Forum Replies Created
Hi Dave,
Yes I can certainly help you out with a Property Evaluation Checklist,
Here’s the link:
http://www.propertydivas.com.au/Downloads/Property_Purchase_Evaluation_Form.pdfOur website has heaps of other free templates that may be of use to you also.
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi David,
Yes Richard is spot on as usual. Here’s an extract of a document off our website that explains further about CGT:
Capital Gains Tax (CGT) is the tax paid on any Net Capital Gain made on an asset that is sold, and is included in your Income Tax Return. CGT is not a separate tax but forms part of your income tax payable.
The system has changed over the years since inception on 19th September, 1985 so we recommend you seek independent professional advice from your Accountant.
Two methods to calculate CGT
(1) Indexation
Applies to property purchased up to 21 September, 1999 where the cost base is indexed according to inflation.(2) Discount (Current Method)
A 50% discount (on assets held at least 12 months) is applied to your Net Capital Gain. This discounted amount forms part of your taxable income and is taxed at your marginal rate, up to a maximum of 48.5%One third discount applies to Superannuation Funds and there is no discount for Companies.
Keeping records
You must keep your records for 5 years from the date you sell the property.Balancing Charge
To calculate the capital gain your Accountant may need to reduce the “Cost Base†to the extent that it includes amounts you have previously claimed for Depreciation and Capital Works deductions.
If you are intending to sell a property, we strongly advise that you discuss this issue of GCT with your Accountant before you sell the property, to ensure that you are aware of the CGT implications.What date on the contract is used to assess CGT?
The date on the Contract of Sale is used for CGT purposes – regardless of when settlement occurs.Hope this answers your question.
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Julie,
Find a new Accountant!!
Accountants are natourisly conservative. Having worked myself in the industry for 15 years I know from experience that many Accountants are conditioned to be conservative. Each tax agent is required to meet certain lodgement guidelines set down by the ATO which puts firms and staff under enormous pressure to reach these targets. Their business evolves around meeting these deadlines and GST compliance has only strained this further.
As a result many Accountants are too busy to take the time to effectively help their clients with tax planning and structuring matters, instead only doing annual tax returns. Their livelihood also means keeping their noses clean with the tax office, so most Accountants tend to tackle issues from a negative point of view of “why it can’t be done†rather than looking at alternatives. I’m not suggesting for a moment that you should avoid tax but you should be taking every legal step to minimise the tax you pay. So I’d be looking for an Accountant that’s experienced themselves in property.
Sadly I can’t offer you a referal in Melbourne, but maybe someone else of the forum can help you.
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
I’d have to agree with Davo, Ipswich is the place to invest.
The area is expected to grow from 140000 to 318000 people by 2026. During this time the workforce will also increase from 49000 to an amazing 123000, so 1/3rd of the population will live and work in the area.
So why are so many people expected our here ? (I live in the area) Its because the local Council are encouraging industrial business to move to the area. Synergy Technology Park, Bremer Business Park, Swanbank Enterprise Park plus 3350 hectares is earmarked at Ebenezer/Willowbank for a new industrial area, plus heaps more. Amberley is also home to Australia’s largest RAAF base currently undergoing r$285M redevelopment.
For residential areas there is Australia’s largest masterplanned community at Springfield where 60000 will call home, not to mention the new Uni and “Orion” shopping centre due to open soon (Its HUGE 59000 m2) As Davo mentioned there’s the new Aspire high rise, and I’ve also heard they plan to build 2 new 9 storey towers opposite.Ipswich has seen a steady increase in prices lately and its now hard to find much under $200k but an average home you can pick up for $220 – $250K, still very good value.
Being a local girl maybe I’m biased!![biggrin]
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
It sounds like you’re lacking a bit of direction in your life. If you haven’t set any goals then perhap now is the perfect time to review your life. Once you have set, clear-cut goals, they become embedded in your sub-conscience and we will automatically be guided towards your goals through our future thoughts and actions.
Decisions followed up by action to get to your goals can result in great personal happiness, wealth and achievements. Be committed and passionate, but keep an open mind and embrace change as your life continues.
Here’s a link to our “Big Picture Goal Setter” to get you back on track:
http://www.propertydivas.com.au/Downloads/big_picture_goal_setter.pdf
Best wishes,
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
So true Marc. There is one mob doing the rounds at the moment on our local radio station, saying how you too can get into your very own investment property for as little as $20 p/wk and we’ll guarantee the rent if its ever vacant….Yeh right come in spinner.
