First Home Purchases with Tenants

RickyPoontang on 01/04/2024 - 18:06
Last edited 01/04/2024 - 19:36 by 1 other user

I'm eyeing off a property that's within the Stamp Duty concessions (not fully), just got the S32 and noticed it has tenants till November 2024.

Does anyone know the following:

  1. What does that mean from a CGT POV?
  2. Would I still qualify for first home buyer concessions on stamp duty?
  3. Anyone have any advice on this scenario with buying a property with tenants?
    -The tenants seem like an alright bunch (used to S32 data to do some research) so not worried about it being a meth house.
  4. Anything else you feel like I should be aware of?

My current lease ends in September, so I don't have a huge issue with asking for a long settlement period and then conveniently swapping over.

Home & Garden First Home Buyer

Comments

  • Xetrok on 01/04/2024 - 22:39
    1. nothing really, it will be your PPOR when you move in
    2. yes*
    3. yes, ensure you have landlord insurance, the money you gain in rent is income and should be declared with your tax return, ensure you have an agent (don't self manage) give them the heads up that you'll be moving in at the end of their lease and they'll be provided with the appropriate notice to vacate in accordance with their fixed term lease.
    4. *you need to move in within the first year of purchasing for FHB stuff to be eligble or something - check the T&Cs

    none of this is legal or financial advice :)
    So if you need real, non-internet advice, go speak to a conveyancer/lawyer :)

  • bazingaa on 02/04/2024 - 00:59
    -1

    S32 and noticed it has tenants till November 2024.

    Don't do this, when I bought first home we changed COS to give us the vacant property at settlement. Landlord has to give 60days notice to vacant premises for tenants in VIC, so settlement was 60 days. As vacant property was a condition, COS would void if they fail to do this at settlement in case of tenants won't leave. Read this : https://tenantsvic.org.au/advice/common-problems/notice-to-v…

    If you buy like this, you will be a landlord after settlement and if the tenants won't leave and squat, you will be in trouble.

    not worried about it being a meth house

    There is a test for this, we got it done by the building inspector just to make sure.

  • chichi on 02/04/2024 - 09:14

    I’m a bit disturbed that you don’t own the property but you are given enough information about the current tenants that you have researched them.
    Or have I read that wrong?

    • JIMB0 on 02/04/2024 - 09:19

      The section 32 often contains a copy of the lease, complete with tenants name and other details.

  • bohn on 02/04/2024 - 09:22

    re 1.
    'It can never be fully exempt from CGT. It would be proportionately exempt.'
    https://www.propertychat.com.au/community/threads/cgt-implic…

  • ihbh on 02/04/2024 - 12:02

    I don't have a huge issue with asking for a long settlement period and then conveniently swapping over.

    Make sure you give your current landlord enough notice.

  • inertia8 on 04/04/2024 - 13:08

    Check also whether you have to pay land tax… Or a portion thereof. If the tenants don't move and it drags across the assessment period you may be up for another full team of land tax.

    As others have said, avoid if possible and make it a condition of settlement that property will be vacant.

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