Geekzone: technology news, blogs, forums
Guest
Welcome Guest.
You haven't logged in yet. If you don't have an account you can register now.
View this topic in a long page with up to 500 replies per page Create new topic
1 | 2 | 3 
Mad Scientist
19094 posts

Uber Geek
+1 received by user: 2478

Trusted
Lifetime subscriber

  Reply # 1636788 20-Sep-2016 19:24
Send private message

mattwnz:

Prior to the last GFC in 2007-08, a lot of these apartments were supposedly being significantly over valued. I had a valuer in to provide a market value on a property I was interested in purchasing , and they valued it for half of what it eventually sold for. I thought it sounded really low. From my experience valuations can be very inaccurate. So get a few different opinions.



$$$ยก Getting a valuation is like throwing money away.




Swype on iOS is detrimental to accurate typing. Apologies in advance.


1222 posts

Uber Geek
+1 received by user: 58


  Reply # 1636851 20-Sep-2016 20:49
One person supports this post
Send private message

I've had 2 valuations done in last 12 months, it cost $1200 for both. The houses were in different cities and the value figures provided were precisely what QV said (sale price in relation to gv). Made me wonder whether that was a fluke or if that's all they do to estimate value... And that the 16 page report and visit is just padding out time to justify the cost.

881 posts

Ultimate Geek
+1 received by user: 777

Trusted
Chorus

  Reply # 1636903 20-Sep-2016 22:05
Send private message

throbb:

 

mattwnz:

 

 

 

 

 

But are they both living in it now, for it to be considered their principal residence? Or is their main residence currently somewhere else? Also it comes down to the reason of intending to buy and sell. eg the OP did say that they wanted to hang onto it to benefit from the capital gains and rent, but presume they would both live elsewhere and rent it out. So would that mean that the bright line test would then apply? Also the clause does say 'generally' excluded the sale of the persons principal residence, so there are obviously grey areas.  It is a complex situation, so they need legal advice over it. I know someone who purchased a house to live in, they lived in it for about 1 year, and then were given a house to live rent free by their work, so moved into that. They rented the house out for about 10 years, then they sold it. They had to pay tax on the capital gain when they sold it, as it was mainly used to rent out, and not live in. This was a few years ago, so we do have a capital gains tax in place.

 

 

 

 

We both lived in it (up until last week anyways) now I live in it.

 

 

 

 

Even if only one of the named owners occupies the property, it's still that particular person's principal residence, so Brightline would not apply.

 

The brightline test is also unlikely to apply if the OP chooses to retain the property to rent out while living elsewhere. This is because under that scenario they are likely to retain ownership for over the two years at which point the test is no longer relevant. If the OP were to move out, complete a major renovation, and then put the property on the market without moving back in first, then Brightline would most likely apply.

 

Yes the term 'generally' is used in the documentation I quoted, but I believe that was the context of someone claiming multiple homes as residences. For example, a person who lives in one city on weekends, but another city during the week for work purposes. On the face of it, one would think that the weekday home is their principle residence, however their family ties to the weekend home would most likely override this, meaning the weekend home is their principle residence for the purposes of the brightline test.

 

See the Brightline test guidelines here.

 

If your situation is as complicated as this, then I agree legal advice is essential in that regard.

 

On the subject of someone owning a house, then renting it out long term, then selling it and having to pay tax on the capital gain, I'd be interested to hear the specifics on this. I have sold a few long held rentals over the years which I never personally lived in, and no capital gains tax was ever payable, as such a tax does not exist in New Zealand. Could you be confusing CGT with Depreciation Recovered? Up until a few years ago it was compulsory for property investors to claim depreciation on buildings (and land?) every year on their tax return, BUT when that same property investor sold the property, the depreciation credits received by the investor over the years of ownership were immediately payable back to the government upon sale (unless the property actually went down in value by the same amount as the depreciation claimed - ie never!).

 

 

 

[EDIT: Added link]


13545 posts

Uber Geek
+1 received by user: 2448

Trusted

  Reply # 1636960 21-Sep-2016 00:35
Send private message

throbb:

 

trig42:

 

If it is in Auckland, and bought last year, there should be a decent capital gain in it. If you half the proceeds from the sale you should do OK shouldn't you?

 

I mean they are saying that in the last year, Auckland house prices have risen by about 15% (maybe more), so if you bought at median (say) then you would have increased the value by about $130,000. Divided by two, plus getting your equity back out that you put in to start with should leave you pretty close to another deposit shouldn't it?

 

Of course, I do not know your financial circumstances and whether or not you would have the income to support a new mortgage on your own, but you could invest until you are ready to buy again (or buy an investment property in Hamilton or Tauranga, or even the Hawkes Bay or Wellington where Median prices are a lot less than what they are in Auckland (but rising - especially Hamilton and Tauranga).

 

As others have said in this thread - IMHO you are best to sell the house outright (or at least make sure that she buys it for a fair price from you).

 

My wife and I went through a similar thing, but it wasn't a break up - we had a third party on our mortgages and he decided to move away (all very amicable). We got the properties valued, he was happy with the values and we bought him out of the mortgages by refinancing with our bank. He ended up with a fairly decent chunk of cash, which he is looking to use to purchase an IP in Wellington/Lower Hutt.

 

 

 

 

If I sell I should come out with plenty for another deposit. But I guess im more in it for the house and a home, large double garage with a workbench and room for all my tools lol

 

I guess if she is being motivated by $$$ alone, I guess I could persuade he to sell depending on how the valuation comes back.

 

 

Its great that you like your home and want to keep it. She wants to keep it too. If there is too much "I want it" from both partners, that may end up with the amicability heading south, and potentially causing ongoing legal costs. 


1 | 2 | 3 
View this topic in a long page with up to 500 replies per page Create new topic

Twitter »

Follow us to receive Twitter updates when new discussions are posted in our forums:



Follow us to receive Twitter updates when news items and blogs are posted in our frontpage:



Follow us to receive Twitter updates when tech item prices are listed in our price comparison site:



Geekzone Live »

Try automatic live updates from Geekzone directly in your browser, without refreshing the page, with Geekzone Live now.



Are you subscribed to our RSS feed? You can download the latest headlines and summaries from our stories directly to your computer or smartphone by using a feed reader.

Alternatively, you can receive a daily email with Geekzone updates.