Charli here’s an extract of a document off our website called “Property Secrets”
THE NUMBER ONE SECRET OF SUCCESSFUL PROPERTY INVESTING IS ….That there IS NO SECRET!
We’re sorry to tell you, but you will not find any one book, CD or seminar that tells you the magic secret method of how to become successful and wealthy through property investment – BUT these sources of information can provide invaluable information, advice and ways to succeed in property investing.
So if there is no magic secret, how do property investors achieve their success? Your best approach is to read, listen and attend seminars in order to gather all the information you can, including this Website.
Ultimately your success depends on one thing – YOU!
Every property investor can benefit from the following:A plan with clearly set goals – both long term and short term
A positive belief in your abilities and a clear expectation that you can achieve them
Knowledge and research – lots of it gained through reading, seminars etc
Action!! – Don’t just sit around – do it!
… and will find it harder to achieve success by:Failing to adequately plan, research, set goals
Speculating and making decisions based on emotion and that don’t stack up financiallySome methods may be right for you and your individual circumstances, and others may not. Factors influencing your decision include your available time, cash and equity, your age, character, family situation, and your long term goals. For example, if you work long hours and have a busy social life then renovating may not be for you, or if you have a large family with little disposable household income, then negative gearing may not be your preferred option
Find a method that suits you
There are many ways to successfully invest in property, for example:Renovating
Positive cashflow or Negative gearing
Subdividing
Developing
Buy and Hold
Flipping
Wrapping
Vendor FinanceSo that’s it – all the “Secrets” you’ll need – set out for you on just one page!
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Charlie,
Here’s an extract of a document off our website about Property Development:
What is Property Development?
There are two major categories of Property Development
Land development
Building development
What does a Developer do?
A Developer will typically acquire raw land and apply to subdivide it into smaller lots. The Developer will also improve the land by adding value through infrastructure, such as roads and a sewer.Once the subdivision has been approved and the infrastructure is in place, the land can be sold off individually or in bulk for “house and land packagesâ€, usually at a significant profit. Alternatively, the Developer can keep the land and construct dwellings on it. The finished buildings can then be sold and the profits may be used to fund the next project. Some Developers choose to hold onto some or all of the properties and keep them as investments for rental properties.
In addition to domestic developers, there are developers who specialise in other areas, for example, commercial property or retirement housing.
Essential requirements of a successful Developer
Successful developers rely on good, careful, accurate planning at all stages of development. They recognise that “time is money†and depend on a good “team†of contractors to complete each stage of the development process.
Without a reliable team, specific tasks can run way over time and disrupt the whole schedule, which in turn eats into those vital profits. Developing can therefore be a highly stressful experience.In addition to good tradesmen, developers also need the services of expert professionals to ensure the smooth running of projects. Services you may need to call upon include a Town Planner, Engineer, Architect, Surveyor and Solicitor.
Property Development is a bit like baking a cake. All the ingredients must be available, assembled and skilfully combined to get the perfect – or this case the most successful and profitable – outcome.
To maximise profits, developers should buy real estate at “wholesale†prices, as opposed to paying retail. Developers recognise that a large portion of profits are made through buying at the right price and not just through developing alone. This requires good negotiating skills and a firm resolve to walk away when the asking price is too high – without getting emotionally involved.
Downsides of Property Development
The majority of building developments require considerable sums of money and carry a certain degree of financial risk. Downturns in the property market can result in lower than expected land and property values, which may also take far longer to sell than initially expected. Holding property for long periods means increased interest and other costs, which can blow out if interest rates also rise.As well as these risks, there are also the day-to-day pressures and frustrations involved with developing, such as unreliable tradespeople or professionals, bad weather or delays in the Council process and other “red tapeâ€.
Although many developers are extremely successful in what they do, and earn a good living, it is important to realise that their job is far from easy.Basic Step-by-Step Process
1. Decide on the type of development (eg house, duplex, townhouse, apartment, retirement property, student accommodation etc)
2. Conduct a preliminary Feasibility Study
3. Find and acquire land
4. Plan the development and estimate costs
5. Approach financier for funding, if required
6. Apply for approvals
7. Build infrastructure
8. Sell land if that is the intention or develop further
9. Prepare technical design and drawings
10. Work on marketing campaign
11. Obtain quotes and building contracts
12. Commence construction and manage the process
13. Obtain necessary certification and approvals
14. Complete the settlement of properties sold and/or manage tenants.What should I look for when selecting a development site?
