Forum Replies Created
HI there
we have one property we self manage as a holiday letting and one that is with a management rights arrangement.
The rental is usually a lot more than a permanent rental but the costs are also a lot more. You have to pay for cleaning, replacements of items – there is also a lot of wear and tear on furniture. You also can’t guarantee from one month to the next what the rental amount received will be. So if you are after a certain amount each month to pay a mortgage – the short term letting may not be the best option.
With the property the subject of the managements rights arrangement – there was definately a quiet period over December/January – because it is not in a resort area. That didn’t worry us too much because it provided an opportunity to undertake maintenance of the unit.
Like all properties – there are plusses and minuses but be aware with the smaller one bedroom places – it may be more difficult to obtain finance in such a way that you can loan say 95% of the value of the property. With smaller properties, the bank will normally lend you only 80% of the value of the property.the standard residential tenancy agreements says as follows
17 Water service charges – ss 90(1A) and 91A
(1) The tenant must pay a water service charge for water supplied to
the premises, including water fit for human consumption delivered
to the premises by vehicle, if –
(a) this agreement states for item11.2 the tenant must pay for
water supplied to the premises; and
(b) the premises are individually metered for the supply or the
water is delivered to the premises by vehicle.
(2) However, the tenant does not have to pay –
a) for water for which the lessor should reasonably be liable; or
b) an amount for the supply that is more than the amount
charged by the relevant supply authority for the quantity of
water supplied.
(3) The tenant must pay the amount of the charge to the lessor within
1 month of the lessor giving the tenant copies of relevant
documents about the incurring of the amount.
Note: If there is a dispute about how much water (or any other
service charge) the tenant should pay, the lessor or the
tenant may attempt to resolve the dispute by conciliation.
See the information statement for details.I have noticed on some of the water bills we are starting to get a breakdown between the standard charge for provision of water and sewerage and the actual water consumption.
The first charge would be borned by the landlord and the actual consumption would be borne by the tenant.
Based on the above section – the main thing is to be reasonable – because if you don’t claim it from the tenant you can still claim it on taxHi there
I note that we once lived in a rental property in Mount Waverley in Melbourne which was very close to the train line that goes out to Glen Waverley.
After a while the train noise becomes a given and just becomes background noise. I don’t believe we were offered any rent reduction because we were close to the train line – we paid market rent.
Perhaps a property manager in your area can give you some recommendations.Hi there
given the location of the property – I would say it is student accommodation because Drayton and Darling Heights are in the vicinity of the University of Southern Queensland
We too have properties in Drayton and Toowoomba – which are cashflow positive for us.
Could I just put on a rider for anyone looking to invest in Toowoomba just at the moment. There is a bit of a vacancy rate problem at the moment with a lot of properties available for rent. Tenants don’t have the same problems with lots of people looking at the same property driving up rents. We are apparently about 12 months behind Brisbane with any property cycles. There has been a lot of new properties built – with a lot of new subdivisions in areas such as Highfields, Milmerran etc and there is an oversupply of duplexs and units at the moment. There has also been a change in employment in the town with big employers like K R Darling Downs closing down part of their works. Nevertheless Toowoomba does have a lot going for it – and is a most pleasant Tree Change location. The biggest employer in town is still the education industry with 32 different schools – a lot of which are boarding schools which service out West. Many of the army personnel posted to the Oakey Aviation base and Carbarlah live in Toowoomba and many people choose to retire in the area.
As always – make sure you do your due diligence before jumping on the bandwagon.HI there
with payment of stamp duty – the time limit doesn’t normally start until your contract is unconditional. So if you made your contract subject to finance or some other condition (which was to be satisfied say 14 days after the contract), you will have the opportunity to stamp documents between settlement and the new time period. Your conveyancer will advise the OSR that the contract became unconditional on a certain date and stamping is occurring within the 3 month period.
If you still have a problem because the contract was unconditional, you will need to speak to your conveyancer about lobbying for funds from your financier – particularly if they require to have stamped documents at settlement or seeking some form of time waiver from the stamp duty office given the timeline for the settlement.
If the financier is organising the stamping, and they are late then they will be the party seeking the waiver from the stamp duty office.
As for who is responsible for stamping, if you are stamping a transfer – it is usually your responsibility to ensure your conveyancer has the funds to then be in a position to organise the stamping.
If it is a mortgage to be stamped – that is normally your financier who organises this.
Every state has a slightly different process given it can be either the contract or the transfer which attracts the duty. For example in QLD, both the contract and transfer are stamped at the one time – and stamping can actually occur in a solicitor’s office – as they can act for the OSR – and forward their stamp duty returns at the end of each month.
It is a problem for your conveyancer to resolve.Hi there
it is not all that clear if this is an existing development or proposed development
it if is an existing development – shouldn’t there be surveys with the development application?
If you can identify a particular development application – perhaps you can then search those recordsI note that I am just recalling what we had to lodge with our development application when we were rebuilding after the Canberra bushfires and there was definately a survey providing a contour map with relevant heights
Hi Linda
we are in QLD and most of our purchases have been in QLD
we have only ever paid $500 for a deposit and if pressed for more have offered a deposit bond
– there is another thread dealing with that in relation to a VIC property on this forum
The money only ever sits in a trust account and earns no interest – I would prefer that it was in my account earning interest.HI there
you might just want to confirm the following with your solicitor – but what you are describing are outstanding rates which are normally adjusted at settlement. The Vendor is usually responsible for rates up to the settlement date and and the Purchaser after the settlement date.
The auction contract will normally say something like settlement will occur 30 days after the parties sign the contract.
