Hi All,
currently looking for my 1st new apartment in Brisbane, going to stay for 0.5 year to claim the FHOG and stamp duty before renting out.
Can i find out what are all the types of annual fees i have to consider when renting out?
1.) Body Corporate : $1,500 – $2,200 annual
2.) Council Fees : $1,400 – $1,800 annual
3.) Real Estate Property Mgmt : 8.8% of annual rental
4.) Water Bills
5.) is there a annual property tax?
6.) Wear and tear : budget $1000
7.) any more?Cheers
NitHi, Nit
1 – You do not pay Council fees / rates because that is paid through your Body Corp.
2 – In addtion to Water Bills, there is also the sewage and park charges: Estimated at $120 annually
3 – Property Tax: I believe in Queensland, the Land Tax threshold cuts in at $500K. In a new Apt, the Land component is around 10-20% of the value, based on a 20-25 apt block. So, there will not be any Land Tax for you to bother about until your total Land holding is valued over $500K.
4 – Factor only 50 wks of rental, as 2 wks might be used to source new tenants when the old one moves out.
Wife and I bought our 5 yrs old Apt in Melbourne in Aug 07 (that's 2 yrs back). So based on these Melbournian examples, hopefully, it helps you with yours.
Regards
Daniel LeeI beg to differ, in QLD your body corporate fees are separate to council rates.
With water you need to check whether the complex is individually metered, I believe new laws allow excess water usage to be passed on to tenants. Having said that, I also have a sneaking suspicion in the back of my mind that this may not apply to units at all, even if they are individually metered, check with the local council. On the Gold Coast there are no separate sewerage charges, all covered in council rates, I suspect this will be the same for Brizzy..
Property management can be negotiated sometimes, but i always believe that if you have an on site management you are far better to stick with them than the Joe Blow real estate manager who will negotiate fees just to steal them off others. On site managers have to live with your tenants so will be a bit more picky over who goes in, also they pay a lot of money for the privilege of looking after your unit.
Another cost, but a must do in my opinion is landlord insurance, at the end of the day it is a minimal amount for a good night sleep.
rental agreements usually a weeks rent for new tenants and half a week of a resigning – both fairly harsh i think especially the resigning and certainly worth a try at negotiating. other wise after the initial period for a new tenant do twelve month leases with a rent review built into it after six months. Unless you get more than a ten dollar increase, any extra gets eaten up by the resigning fee.
Also keep in mind that although some of the body corp goes into the big black hole of "administration"some of it also goes into sinking fund, this is like an enforced saving scheme almost , so you dont have to delve into your pocket so deeply when repairs are needed and is obviously tax deductible. Also check what the body corp covers as some agents A) have no idea what the differences are and will give you misinformation
will lie to about them anyway…gasp!!! a real estate agent that lies, i hear you say. And they can be quite different to what the body corp. pay for and what you pay for.A quick search of the Body Corporate records or the last AGM minutes held by the Body Corporate will reveal the split between the Sinking and Adminstration funds.
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Hi, Tony
Thanks on the update for Qld. In VIc, the Body Corp pays for Council rates, so I got it wrong by assuming it was similar in Qld.
Yes. I do recall reading in API Mag about onsite property managers in large apt developments. Forgot about them as well.
An also Landlord insurance. How could I forget…
Regards
Daniel LeeAlso a good idea to get a Quantity Surveyors Report to assist your accountant to prepare your tax returns once you have rented the apartment. This is a onje off expense, is tax deductible and will greatly enhance your verifying depreciation costs.
This should cost you around $400 to $600.
Companies such as BMT, Depro etc will be able to assist.
Hi Daniel,
The range of rules between states is truly phenomenal, no one could really be expected to be on top of every state.
i spent a large part of my life in NZ where its all the same – well it used to be.
will lie to about them anyway…gasp!!! a real estate agent that lies, i hear you say. And they can be quite different to what the body corp. pay for and what you pay for.
; "Thumbs Up")
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