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Watch out with what yo are doing. Taking money out of a loan account is ‘new’ borrowings & the purpose is paying off your ppor which is not deductible so the new borrowings are not deductible.
Using funds from an offset account are treated the same as savings, your IP loan interest is charged on the outstanding balance.I was having a chat with a developer yesterday about the Brisbane/Gold Coast. Although they are selling OTP in Brisbane they are concerned about the state of the market.
What do you want to achieve? Asset protection? Distribution of profits? etc
What role will you take? Builder? Developer? Passive investor?
Who will hold the building licence? You/spouse? Contractor?
Have you purchased the site already?
Have you been reading this weekend’s Eureka report?
US & Europe massively overextended. China & a few others financing their living beyond their means. Gold up 30%+ in 12 months yet people still flee to the usd not gold in troubled times.
And how much did she pay for this great seminar & tutorial?
I would be assuming that they are looking @ family day care not a childcare centre. The works are generally of a minor nature & are more oh&s issues like stair barriers, gates etc.
Just to throw a spanner into the works:
TDC: 6x$600/1.1 = $3,272,000 ex gst
Developer has ‘paid’: 3x$600k/1.1 + $500k + $240k = $2,736,000 ex gst
Net equity: $3,272k – $2,736k = $536k
If there is $500k to be made for zero outlay, why wouldn’t the vendor just proceed without a non-contributing 3rd party?
Totally dependent upon your target market. No point in having a range where the norm is u/b & hotplates.
Hi Homer,
I did a trip out to Rhodes this morning to check out the Billbergia apartments (as well as whatever else was happening out there). Billbergia, from my initial contact appears very legit (currently selling Homebush off the plan and another one at Rhodes shortly). They have been around for a while, having completed a project at Lane Cove North which does not appear to have a bad report.
The surrounds have basically been remediated – Meritons appear to have finished their works as well – this involved burning the contaminated waste to remediate it and this was giving rise to a chemical odour in the area. Meritons are known for taking the most cost effective way to complete their works so, their quality standards are not the same as those of other developers in the market.
As Angel above points out, Regis Towers is a nightmare (it may even have been done by Meritons but you'll need to check).
There is generally no capital growth over the first few years after purchase of an OTP unit: firstly due to the development margin puts the property above other properties in the resale market, secondly buildings depreciate so it will take a few years for the shine to come off the building and the price to stabilise (balancing out the developers margins) and thirdly unless you have also recieved stamp duty concessions, it will takelonger to break even on the sale.
PM me and I will give you more info.
Cattaby, renting of a property is regulated by the Office of Fair Trading/VCAT etc in your state.
In NSW the OFT has the lease and inspection report available on line for downloading. There is a wealth of information there to be read, you must provide prospective tenants with their rights etc as well as becoming aware of your obligations as a landlord.
NSW Renting Guide
NSW Residential Tenancy Agreement (2010)
NSW Condition Report (2010)
NSW Tenant ChecklistAh Grasshopper, just as the banks are loathe to lend to owner builders and are much more stringent on the release of progress payments, so are insurance companies when it comes to paying out monies to inadequately or uninsured, untrained 'tradies' where the liability may flow back to them. They want their pound of flesh but require that the scales are checked and properly calibrated.
Builder's prices are not necessarily 'loaded' but are more often reflective of compliance costs with BCA, OHSR, OFT etc and the fact that they may have overheads to recoup (ie staff wages & oncosts), tools, rent, phone/office/back of house etc, marketing costs, licensing and CPD requirements and the list goes on.
you may need the services of a valuer to quantify land values & accountant to determine any gst payable.
If you intend to do the work yourself, you will still need to satisfy the lender of your ability to satisfactorily complete the works & not lessen their security as well as providing home warranty insurance or complying with the owner builder requirements & payments.
Applying any additional funds to other property may lead to the insurer to sue for unjust enrichment. How do you intend to backup your claim to the insurer?
I will be meeting up with these guys later this week – PM me.
the insurance company has no relationship with your bank, you direct it where to deposit the funds, not your bank.
Be forewarned that taking a payout & not effecting a building contract for the rectification work, may mean the insurance company may not accept the premises as a risk.
These numbers are for statutory ratings purposes only. The valuation has not been commissioned by you for a special purpose, you are not privy to those instructions & it has been undertaken using mass valuation methods.
So, in short, no.
Thx Jamie, that was my concern – you'd need to have quite a few units to justify a fulltime caretaker (even $45k pa + s/c accom + materials/consumables etc) then adding std BC fees, insurances, maintenance, rates etc. The rents may look attractive but the outgoings would hammer the returns.
High management fees, high cleaning/linen hire charges, poor capital growth expectations, difficulty in exiting the property when you want to sell, tied to an onerous management agreement etc.
Are the units to be strata titled or sold on a sublease? Either way, it will be more difficult to get all owners to agree to a sale if the site is to be redevelopment & an offer made to buy the block.
Will the management retain ownership of any units? Ie their commitment to the motel.
