I had a commercial property in a country town – about 3000 people. Had two tenants in it for about 3 years. One tenant with gov’t funding lost its contract. Six months later the second lost a major contract. The returns were good. I spent the next year doing some renovations and was able to sell the property with a tenant about to move in and…[Read more]

The bargain of the century is a very common occurrence. Talk to some of the other agents in the town who manage property and get their opinion on likely rent and difficulty in renting.

Last year I was looking at a similar type property. Selling agent estimated rent would have given me a 7.5% gross return. I asked my managing agent to give me…[Read more]

If the business is a sole trader or partnership do a business names search with the state authority. I think in NSW it’s the Department of Fair Trading

If it’s an incorporated company do a search with ASIC.

You may be able to get information from the Land Titles Office as to what properties are held in the name of the idividual or company

If…[Read more]

How long are the reserves likely to last? Do some research in the local paper and company reports.

What’s likely to happen if the cost of mining the copper increases? (presumably they’re mining the most profitable sites first)

What’s going to happen if the Australian dollar rises?

If one or more mines close what will be the impact on the…[Read more]

In a commercial property the tenant may be responsible for paymnet of some or all of the outgoings eg rates, insurance, etc etc if the lease provides for this. If the lease is silent, then the tenant is only responsible for rent.

If you are buying an existing premises that is currently tenanted then you will need to see the lease to see what the…[Read more]

If you’re buying a new residential property the developer will hvae to include GST in the price (but will have been able to claim Input Tax Credits on the GST paid for materials, contractors etc)

As it is residential the purchaser will not be able to claim any GST back irrespective of whether they are going to live in it or rent it out as a…[Read more]

I’d support Rod. Speak to an Australian accountant who is experienced in this particular field. While there might not have been a great deal of difference betweeen Australian and New Zealand tax laws 30 years ago, there will be usbstantial ones now.

I always think that a little knowledge is a dangerous thing with tax.

Alternatively you can…[Read more]

While I’m no expert on L/O, it would seem from some of the American books I’ve read that your vendor needs to be motivated (desperate).

From your Vendor’s point of view and looking at opportunity cost if he thinks prices are going up 20% in 5 years, then on the figures you gave he needs to make about $50,000 on the option money you ae paying to…[Read more]

The 11 second rule is a guide to find cash flow positive property. If a property rents at $100 p.w, and sells for $50,000 the gross rent is 10.4% of the purchase price, allow say 1/3rd for expenses rates, insurance and repairs and you’ll probably meet the mortgage payments with the other 2/3rds.

The 11 second rule is a quick way to make a…[Read more]

No except if your IPs were held say in a trust or company and that trust/company paid you for bookkeeping. Of course then you as an individual taxpayer would have to include this income in your tax return.

crj

Misty,

In Victoria the occupational boundary ie the fences can become the ‘legal boundary’ once a certain period of time has elapsed, notwithstanding that the boundary on the title is different.

Your post says 10-15 years. I think if 15 years has elapsed then the title goes on the fences. If less than 15 years a correction might still be…[Read more]

YC,

In many country towns people go there for a short period eg 3 years because of work. Normally the cost of buying and selling means that except in exceptional times like the past couple of years capital growth would not be enough to cover the entry and exit costs. Therefore, these people are in the market as renters.

From an investment…[Read more]

Look at local history books, if there was a flood there will likely be something in the book, maybe even pictures giving an idea of height of that particular flood.

As has been stated check with the local council. Different councils will have different amounts of information.

Talk to some of the older locals.

Visit the town. Maitland Railway…[Read more]

Misty,

From the NSW perspective if the land has separate titles you can sell a one separately. This applies eg on the older deeds which might include several lots or portions. No subdivision fees.

However, just because it can be sold separately might not mean it has a building entitlement or even if it has a building entitlement that it can…[Read more]

Patrick

If you want to minimise the potential for a hiccough in your finances you need to look at your risk management.

Your risks on the property are centred on expenses and income. (As an aside have you insured your income. If not that might be worth considering as it is probably your largest asset)
a. expenses. Fixed interest rates and an…[Read more]

http://www.abs.gov.au/Ausstats/abs@census.nsf/0/773b0f602286084cca256bbf0000529b?OpenDocument

ABS has a 2001 Census profile for Broken Hill showing some basic information.

Kay, Pasminco sold its mine in Broken Hill to Perilya a couple of years ago while Pasminco was in administration. CBH (used to be called Consolidated Broken Hill) is also…[Read more]

Look at the population trends. Population has been declining for many years. Not sure of age make-up of community but have heard a number of older people are returning to the Hill to retire because of the lower housing prices.

Misty

You might find the ATO would consider this as 2 separate assets – the land as one and the new building as another. Also if you’re developing to sell they might look at that as ordinary income and not capital gain

crj

Redwing,

With these charges I’d think the PM thinks they’ve got equity in the property, they certainly stand a better chance of making more out of it than you do

crj

TwoSheds

Simplistically your figures are relatively easy

Purchase Price $79K +
Costs on acquisition +
Costs on selling =
Cost base for CGT
Subtract sale price from cost base. Divide this by 2 as you have owned the property 12 months.
eg Cost base $100K, selling price $250k, capital gain $150K, taxable Capital Gain $75k at 48.5c/$ maximum tax…[Read more]