One of the first questions investors ask me isn't about interest rates or lenders.
It's about ownership.
"Should I purchase the property in my personal name, a company or a trust?"
It's an important question.
But it's also one that can't be answered by looking at finance alone.
In fact, one of the biggest mistakes I see is making ownership decisions based solely on today's purchase, without considering where the investor ultimately wants to be five or ten years from now.
Because while choosing an ownership structure might seem like a decision for today, its impact can last for decades.
There Is No "Best" Structure
One of the biggest misconceptions surrounding property investment is that there's a universally "best" ownership structure.
The reality is that there isn't.
The most appropriate structure depends entirely on your personal circumstances, long-term objectives and professional advice.
All of these considerations may influence the most appropriate ownership structure.
That's why structure should never be viewed as simply a finance decision.
It's a strategic decision.
- Taxation.
- Asset protection.
- Succession planning.
- Borrowing capacity.
- Future developments.
- Cash flow.
- Estate planning.
Think Beyond The Purchase
When I'm discussing a proposed rooming house development with a client, I'm not simply thinking about whether we can obtain finance today.
These conversations often happen before we've even discussed lenders.
Because sometimes the most important decisions are made long before a finance application is submitted.
- I'm thinking much further ahead.
- Is this intended to become a long-term investment?
- Will there be multiple developments in the future?
- Is the intention to retain the completed asset, or sell it?
- How might today's ownership decision affect tomorrow's opportunities?
The Cost Of Looking Backwards
Over the years, I've seen investors spend hundreds of thousands of dollars creating exceptional assets, only to discover that the ownership structure chosen years earlier no longer aligned with their long-term objectives.
Not because anyone gave poor advice.
Not because the original structure was necessarily wrong.
But because the conversations about the future development, taxation implications, asset protection and finance strategy didn't happen early enough.
In one instance, changing the ownership structure before proceeding with the development was estimated to cost almost six figures in taxes and transaction costs alone.
That's an incredibly expensive lesson.
It's also one that may have been avoided had the broader strategy been considered before the property was purchased.
The Best Outcomes Are Collaborative
One of the things I value most about complex developments is that they remind us no single professional has every answer.
As a finance broker, my role is to understand the lending strategy and identify the funding implications.
Your accountant brings expertise in taxation and structure.
Your solicitor ensures the legal framework supports your objectives.
Your financial adviser may help you consider the broader financial picture.
When those conversations happen together, clients are usually in a much stronger position to make informed decisions.
The best outcomes rarely come from professionals working in isolation.
They come from professionals working together.
A Different Way Of Thinking
At Evermore Finance Group, I don't believe finance exists in a vacuum.
Every lending decision has the potential to influence taxation, ownership, cash flow and future opportunities.
That's why I encourage clients to have these conversations before they commit to a purchase, not after.
Because some decisions shape the entire project.
They're also the hardest, and often the most expensive, to reverse.
Choosing the right ownership structure isn't about today's purchase.
It's about supporting tomorrow's opportunities.
That's why one principle underpins every recommendation we make.
Finance First. Property Second.
Because successful rooming house developments begin with strategy, not just a site.
This article provides general information only and should not be relied upon as legal, taxation, financial or credit advice. The most appropriate ownership structure depends on your individual circumstances and should always be determined in consultation with your accountant, solicitor and other professional advisers before committing to a property purchase.
About the Author
Alicja Banfield is the Founder and Managing Director of Evermore Finance Group and specialises in complex lending scenarios, including Class 1B rooming house finance, commercial lending and strategic lending solutions.
Through The Rooming House Journal, Alicja shares practical insights gained from financing specialised developments and helping investors navigate the complexities of this unique asset class.
Finance First. Property Second.