Got my first IP! Few questions..

Hi Guys,

Finally, after months of looking and bidding, I ended up being the highest bidder for a property today Phew!

I signed the contract of sale and looking to settle within 60 days.

I do have few questions that I need some assistance with:

1. Should I be getting a home insurance on the property now? Or wait till the settlement is done?
2. Interestingly, I only discussed this property with my conveyancer yesterday. Sec 32 and the contract looked all good. Now that I have the signed contract, do I fill the page no. 2 where it states 'Puchaser's legal practitioner or conveyancer' with my conveyancer details and then send it to my conveyancer? I did not fill this section when signing the contract. It was left blank.

Your advice on the above is appreciated.

Thank you.

 

What state did you buy in @afterbuddha

 

Sorry should have mentioned - Melbourne Victoria

 

Than yes to both..link below on insurance question

Property settlement - buying property - Consumer Affairs Victoria

 

Thank you very much. The link was really informative.

Can you please recommended any insurance companies for IPs?

 

Also, what are the recommended insurances for IP?

- Building Insurance
- Landlord Insurance
- Contents?

 

Building and landlord. Tenants will have their own contents insurance.

Note that good policies will include a small portion of contents, to allow for things in the home that belong to the landlord such as carpet, curtains, etc.

EBM is generally accepted as the best landlord insurance.

 

1. Yes I would get insurance now, even 2 30 day cover notes (different insurers)
2. I would have had the s32 reviewed prior to signing the contract. - next time hey!
No requirement to fill in your conveyancor's details.

 

Thank you @The Y-man @Greyghost @D.T.

I will get some quotes from EBM and RACV today.

 

Also have a think about the conveyancer v's solicitor issue.

One gives legal advice and the other doesnt. When all goes well its not a issue but when it goes pear shaped one is better value.

 

Does OP need to take out both building and landlord insurance now? Could they just obtain building insurance if the property is not currently rented out. However, maybe easier to get both if insurances are from the same company anyways.

The other main insurer for landlord insurance is Terri Scheer. There are a few threads comparing the two providers though I'm not sure if there is a clear cut winner. However, there is consensus to compare policies carefully especially with policies from general insurers (banks, NRMA, etc). General insurers tend to be more restrictive with their cover.

Also maybe good to start looking for a PM unless you are going to self-manage. Could go to a few of their opens to see how good they operate and then follow up with meeting if you are interested in their services.

 

Whats the go with public liability ? Is that required at all for IPs?
If so, does the EBM LL cover, provide this cover (looked at their PD and it doesnt?) ?
If not, does public liability cover from insurance on a PPOR, cover for public liability on an investment ?

 

Pretty sure it has liability cover - @brettc confirm?

 

Thats what I was thinking as the settlement is yet to happen and the house is still owner occupied.

I will have to call EBM and Terri Scheer to see what options are available.

Yup, i created a post for that:

Property manager in Melbourne West

Thought its a good idea to start getting some quotes to understand the fee structure around property management.

 

@brettc when you confirm can you also please quote my handle so am notified of your response ?

 

Congrats @afterbuddha
We recommend that you take out insurance as at the date on the contract. Some banks will not settle your purchase without insurance in place. This happened for a buying client recently.

Also best to have the COS/S32 perused by your solicitor BEFORE you buy, but you can add that to your list for next time. The selling real estate agent will no doubt have requested your conveyancor/solicitor details separately. This is so that they can establish contact and send them a copy of the paperwork.

You should also look to get a Depreciation Report done as this is an investment property purchase. Just make sure you get this done prior to doing your tax for the first year owning the property so that your accountant can secure you your full range of deductions due. Happy to make a recommendation if you'd like to PM me.

 

I would definitely recommend going through an insurance broker.

Much like mortgage brokers, they have access to all the different providers, and provided you give them information about what you're after, they can find the best policy that suits you.

I did so and saved thousands!!

 

Thank you. Looks like everyone are recommending brokers. That's the way to go then.

 

To do prior to settlement - organise building insurance, organise PM, see if the vendor/rea will allow you to advertise/allow inspections prior to settlement (hard if not in contract but still possible), final/pre settlement inspection.

After settlement - organise depreciation schedule prior to settlement but cannot be completed until after settlement, the tenant can already be living there but easier to do without a tenant there. Also the PM would be organsing an entrance report and also advertising the property.

To do prior to tenant moving in - organise LL insurance (this can be done prior to settlement to), any maintenance you wanted to carry out, I also find having a meal even if it is Chicken & Chips jus to make it fee like 'yours' and reward you .