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Amazing that you should post this question as I was with Patrick from RMG Accounting in Subiaco only yesterday after waiting for weeks to get in to see him.
I was enquiring about trusts and which way to go and he suggested a Family Trust which he can set up for $450 – I thought that was very reasonable considering some of the posts in this forum where costs have been $1000 – $2500 depending on what trusts of course.
Patrick was recommended to me by the Investors Club so if he doesn’t know property then I don’t know who would! But be warned – he is extremely busy!!
Good Luck
AnitaHi Aussielad
Yeah, thanks for your comments. Your deal sounds much better than mine!! Is it an old building and on the outskirts of town. The one I am looking at has new development going on around it and is only 8mths old. I am looking at the capital growth as I expect the costs to break even. But I was thinking about the borrowing capacity with the bank. Am I on the right track here? I figure that in afew months I’d be able to borrow against the equity. Yes I will check with the local council about the living accomm. I did read that the zoning is about to be changed there from light industrial to business. An I will check the power phase too.Back to the drawing board
AnitaHi Guys
I met the agent today and had a look thru the property and it is better than I thought. It has a roller door so you can drive in.It has an office, toilet shwr and sink all together and nicely tiled. A kitchenette plus another room sectioned off from the main factory area (which would be aprox 64sqm). Then there is a mezzanine level upstairs which has 2 rooms with windows and a 3rd room could be created by enclosing the large area at the top of the stairs. The agent tells me that it could be lived in also as the owner planned to do this but his plans changed.
He showed me all the outgoings which include rates, insurance, strata fees and total $47pw.
The tenant has public liability ins. and pays for excess water etc.
The agent has given me a copy of the lease agreement with consent by the owner. The rent is $250pw (combination of rent and o/goings) linked to the CPI every 12mths. A market value review will be made every 3 yrs. Leaase is for 5 yrs with 5 yr option.
The owner wasn’t registered for GSt but is now. I am not. Still trying to get my head around this bit as the agent has confirmed that if I buy as a “going concern” then I do not pay the GST. The tax dept says the price should be inclusive of GST and if I am registered I can claim back, if I am not, I can’t. I find the advice I’ve been getting confusing and conflicting. Can anyone help clarify this stumbling block.
Thanks in anticipation
Anita [blush2]Thanks for the feedback and for your support. You have given me lots of questions to ask and food for thought. I will keep you informed.
Kind Regards
Anita[mellow]Thanks for you advise guys. I will be speaking to the agent tomorrow. I agree I think the rent should be higher as does the R/E agent but he said “try getting higher rents in the current market”. But because there is a long lease in place I think this may benefit me getting the loan. Plus I won’t have to worry about it. I am sure it is in a capital growth area so if I sell in say 3 yrs still with a lease in place I should have made at lease $20 – $30,000 or perhaps more. Am I on the right track? I am a new mentoree so I am grateful for your good advice.
Regards
AnitaHi Steve
In my experience you don’t have to be a high earner to invest in property just as long as you can cover the expenses. So do the maths, there are still bargains to be had! I was a single mum when I bought my investment property and I had never been in any one job for much more than a year. My work history has been very insecure but I now have 6 properties so it can be done. Once the equity flows it makes things easier for getting loans and you only need to be in employment for 6 months to qualify for a loan. The first investment is the hardest fearwise but I always thought if I get into difficulties then just sell – but I must say I have never looked back!
Anita WA
