Often when people move to a new home they wish to retain their current home and use it as an investment property in Ad. The challenge is to structure the transaction to ensure as much of the debt as possible is tax deductible.

The tax deduction for interest relates to what the funds are used for, not the security for the investment property loan. Therefore the funds you borrow to buy the new family home are not tax deductible.

Debt transferred to the Investment Property?

Most couples own their home jointly. In this scenario, the higher income earning spouse could borrow the funds to buy the lower income earning spouse’s portion of the current family home. A written real estate valuation of the property will need to be obtained and 50% of the valuation is the amount which the higher income earning spouse will pay the lower income earning spouse for the half share. This full amount can be borrowed and the interest claimed as a tax deduction.

The amount the higher income earning spouse pays the lower income earning spouse to purchase the share of the investment property, can then be invested in the lower income earning spouse’s share of the new property. The lower income earner’s borrowing on the flat will need to reduce to nil.

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If you are like most of us, each day when you open the financial times, you are besieged with different investment instruments and opportunities and wonder with dismay how to make your money grow. Why not spend some time considering real estate which is one of the oldest investment options of all time. This article will deal with three reasons why you should consider real estate investment as part of a larger investment portfolio.

Firstly, have you ever wondered why when the rich after speculating, park their profits in investment property? One possible reason is that property prices tend to move slower as compared to other instruments and real estate prices move generally in response to macro economic factors. This means that for most people who have day jobs, they can go investment property shopping in the weekends and the prices would not have changed that much.

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If you are investing in property or are looking to then you want to see your assets rise in value.

The problem is that many people are going to lose on their property investments unless they take action now, as property prices fall and could fall a long way from current levels.

Don t listen to the estate agents and optimists prices look set to crash further

With interest rates up, people are starter mortgages shifting to higher rates, a glut of empty building and people already sitting on loses and you the complete recipe for big falls.

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