For further information regarding land features, read our article on Subdividing which covers issues to consider when sourcing a block of land to be used for development.Perhaps you could also try contacting Michael Yardney who’s a Property Developer in Melbourne (and also a forum member)
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Don,
You’ve done well to limit it to 4 logo’s. When we were designing ours it took months!!
I agree with Michael that No 1 is best, as I find the others too “busy”.
When you do decide, don’t forget to send it through to me so I can update your banner.
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Chicky,
Welcome to the forum. Here’s an extract of a document about subdividing off our website that should get you started:
What is Subdividing?
Subdividing is when a piece of land is split into two or more pieces (ie separate lots). The process is controlled by the local Council. Planning codes and procedures vary significantly between Councils and also between States and Territories, as do the relevant fees and charges.Factors to examine when considering a Subdivision
• Local town planning regulationsLand zoning restrictions
Minimum size of lots
Access to water and sewerage services
Setback requirements
Minimum building envelopes
Parks and open space
Easements
Vehicle access including Council refuse collection
Storm water management
Increased noise from new development
Environmental and heritage issuesHidden Costs
A subdivision can take several months (and sometimes even years) to complete so you must factor in your holding costs such as:
• Interest
• Rates
• Land maintenance – (eg slashing and weed control)Many astute Developers make the purchase contract for the land subject to the acceptance of a Development application approval with Council. This is usually done with an option agreement (see your Solicitor for more information)
Dividing the Land
Before you rush out and build a new dividing fence in your backyard, you should first consult your local Council for specific guidelines and costings, as it is imperative that the property is divided correctly. Any errors at this stage will cause major problems further down the track.The Process
Most Councils require a Development/Planning Application to be lodged, together with details and drawings of your proposal. A Town Planner or Surveyor can assist you with this process, and they may also be able to give advice regarding conditions that the Council is likely to require.Before lodgement of the Application, you can ask the Council for a “Pre lodgement†meeting to discuss your subdivision and determine what issues will need to be addressed in the Application.
When the Council receives your application, they may require you to erect a notice board for public viewing. The purpose of the board is to alert the public of the proposal by providing details of the subdivision. The Council may also write to the owners of the residents of the neighbouring properties advising of your intentions. We suggest that you contact the Council to find out what procedures your local Council uses.
Additional information the Council may require
Water and Sewerage
• Are existing services available?
• Can the existing infrastructure cope with increased use or need upgrading?
• Is permission required from neighbours to access property?Storm Water
• How will storm water run off be managed?
• Is a drainage pit required?
• Are tanks required to regulate the flow of storm water?Noise
• Will existing main road traffic noise affect the subdivision?
• If so, how will this be reduced? (Fences and/or earthworks)Soil Conditions
• Do the soil conditions (eg.sand, clay) impact on road and footpath design?
Top
Other issues
Footpath
Lighting
SignageIssues for the Developer to consider
For the Developer there are also other issues to consider such as:“Wasted†land due to unusual configurations
Steep slopes
Flood-prone land
Other planning overlays (ie restrictions)
Other factors that may reduce the number of lots and so profitability.Approval of the Development Application
The approval process for your Application may take several months depending on the complexity and size of the subdivision.You will then be issued with a conditional approval covering topics such as:
Developer to supply a plan of survey and mark land with survey pegs
Road reserve
Easements over stormwater, water and sewage mains
Requirement that storm water pipes be designed to cope with a “1 in 100 year†event.
Dust control
Hours of permitted work (usually Mon – Sat 6:30am to 6:30pm)
Headwork contributions to be paid by Developer
Open space (parks)
Social infrastructure
Road infrastructure
Water infrastructure
Sewerage infrastructure
Street scape contribution
Disposal of cleared vegetation
Entry walls or features
Connection fees to live sewer mains
Road (width, pavement depth, footpaths, kerb and channel, ramp profiles)
Street lighting
Fire Extinguisher (Battle axe blocks)
Underground electricity and phone
Erosion and silt management
Maintenance period of roads
Retaining walls
Fire ant inspections
Portable long service leave for Building and Construction Industry
If you are not satisfied with the Council’s decision, you may apply for a review.Operational Works
Before work can begin, you will need to engage the services of a Civil Engineer to design and draw the sewer, water, road, footpaths and any other Council requirements.This is a separate application usually referred to as “Operational Works†and attracts additional fees and charges.
