Eagle Eye Property Insights
Here’s your latest issue of the Eagle Eye Property Insights by our senior accountant Graeme Eagle.
1. “Excess rental deductions” in your income tax return, what are they? They are a net loss from your rental property. In the 2020 income tax year the government introduced ring-fencing rules stopping property investors from offsetting a loss on their property against their personal income. Excess rental deductions are carried forward to the next income tax year. They can be used to offset future rental profits before income tax will need to be paid. What most people don’t know is that they can also be used to offset a profit made on a taxable property sale such as a sale in the Bright Line period.
2. I know a few people putting their homes and rental properties on the market now there are more buyers about. But which real estate agent should you go with if you don’t already have a good relationship with one?
I have heard interviewing at least three real estate agents can be very effective. Finding out who is active in the area with the number of sales made. Ask them about how long they have been in the industry for, what their commission structure is, what advertising can be provided, how hard they will work and what they will do differently than the next real estate agent. Selling your home or rental property represents a large amount of your wealth and is very personal. Don’t just select the agent who believes they can get more for your property.
3. From 26th August 2024 the government introduced tougher rules around the use of emergency housing. So, what’s changed?
Firstly, anyone staying longer than a week needs to contact support services and make “reasonable” efforts to find alternative accommodation.
A new “two strikes and you’re out” rule has also been introduced. If a person has had two warnings for not complying with the rules their emergency housing grant, they can be blocked for a period of up to 13 weeks. The government has said the rationale is to cut down on the number of people using emergency housing. Some may say this is a measure to reduce government expenditure and another signal the government doesn’t want to be in the business of housing people.