Hi everybody!!!
My first post, new here, read through lots of post already. All I can say is “WOW! lots of GOODIES! Thanks for the tips ffrom many of you!!!”
I have so much questions, ok here they go please help me out: [blink]
Purchasing a rental property from a buyer’s point of view:
1. Are there any Fees for setting up a finance? If so, how much are they usually?2. Stamp duty => 5% of purchased price? Buyer pays for it right?
3. In a property purchase, both the buyer and seller have to find their own solicitor and make a contract? Then arrange an appointment and meet together and sign? How much these solicitors usually charge? Where do you put your contracts afterwards? [blush2]
4. After signing contracts, this is when buyer’s first money come in? That is deposit of 20% of purchase price, then settlement period, after that, buyer have to start repaying?
5. If buyer hire real estate agent to manage the rentals – usually 4% management fees of the rental fees? Any extra fees in setting this management up or even determinating their service?
6. How much usually is the property maintaince cost? Well, i know this depends on tenants behaviours as well as the property itself, but is there a roguh idea on what costs they would be to maintain the property, like fixing toilets, broken windows, hmm, what else are there? [glum]
7. Land tax – how much does that cost?
8. Insurance – what kinds needed? How much roughly?
9. Any other costs involved that I might have missed?
I really want to get a grasp on other costs, whenever I look at a property, I find it extremely difficult in calculating whether it’s could be a good deal or not, since I could only relate the price to my deposit budget.
……..
Researching a property from Buyer’s point of view:
these would be my do list in order to find out whether it’s a good property:
1. Internet – council website on that particular region
2. Local real estate agents – ask them about the rentals, prices in that area, rental vacany rates?
3. Knock on the local doors and ask them about what they think about their surburbs and their opinion on properties?
4. Arrange a Valuer ( same as Quantity surveyor?) to give me a quote on the price of the property? how much this usually cost?
What would this number give me? He valued the property in the context of the structure and land types of the property or what?5. That’s it? Anything else?
I feel a little embarassed about my newbie questions, please dun laugh[blush2]
1. Around $600 or so depending on the lender
2. Yes, the buyer pays. Amount depends on whether it’s an IP or PPOR and which state you’re in. Just google stamp duty and your state.
3. The agent gives you a contract when you decide to buy the house. It is signed by both you and the vendor (seller) and contains information about the house, including purchase price. It then goes to your solicitor who checks to make sure all the info is correct. That will cost about $1000. You will keep a copy of the contract along with all the other paperwork you will get when purchaseing a house.
4. You pay a deposit to the agent (to be kept in a trust account) when you sign the contract. Not 20% though, just whatever you agree on with the agent. Usually enough to cover the agent’s fees at least. If there is more than one offer on the property, the vendor may choose the one with the higher deposit as it may indicate a more serious buyer.
At the end of the settlement period, you give your solicitor a cheque for the remaining deposit, the lender comes up with a cheque for the 80% and all that goes to the vendor. Then your repayments begin.
5. Check with the agent. I think closer to 8% of rental plus one weeks rent each time they find you a tennant.
6. Budget on 5 – 10% of rental income.
7. Don’t know. Google it for you your area.
8. House insurance, landlords insurance. There’ll be a special package for it. For a $200,000 property, about $50/month I think. Check an insurance comapany’s website.
9. Bound to be.
Costs for an IP are about 5% of purchase price.
Skyh,
Check out the resources and links on my website. I am sure that you will find them helpful. You will find some very useful information in the ‘reports page’ area. I will be publishing more information on it soon.
Todd Burns
http://www.freepropertyhelp.com.au
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