Because a mortgagee has stepped into the role of the Vendor – and he wants to be in a position to give clear title to the Purchaser – normally the arrears would still be dealt with at settlement – there would be a cheque for Council.
As a Purchaser – you would want to make sure the Council was paid at settlement or else your land would be charged with the outstanding rates.
Hopefully there is enough money to pay both the Council and the Mortgagee after the auction – you would definately want to make sure they won’t be looking to you for any payment.HI again R P Brown
so far we have been happy with Jason Elliot and his team – we had also moved on from another firm in town who charged twice the amount these guys did. I must admit we got him to quote before we gave him our work – and he kept to the quote. We also know the strata title manager quite well – so perhaps the networking helped.As for being slow – given the amount that Accountants have to keep up with nowadays with the regular BAS, IAS, tax returns etc – I actually thought they were quite reasonable. We gave them our files in August and we were signing documents in September.
The other Accountants we moved from had our work for months before they did anything and left it to the last moment – which created a lot of stress. We had almost immediate responses to emails we sent and were definately filing documents well within the prescribed time limits.Hi there
if you are purchasing property in QLD you might be interested in the new smart maps available
http://www.nrw.qld.gov.au/factsheets/pdf/land/l99.pdf
which incorporates a lot of the information in other reports into a shorter form at a reasonable price.
Hi again Terry and RP Brown
you may like to follow the link below
to review the information that is available from Superannuation Australia Pty Ltd. Members gain access to a DIY Fund Manual and can also speak to professionals who are involved in the superannuation industry. (You can access helpline calls)
I note that we receive a downloadable manual each quarter and regular newsletters which advise of recent changes in superannuation from this organisation.
Hi again RP Brown
I responded to one of your other queries regarding an accountant in Toowoomba. Could I suggest you talk with Elliot & Co – they have a financial planner on staff as well as the accounting staff.
They prepare our annual financial statements and audit our self managed superannuation fund and also assist us with the family trust.
Before you move anything from other superannuation funds you need to find out what the exit fees are and consider what your investment plan is for the future. Also particularly consider what insurance may be associated with your current scheme as it may not be available to you in a self managed scheme. Also please consider that a self managed fund can’t borrow funds (except in short term circumstances with strict rules to comply with) – so by moving your property into that area – you may be limiting your access to equity.
Hi there
if you follow the link
http://www.reiv.com.au/reivsamples/118COS_RE.pdf
it will provide an example of the contract of sale applicable in Victoria
you can have a deposit go into an interest bearing account – and regulate how interest is dealt with – can be a bit of drag cause you have to have Tax file numbers etc to open the account
you can also negotiate how much the deposit is – though traditionally real estate agents will try and get 10% so that there commission for the sale is paid
have you thought of perhaps offering a nominal deposit and offering a deposit bond (which is something your solicitor can do) – being basically a promise to pay the deposit
that way you keep the interest on your money
thanksHi there
we had the same situation with one of the properties we purchased. We just asked the Vendors agent if our property manager could have access to show prospective tenants through. As the agents knew one another – it was no problem – but the Vendor’s agent still had to be there during the inspection.
If in any doubt – make it a special condition of your contract – particularly if you have a long period before settlement.thanks Terry – good to see that a government department drops their costs occasionally – nevertheless realistically most people will spend more than the $400 for lodging the form 201 – because they will either buy a company off the shelf (with inherent costs added) or will buy a company after receiving advice from either an Accountant or Solicitor and there will be their costs for advice.
It would be interesting to see how many people on this forum have actually had personal experience with being sued. We have held property for 18 years and have yet to have a problem with a tenant but do know of friends who did have a tenant sue after she fell down their stairs. Fortunately their insurance company did not deny liability and the matter was settled.
HI again
you could probably use the same trustee company to start the new trust and if there is any problems down the track – you appoint a new trustee – which can be another company.
The problem with having a new trustee company each time is as Terry says the costs involved. As a bare minimum you will have to pay around $800 to set up – because those are the costs of establishment with ASIC – the Australian Securities and Investment Commission.
There are also the ongoing costs of having Accountants prepare returns, also the ongoing returns you have to lodge with ASIC.
You really have to consider your situation and what risks you face to see whether the costs should be necessarily incurred.
thanksHI there
LOC stands for line of credit which a lot of investors use. They draw down the required amount to pay stamp duty or other costs of purchaseHi there
can I say it depends upon who you speak to
I note my accountant suggested it was only necessary to have one trust for the properties purchased, another property investor recommended I have a separate trust for each state that I invest in, though I could have the same trustee company.
I suppose it is an issue of risk management – how much property do you want to put at risk if you are sued – though the trust structure is the best asset protection mechanism. There are attempts by the legislature for example in family law situations and bankruptcy situations to be able to reach beyond the structure to access property – so it really is up to you.HI there N Brown
by the way we are in Toowoomba and use Elliott & Co who are the largest strata title managers in town as well as an accounting officeIf you wanted to share experiences in property – please email – and we could discuss our experience with mortgage brokers etc
HI there – as every state is different – has different property laws – there is no proforma commercial lease which can be used across Australia.
Each state normally has a real estate institute which draws up a commercial lease for use by real estate agents.
Perhaps you can search your local real estate institute and see if they have a proforma available for purchase.
If in doubt – have a solicitor draw up a commercial lease for you. Most solicitors will have relevant precedents and can adapt them to your particular situation. It is in your interest to get professional advice before jumping in as there are all sorts of issues you may need to consider including insurance, recovery of outgoings, GST impacting – and if you get it wrong – you can expect to pay big money to fix the problems.
