Its REALLY tough to know where to hide from higher interest rates and rampant inflation but I know one thing from my previous analysis on KPG...over the long term these shares and returns from them have a profoundly shocking track record of keeping pace with inflation and the rest of the property sector.
Latest Govt announcement out does not specifically provide special treatment for the build to rent sector so interest deductibility for new build to rent is limited to the first 20 years like any other new residential build.
Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine
Its REALLY tough to know where to hide from higher interest rates and rampant inflation but I know one thing from my previous analysis on KPG...over the long term these shares and returns from them have a profoundly shocking track record of keeping pace with inflation and the rest of the property sector.
Latest Govt announcement out does not specifically provide special treatment for the build to rent sector so interest deductibility for new build to rent is limited to the first 20 years like any other new residential build.
Yes, most shares will see price pressure from rising interest rates. The build-to-rent model could be adversely affected by proposed changes to consent process making it easier for smaller scale residential development to expand. KPG probably can load debt on other assets to get tax deductibility for interest?
Yes, most shares will see price pressure from rising interest rates. The build-to-rent model could be adversely affected by proposed changes to consent process making it easier for smaller scale residential development to expand. KPG probably can load debt on other assets to get tax deductibility for interest?
Normally the "purpose test" precludes that sort of creativity for most investors.
Last edited by Beagle; 20-10-2021 at 11:18 AM.
Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine
They probably don't own any residential property. But that doesn't tell me what you mean by 'KPG probably can load debt on other asetts to get tax deductibility for interest.'
Any mortgage interest for purchasing commercial property will be deductible for them - what they use for security is totally irrelevant. As a company surely they are subject to the same tax laws as you or I are. So I'm trying to work out what you mean. Where do 'other asetts' come into it?
Last edited by fungus pudding; 20-10-2021 at 11:25 AM.
Normally the "purpose test" precludes that sort of creativity for most investors.
What sort of creativity? What 'purpose test'? Interest paid by a property investor is a cost, so deductible if borrowing is to purchase income producing real estate (excluding residential).
Originally Posted by RTM
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