I would like to find out some costs involved if I invest in houses, units, townhouses, well, in Victoria to start off with, so that I could have real numbers to play around when i analyse properties.
I am sure many of you experienced investors would have good rough ideas on these, please also add any if you see I might have left out:
Purchasing costs / closing costs:
Deposit (from $1000 to 20% of asking price?)
Legal fees (getting solicitor) – $700 – $2,000?
Stamp Duty – roughly 3-5% of the final property price?
Mortgage Costs – total of $800-$1350?
– Mortgage Application Fees – roughly $400-$750
– Mortage Insurance (if you are borrowing more than typical 80% LVR) $400?
Building Valuation Fees (optional? or its required to get a valuer to give a valuation so that the bank can approve the loan?) – $200?
Building / Pest Inspection – roughly $300
Initial Maintenance / CleanUp cost –
Any other costs?Total: $2000 – $3850 ?excluding Stamp Duty, Deposits and other costs if any.
Holding Costs per annum:
(if paying PM) – Management Fee 5% to 7% commission + GST.
Letting Fee -1 to 2 wks rent + GST => $550
Body Corporate fees (if any) – varies from areas to areas – $500? (i know apartments can be up to $10,000 a year, geez)
Council Rates and Fees – $600-$1,000?
Building Insurance – $350?
Land Tax – $400? (Do all houses / units / townhouses require land tax? i heard some agent said some new houses don’t need land tax)
Annual maintenance costs – 5% of expected rental income?
Any others?Total: $1900 – $2300 ?not including Body Corp. 10%-12% of rental income goes back to PM and annual property maintanence.
When I want to sell…
Selling costs:
Legal fees $700-$2,000?
Advertising / marketing cost charged by agent – $1000? (non-auction ones)
Mortgage discharge / transfer fees – ?
2%-4% agent commission of sold price
Capital Gain Tax – Max is 10% of CG?
Any others?Total: $1700 – $3000 ? without paying agent commission yet.
Thx heaps in advance!!
<3[cap]
Hello.
Purchasing costs / closing costs:
Deposit (from $1000 to 20% of asking price?)
**Deposits can vary but typically are 5-10% of purchase**Legal fees (getting solicitor) – $700 – $2,000?
**Budget on $2000 but it may be less. Make sure the fees include disbursements and GST**Stamp Duty – roughly 3-5% of the final property price?
Mortgage Costs – total of $800-$1350?
– Mortgage Application Fees – roughly $400-$750
– Mortage Insurance (if you are borrowing more than typical 80% LVR) $400?
**Mortgage insurance varies – check with your lender or mortgage broker.
For Stamp Duty and Mortgage costs estimates try this calculator: http://moneymanager.smh.com.au/tools/calculators/stampduty.html**Building Valuation Fees (optional? or its required to get a valuer to give a valuation so that the bank can approve the loan?) – $200?
**Generally the lender will arrange this themselves. If you want a market valuation you’ll need to talk to a valuer**Building / Pest Inspection – roughly $300
**Budget on at least $300 for each of these. Make sure they are insured and experienced. It’s okay to ask about previous work done.**Initial Maintenance / CleanUp cost –
**Depends on the property**Any other costs?
**How mch is your time worth? Due diligence can be very time consuming if you’re learning (believe me, I know) but it pays to be as thorough as possible. After all, once you exchange contracts it’s YOUR PROBLEM or YOUR REWARD.Cheers,
Art‘Great spirits have always encountered violent opposition from mediocre minds.’ – Albert Einstein
Thx Art! Appreciate it.
I found a good link that showed me some roguh figures I should expect.
http://www.anz.com.au/aus/homeloans/buyingfirsthome/costs.asp
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