess bill can run into thousands of dollars. It’s not fun. I personally experienced this trap several years ago and there was much swearing involved.

Be aware of the risks that tax can add to your real estate transactions and investments.

BUDGET BLUES

Next month’s Federal Budget is going to have measures to combat housing affordability, so investors should keep a close eye on things.

While negative gearing tax incentives are unlikely to be scrapped, if you listen to the latest talk coming from Canberra, there’s a growing expectation of changes to capital gains rules that would mean investors will have to pay more tax on the sale of their property.

Budgets always carry risk for investors, especially when governments are having trouble balancing their books, so watch out!

DROPPED DEDUCTIONS

Many real estate investors fail to claim all the tax deductions they are allowed, particularly when it comes to depreciation.

The Australian Taxation Office allows tax deductions for a huge range of items in an investment property, from curtains and carpets to ceiling fans and garden gnomes.

The best way to claim them all is by getting a tax depreciation report drawn up by a quantity surveyor. They might cost you $600 or $700 but most tax depreciation companies guarantee they will get you a deduction bigger than the cost of the report, which itself is tax-deductible. Beware of cheap online services that don’t send anybody to your property, which means they can’t possibly spot every possible deduction.

The ATO also puts out an annual guide to what you can and can’t claim. Search for “ATO rental properties” online and follow the link.

COSTLY MISTAKES

Rental property deductions total billions of dollars a year, which gives the taxman good reason to keep a very close eye on taxpayers. Make sure you declare income and capital gains, and never claim deductions for assets that are used for private purposes rather than investing.

The ATO conducts sophisticated data matching programs that check bank accounts and lands titles offices, so you can’t hide. When you get caught, it will be costly.

We have years of experience in helping investors Finance & grow their portfolios – If you have any questions related to proeprty in any way we would be more than happy to have a chat – call us now 1300 855 244

GOOD NEWS – Banks who decide not to renew a Borrower’s business loans will have to give 90 days’ notice

The Australian Bankers Association has announced that business borrowers will get 90 days’ notice of whether their loans will be renewed.

The ABA was responding to the Carnell Inquiry into small business loans

Small business ombudsman Kate Carnell recommended that for loans under $5m banks should give borrowers a decision on roll over at least 90 business days before loans mature, so borrowers can organise alternate financing.

These changes will take place for all customers including brokers’ customers and come just after minister for small business Michael McCormack MP praised brokers at an MFAA breakfast last week:

“You’re assisting not just with home-loan mortgages, but financing for many small businesses. And this is as many bank branches reduce their retail footprint, making brokers the only source of financial services for many Australians.”