Final Stage
All civil work will require Council and Engineering certification. When the subdivision has been completed to the satisfaction of the Council, you can then apply to register each separate title deed.Conclusion
Land subdivision is a $mart way to fast track profits into your investment portfolio. However, as with all investment decisions, thorough research is necessary in order to balance the level of risk associated and ensure that the process runs as smoothly and quickly as possible, and that the best, most profitable outcome is achieved.AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Have a chat to Ross Johnston. He’s also a member on this forum. Here’s the link:
http://www.propertydivas.com.au/7ProfServ/Professionals.aspx?cmaid=d991fecd-bbfc-4ab2-9732-da8bf2d1af97&cmstat=ProfallAmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Mat,
We use http://www.abr.com.au. They have an annual fee of $200 then the reports are extra but usually only $20 – $50 depending on what you need. All online and have results, including titles searches in seconds.
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Peter,
Here’s an extract of a document off our website about Property Development :
What is Property Development?
There are two major categories of Property Development
Land development
Building developmentWhat does a Developer do?
A Developer will typically acquire raw land and apply to subdivide it into smaller lots. The Developer will also improve the land by adding value through infrastructure, such as roads and a sewer.Once the subdivision has been approved and the infrastructure is in place, the land can be sold off individually or in bulk for “house and land packagesâ€, usually at a significant profit. Alternatively, the Developer can keep the land and construct dwellings on it. The finished buildings can then be sold and the profits may be used to fund the next project. Some Developers choose to hold onto some or all of the properties and keep them as investments for rental properties.
In addition to domestic developers, there are developers who specialise in other areas, for example, commercial property or retirement housing.
Essential requirements of a successful Developer
Successful developers rely on good, careful, accurate planning at all stages of development. They recognise that “time is money†and depend on a good “team†of contractors to complete each stage of the development process.
Without a reliable team, specific tasks can run way over time and disrupt the whole schedule, which in turn eats into those vital profits. Developing can therefore be a highly stressful experience.In addition to good tradesmen, developers also need the services of expert professionals to ensure the smooth running of projects. Services you may need to call upon include a Town Planner, Engineer, Architect, Surveyor and Solicitor.
Property Development is a bit like baking a cake. All the ingredients must be available, assembled and skilfully combined to get the perfect – or this case the most successful and profitable – outcome.
To maximise profits, developers should buy real estate at “wholesale†prices, as opposed to paying retail. Developers recognise that a large portion of profits are made through buying at the right price and not just through developing alone. This requires good negotiating skills and a firm resolve to walk away when the asking price is too high – without getting emotionally involved.
Downsides of Property Development
The majority of building developments require considerable sums of money and carry a certain degree of financial risk. Downturns in the property market can result in lower than expected land and property values, which may also take far longer to sell than initially expected. Holding property for long periods means increased interest and other costs, which can blow out if interest rates also rise.As well as these risks, there are also the day-to-day pressures and frustrations involved with developing, such as unreliable tradespeople or professionals, bad weather or delays in the Council process and other “red tapeâ€.
Although many developers are extremely successful in what they do, and earn a good living, it is important to realise that their job is far from easy.Basic Step-by-Step Process
1. Decide on the type of development (eg house, duplex, townhouse, apartment, retirement property, student accommodation etc)
2. Conduct a preliminary Feasibility Study
3. Find and acquire land
4. Plan the development and estimate costs
5. Approach financier for funding, if required
6. Apply for approvals
7. Build infrastructure
8. Sell land if that is the intention or develop further
9. Prepare technical design and drawings
10. Work on marketing campaign
11. Obtain quotes and building contracts
12. Commence construction and manage the process
13. Obtain necessary certification and approvals
14. Complete the settlement of properties sold and/or manage tenants.What should I look for when selecting a development site?
For further information regarding land features, read our article on Subdividing which covers issues to consider when sourcing a block of land to be used for development.A couple of good books to read are:
Australian Residential Property Development
By Ron FORLEE
Publisher Wright Books, 2004
Smarter Property Improvement
By Peter CEREXHE
Publisher Allen & Unwin, 2004
Our website has further reading on subdividing land which may be of interest to you also.Best wishes,
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Freetodream & Silverghost,
Its often very overwhelming when you first start out so my advice would be to follow our 7 step program:
Step 1 Set your personal & financial goals
Step 2 Prepare a budget & savings plan
Step 3 Determine your investment strategy
Step 4 Build your team
Step 5 Research areas
Step 6 Prepare a feasibility study
Step 7 Negotiate the deal and repeat!By putting a good system in place first will ensure your success later on down the track. You should be able to complete Steps 1 to 5 without very little financial outlay.
