Got around 100k in super and planning to partner with a friend who has 50k in super and buy a $200k apartment in CBD
is it easy?
anything to be careful about?
rather than letting this $150k lie in super fund , worth to put it in apartments?
Any Suggestion if Buying House Thru Super Fund Is a Good Option?
jrt2020 on 25/08/2019 - 01:51
Comments
Don't think you'd be able to withdraw your super until retirement age.
https://www.ato.gov.au/Individuals/Super/Withdrawing-and-usi…
I guess op wants to go via SMSF route and then invest super as business something
Would be a rather complicated and expensive to run setup for such a small amount of money.
Dumbest idea ever. Abort now.
Apartments dont have great returns, and on top youll have to actively manage your superfund on a yearly basis. Leave it in an industry fund and let the magic of compound growth work for you.
You forgot to mention that in 12 months, when they have lost money, their friendship has all but evaporated and the other party is demanding the return of their $50k.
Can’t wait till OP posts that thread…
Reasonable chance your self managed super costs will outpace returns.
Reality check.
You are from Melbourne and buying an apartment for $200k in the city.
Which city has apartments for that price?
End of discussion…
Student style studio apartments with no car space and barely any room (~20sqm) are available for under 200k in Melbourne.
They sound like a lovely investment. (I should note the eye roll, it would be a stupid idea.)
SMSF costs at least $1000p.a. to run.
You can borrow max 70%, likely less unless you have high income and give a personal guarantee.
When you say your super is just lying there, consider you will miss the current returns if you invest in an apartment.
And consider that even with recent falls, real estate is still very expensive.I think you will find the numbers don’t stack up with your balances.
I'd rather have financial arrangement with a stranger than a friend. Have seen many cases where things start great and turn sour. You may lose money and a friend together.
100k in super and planning to partner with a friend who has 50k
Why is your friend only paying 1/3?
'Friend' is smarter than the OP.
100k in super and planning to partner with a friend who has 50k
Buying apartment…
Bhwahahaha…. if that is possible, everyone in Australia will do this surely, so you know the answer.
Student accommodation apartments, apart from a reasonable gross yield, are a lousy investment with basically no capital gains over the years.
Actually, same applies to any apartment.I wouldn't invest in an apartment. We own one with so-called "cityscape views" and it has been nothing but a headache. We would have sold a long time ago if we didn't have long-term tenants staying in there. They are moving next month and we're selling the apartment to a neighbour who's planning to airbnb it like most of the other apartments in our building.
it has been nothing but a headache
In what way(s) has it been a headache?
Neighbours airbnb'ing their apartments and having strangers in and out of the building at all time of day and night. Plus all the other usual issues you have to put up with when living in such close proximity with other people.
Dont partner up with someone or invest your super in such a risky way. Worst mistake ever. Look at your super fund as your lifeline. If every investment you do with your money you have in the bank goes wrong and you loose everything. Atleast when you are an old man, you have your super to fall back on and not live a very impoverished existence.
There are other ways to do stupid things like you are questioning. You can take out a loan on your house, you can get a personal loan, you can use your savings, use your kids school fees etc. etc. to carry out investment.
Likewise, this type of investment is just like any other investment. How much money are you going to make? once you know that, then whether it is a good idea or not comes down to the numbers.
I don’t understand how you would be able to access your super funds, unless you’re under financial hardship. Of course there are some other ways, but definitely not if you are healthy and working. Also If you are running an SMSF and are partnering up to purchase it with someone else, you will need to create an SMSF in both names and create a trust in both names which will purchase the property. It is quite a lengthy and pricey process, which I would only consider doing with a spouse.
The short answer is that you have no idea how superannuation works.
It will cost you a few thousand to set up with a partner,plus yearly fees in auditing report of at least $3000
You cannot live in it yourself under SMSF
If its a student apartment check they are Strata and not company owned
You should get a partnership agreement drawn up between yourself and investment partner otherwise if things turn sour it will be costly, remember also one can force the other to sell under Section 66G, thats why get a partner agreement drawn up
Currently im going thru this myself with my then “ best friend”
He now wants to sell urgentlyWhat is the annual return minus expenses , strata, council, water rates , real estate management fees ,annual auditng fee, taxation,
Could end up less than your annual Superannuation fund returns could be a yearly loss
Then if you sell at a gain you have Capital gains tax on your fund
Are you in Sydney ? Stay away from the student apartments in Broadway, they are always on the market
Basically, its not enough , to make it worthwhile you will need to buy something substantial, commercial property etc
Ok I'm no financial advisor but what % Do u get per year in super interest vs what the housing market is currently getting? Risk in 1 item vs risk diversified in a super portfolio. Im not sure it makes any sense to get into property atm. You should pay to speak to a financial adviser and don't listen to ya friend he's probably relying on you to limit his risk by going sharsies