SA Holding Costs

Hi All,

Am in gear to make a first IP purchase soon enough and am finalising all the financial analysis/outgoings.

Was wondering if anyone has accurate numbers for holding costs for properties in different states? namely SA, QLD?

Looking for an indication to:
- Land Tax
- Council Rates
- Water fees

Best

 

You may or may not be liable for land tax.

Is a few hundred difference on rates and water enough to affect your investment decision? Should it?

 

Yep, should have disclosed budget would be around the 300000 mark.

The plan itself is a little unorthodox...

Knowing the holding costs will give me a good understanding of my monthly cash flow, which will prove possibly more important than my yearly.

 

Don't forget Stamp duty
SA is right up there....

 

Council rates will vary significantly across council areas. Some councils include water with their rates, others use separate utility providers.

Insurance can be awkward - "everyone" gets charged premium increases after a weather event when there are massive claims, even if you are not affected. The further north, the higher the insurance rates. I have heard that the Qld Govt told the insurance companies last year to get real but I dont know if they have removed their premium surcharges or not.

I think I pay 8.8% for Property management - I asked for a discount due to the same agency having two properties. They usually charge 9.9%. Land tax threshold is quite generous before it kicks in.

The worst thing I found (there were several) with our regional property was being charged at least $100 every second month in "maintenance" calls - to change a light bulb, to change a tap washer, for a power point that intermittently stopped working but the electrician kept claiming there was nothing wrong with it.

 

You have no savings and plan to airbnb or renting seasonally to students or backpackers?

 

More or less part of my bulletproof strategy...

Thanks for the great info. I suppose you can't expect the tenant to behave like the number in your spreadsheet. The extra costs for PM is justified then? for peace of mind?

 

Hi @Riot You haven't mentioned the location. My comments last night may not even apply to the location you are considering.

PM? Depends what you are going to do. You may not require a PM if you are planning to live in the same property and you have excellent management skills. You may live onsite and be useless at managing your clients. We dont know.

 

Flying by the seat of your pants is a very risky strategy. What if......? How do you cover contingencies?

A low value purchase in either SA or Qld may be treated differently eg - absentee landlord (in Qld) gets hit harder than in some other states, land tax concessions don't necessarily apply for different entities (company vs trust vs personal etc).

 

If a broken toilet will bankrupt you, maybe think again. More tenants = more wear and tear.

 

@Angel @Scott No Mates Appreciate the responses. What I wanted to weigh up was the option of having either 1 in Adelaide, Northern area potentially Modbury versus 2 in Brisbane. I am more familiar with Adelaide than Brisbane, but upon first glance it seems cheap down Logan way.

I am significantly more concerned with option 2 as it is more favourable yield wise, however contingency wise could be very dicey. But with some building knowledge and advice from a trusty BA was optimistically hoping to minimise risk. But yes, double trouble.

More to it, I do believe I have ability to make the purchase and remain cash flow positive as long as my outgoings are accurate... hence the thread.