Oh and keep reading as knowledge is power!!
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Careful, he’ll get a swollen head with such praise, and he’s only just had a birthday so we don’t want to much excitement!!
Well done Richard.
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Compleks,
Our website has a document that examines the following tax structures.
Sole and Joint Owners
Company
Trusts
Self Managed Superannuation Funds
Joint VentureIts a bit long to post here so here’s the link:
http://www.propertydivas.com.au/3TaxMang/TaxStruct.aspxAmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
If you’re after a flat pack kitchen try Armstrongs. They are based in Qld but deliver anywhere:
http://www.propertydivas.com.au/7ProfServ/Professionals.aspx?cmaid=1a5abfe8-7d2e-4172-affd-1247759d1b4c&cmstat=BasicAmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Gary Seeto has put together the “Young @ Heart” club.
The Moderator for the Gold Coast group is Paul Harnett http://888abundance.com/forum/index.php
Or try sending Gary a PM off this site, as I’m sure he’s a member here.
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Baldy,
Trust ownership is probably the most flexible way to own an investment property. The most common Trusts are:
Discretionary Trust
A discretionary trust is often referred to as a “Family Trust”. It provides flexibility in sharing income within a family and can operate for up to 80 years. (Nb. This is what Steve refers to in his book.)Income is distributed according to the trustees’ discretion, by allowing the income to be distributed to lower tax earners and relatives, including children (conditions apply).
Some advantages are low establishment costs and asset protection, as only the trustees can be sued. Disadvantages include the fact that if there are losses, these will be quarantined within the trust and cannot be distributed to beneficiaries. Therefore a discretionary trust may not be suitable for investors who practice negative gearing – unless the trust receives income from other sources. Also, land tax thresholds are lower than for individuals.
Unit Trust
In a unit trust, the trustee holds assets on trust for the unit holders. A unit in a unit trust is like a share in a company, as it reflects your wealth in the unit trust. A trustee can be either a company or an individual. Advantages of unit trusts are that they are cheaper and more flexible than a company setup, non family members can own units, and also the fact that they can borrow money and carry on business. The main disadvantage is that the trustee has no discretion in the distribution of income, as the distribution is determined by the unit entitlement which was agreed when the trust was established.Hybrid Trust
There are many types of hybrid trusts, but essentially they all have many of the common features of unit trusts and discretionary trusts.However, a Hybrid Trust has a number of beneficiary classes equal to the number of unit holders. The trustee, at its discretion, may make both income and capital distributions to beneficiaries in proportion to the number of units they own. Therefore, as the beneficiaries are entitled to a fixed distribution of income, they can claim tax deductions in earning that income (ie.interest on borrowing) This effectively allows negative gearing.
Advantages of hybrid trusts are that they provide asset protection, offer the 50% capital gains tax relief and also have estate planning benefits. However, a disadvantage is that if they are not correctly established or run, they are at risk of being challenged by the Tax Office and may not protect the assets of the trust.
You can read about other Tax Structures http://www.propertydivas.com.au/3TaxMang/TaxMan.aspx
Hope this helps a bit.
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
Hi Daz,
Well done for taking the first step and reading Steve’s latest book…..and no we don’t bite!
Its often very overwhelming when you first start out so my advice would be to follow our 7 step program:
Step 1 Set your personal & financial goals
Step 2 Prepare a budget & savings plan
Step 3 Determine your investment strategy
Step 4 Build your team
Step 5 Research areas
Step 6 Prepare a feasibility study
Step 7 Negotiate the deal and repeat!Oh and keep reading as knowledge is power!!
AmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
For a Finance Broker in Melbourne try:
Cameron Perry
http://www.propertydivas.com.au/7ProfServ/Professionals.aspx?cmaid=1616e4b5-9bbf-4e0b-bd7d-ac23f83d55bd&cmstat=ProfallAmandaBS
http://www.propertydivas.com.au
FREE online Property Resources“It is better to be inconspicuously wealthy, than to be ostentatiously poor…”
