Hey all,
Im looking at properties at the moment and havent had too much experience with newer properties(i.e ones that attract maximum depreciation due to age).
Simple question:
2 houses similar size, configuration, location and same rent return:
price of 1 $379k. 7 years old,
price of 2 $399k. 1 year old.My question is, is it worth the extra 20k to purchase the newer property with regards to depreciation?
Strategy is to buy and hold, long term.
Cheers,
Mick
In isolation, probably not. There are several factors to consider to get the full picture, these include your marginal rate of tax, the amount of depreciation available (you'll need a qs to determine this), the value of having the benefit of home-owners warranty on a near-new house, likely higher rental value, lower initial maintenance costs, more stamp duty payable, higher interest bill etc.
Not all of which are positive.
it is not on the purchase price it is on the original building cost – hence why quantity surveyor helpful.
Hi Mick
Your query is best answered by using our calculator and comparing the answers @ http://www.washingtonbrown.com.au
I think you'll find the actual depreciation won't be that far different.
There is long winded reason why…but i'm off for a walk!
Regards
Tyron
Mick,
While Tyron is on a walk have a read of this article that was published in API many years ago
http://www.propertyreturns.com.au/DOCS/Old%20or%20New.pdf
Liam
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