All Topics / Help Needed! / ABC of buying an Investment Property – Have i got it right?

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  • Profile photo of lostylosty
    Member
    @losty
    Join Date: 2010
    Post Count: 15

    Apologies if I sound like a 15 year old…well I am twice that age but when it comes to dealing with finances, I can easily stand for a 15 year old.

     

    What I am hoping to get out of this post is to clarify my understanding of some basic aspects of Property investment.  I would like to get everything on paper (bullet point form). I believe once I have a strong foundation on this, I can go a step further. Until then I am stuck here.

     

    Please expand/refine/suggest what you think should be under following key aspects of IP:

     

    Hope this might help others who are under the same situation as I am!

     

     

     

    Buying an investment property in Australia

     

    Income from investment property:

    Rental income

     

    Expenses (that can be offset for tax benefits)

    Loss in mortgage payments (if rental income is lower than repayments)

    Maintenance expenses

    Depreciation

    Property manager expenses (if used to maintain property)

    Strata fee (if any)

    Water and council rates

    Building insurance

     

    ‘Real’ cost to buy an IP

    Sell price

    + Stamp duty

    + Bank fees

    + Settlement fee

     

    ‘Real’ cost when selling an IP

    Sell price

    – Agent fee (if involved in selling)

    – Advertising cost

    – Settlement fee

     

    Net Profit

    Profit = Sell price – Buy price

    Net profit = Profit – Capital gain tax

    Profile photo of Scott No MatesScott No Mates
    Participant
    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856

    buying costs: solicitors/Conveyancer, stamp duty on mortgage, mortgage registration, loan application costs, bank valuation, mortgage insurance, buyer’s agent fees, pest/building inspections

    Selling costs: survey, S149, solicitors/Conveyancer, mortgage discharge fees, loan break fee.

    Profile photo of lostylosty
    Member
    @losty
    Join Date: 2010
    Post Count: 15

    Only one reply ….i expected this will become a single post which would list every single possible thing that need to go in the categories.

    Hope to hear from more of property experts here :)

    thanks in advance

    Profile photo of Jamie MooreJamie Moore
    Participant
    @jamie-m
    Join Date: 2010
    Post Count: 5,069

    Land tax may be an applicable holding cost. I just opened up a land tax invoice for an IP in Canberra – ouch :(

    Jamie Moore | Pass Go Home Loans Pty Ltd
    http://www.passgo.com.au
    Email Me | Phone Me

    Mortgage Broker assisting clients Australia wide Email: [email protected]

Viewing 4 posts - 1 through 4 (of 4 total)

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