I havn’t bought an IP yet but I’m very keen to start.
I am not sure whether to buy a block of land which I can build two townhouses or start with buying something under $100,000 and renting out for about $150.00.
The fees incurred with banks application, search, stamp duty are they all tax deductable?
If I buy a property do I need a quantity surveyor to list all depreciable items including the building or can your account do that for you?
I don’t know whether I should buy in my neighbourhood or try further afield?
Nangunia
Hello Nangunia
I am not sure whether to buy a block of land which I can build two townhouses or start with buying something under $100,000 and renting out for about $150.00.If your intention was to buy the land, build the townhouses then keep the dwellings and rent out then the answer would be that you are better off buying something already built. It will take 18 months to get them finished which will cost you money in interest and rates etc.
If you believe you can build and sell them and make a profit then yes go ahead. You will need to be fairly sure of making a good profit though to cover your risk.The fees incurred with banks application, search, stamp duty are they all tax deductable?The loan application costs are claimed over 5 years unless you take out a shorter loan. Stamp duty is added to the cost base of your property for CGT calculations.
If I buy a property do I need a quantity surveyor to list all depreciable items including the building or can your account do that for you?Engaging a quantity surveyor is a worthwhile exercise as they will prepare a full schedule for you and get all the depreciation allowances you are entitled to. Not all accountants are knowledgeable in this area.
I don’t know whether I should buy in my neighbourhood or try further afield?Depends on your neighbourhood really. If it’s a good area and you know it well then it’s probably a good place to start.
Regards
SMTM
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