First investment Property - Buying check list

Discussion in 'The Buying & Selling Process' started by melbinv82, 7th Jan, 2020.

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  1. melbinv82

    melbinv82 Active Member

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    Require some feedback About any steps I may be missing.

    My finance has been approved, the property has passed the building/ pest check. I will have to put in the 10% deposit next week. It will settle Will settle in feb.

    As it is a investment property, I had read for deprecation many people will find a property depreciation expert, is that helpful? Mine is not a new property.

    Other than that, I intend to contact a accountant to organise the rental income/taxation , will get property/landlord insurance.

    Is there anything else that I should be doing. Thanks
     
  2. Trainee

    Trainee Well-Known Member

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    Have a property manager to manage it?
     
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  3. melbinv82

    melbinv82 Active Member

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    Yes, I will do that.
     
  4. Archaon

    Archaon Well-Known Member

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    How old is the house?

    Depreciation schedule is advised, as there could be available deductions, BMT offer a guarantee that they can get you the cost of the report back in the first year (IIRC)
     
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  5. Dan Wood

    Dan Wood Well-Known Member

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    I'm going through this now and wondering if it's even worth it for a 30 years old unit complex...

    BMT was quite expensive, just under double the competitors. I'm sure they're good though..
     
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  6. melbinv82

    melbinv82 Active Member

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    The house was built in 1975. The bathroom, kitchen, verandah, backyard(cement floor), they look like they would have been renovated in the last 10-15 years.
     
  7. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

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    Sounds like it's at least worth a look. That sort of scenario might see you with a couple of grand in deductions yearly over the next 2-3 decades. If you can send me a message with the address or email [email protected], I'll see if I can find some pictures online and make a more accurate assessment.
     
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  8. melbinv82

    melbinv82 Active Member

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    Received the building report after the inspection, nothing major but there are some minor issue.
    • Some Roof tiles are broken
    • Floor in one area is uneven in the common area
    • Wood rot -small area in verandah
    • Some grouting issue, cracked tiles in bathroom
    I will be talking to my conveyancer tomorrow regarding the report, but what is usually the process?

    Is it me telling the vendor that these things will has to be fixed before I put 10% deposit or perhaps settlement?

    If the vendor refuses but the defects are minor what would happen ?

    Thanks
     
  9. The Y-man

    The Y-man Moderator Staff Member

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    We normally do the building inspection BEFORE putting in the offer - so we have a figure that allows for all the repairs.

    If you have made the offer and then done the report, you may (subject to the wording of your contract:
    1. crash the contract and walk away based on the report
    2. accept that these issues are minor and fix it yourself
    3. negotiate with the vendors to have these fixed (on the threat of withdrawing from the deal)
    The Y-man
     
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  10. melbinv82

    melbinv82 Active Member

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    The vendor has come back and does not want to repair any items we had requested through the conveyancer. I understand, he has every right to do that.

    Overall I like the property , bank valuation is more than my offer, overall I should be able to rent it for the next 10 years without much repair work.

    Is there anything I can do to either slightly negotiate the price lower or get some of the things fixed?

    I still want to go ahead and not cancel the contract.
     
  11. Archaon

    Archaon Well-Known Member

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    get some quotes for the works to be completed then take that to the vendor.

    Why is the floor uneven? Slab or bearers/joice?

    Cracked tiles and grouting issues you could see with your eyes and would've factored into your offer i'm guessing.
     
  12. melbinv82

    melbinv82 Active Member

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    The property is 35 years old. Overall the building inspection report and when I talked the inspector directly, do not beloved had to be fixed In the short term, but some displacement over time, stump related
     
  13. Archaon

    Archaon Well-Known Member

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    What does the building inspector say, does it need shoring up? Is it much of an issue?
     
  14. melbinv82

    melbinv82 Active Member

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    Does not have to fixed now, more of a long term fix.
     
  15. The Y-man

    The Y-man Moderator Staff Member

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    Sorry - I just re-read this.


    Did you say floor is uneven in the common area?

    Is it an apartment?

    The Y-man
     
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  16. wylie

    wylie Moderator Staff Member

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    You could see the floor area was uneven, perhaps the wood rot and surely the grouting and cracked tiles.

    You couldn't know about the roof tiles before signing the contract.

    You are paying less the bank valuation.

    What sort of discount would you be looking for?

    Personally, I'd just settle and get the roof tiles fixed, guessing couple of hundred dollars at most?

    We had purchasers try this on and it annoyed me so much that we took our professionally drawn extension plans (would have left them behind). We also took the full page photographic paper framed full page story about our house that was in the newspaper from 1932. It took us days to find it, going through the State Library, page by page, year by year.

    So they got a little money out of us, but lost a lot of good will and some valuable things we would normally have left with a bottle of champagne and chocolates (which they also missed out on).
     
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  17. melbinv82

    melbinv82 Active Member

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    It is a house. 700 sq mt block. In Cranbourne.

    It is in the area between living room and kitchen. In the house.

    I went for inspection walked in that area twice. Not noticeable. But when the building inspection checked, they found it is not straight, slight slope. Not sure how to describe.
     
    Last edited: 16th Jan, 2020
  18. melbinv82

    melbinv82 Active Member

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  19. The Y-man

    The Y-man Moderator Staff Member

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    Inspectors can be pretty tough (which is GOOD) so they let you know there is a fault there which may become more noticeable over time. If he said not an issue in the short term, I would probably still proceed (again, I would have done the inspection prior to putting offer in - much easier then to get price down).

    The Y-man
     
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  20. melbinv82

    melbinv82 Active Member

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    Thanks for the tips and options. Next time I will be More careful. This has been a good learning experience.