Land tax at 43% of Gross Rent

Well it all depends on your outlook. I have clients who only have properties in NSW and continue to buy them here even though it will be a huge land tax burden and their reasoning is that Sydney properties should grow faster than properties elsewhere and that even though they are paying more land tax they will still be ahead.

 

There are many experts, but what matters is what is important to you and what is practical, or scary even maybe, how do you want to do things, what do you believe etc...

I suppose if someone is going to shoot it down, they should not be vague about it.

Would *you* like to lower your land tax exposure ? if yes, look at what many other skilled people have and are doing here, many discussions on this.

 

Right on TerryW. I love Sydney so much, but she loves sending me exorbitant bills every year. We have a complicated relationship. Hence I've had to find brides elsewhere around the country.

 

Yep. Land tax is a killer but so are council rates and water/sewerage (increasing fast) are also substantial.

We paid close on $50k last year. We owe another $5k as they made an error and dropped one of our block of units from the bill. I haven't told them yet. They will most probably hold me responsible for their error.

Just as a side note. We happen to own 3 townhouses all alike in the same complex. The complex is split over 3 stratas with 2 in one and 1 in another of the stratas. Anyway the land value on 2 of the townhouses is the same. The 3rd town house in the other strata has a land value about 1/2 the others. I phoned them ages ago to inform them of the difference and was told in no uncertain terms that the valuer general does not make a mistake. To this day they are still valued the same (with increases)

Back to our land tax bill. We receive 3 thresholds so that helps. The first is a personal one and the other 2 are company ones. We were only getting 1 company threshold for a while and then it dawned on us that the structure of the companies was sufficiently different to apply for the 2nd threshold. They would only refund 5 years back (as I remember).

I invested in the USA to lighten the tax load but they have a county tax that is basically double our council tax so pretty well approaches the same % as out land tax + council rates.

Moving forward I want to invest in more commercial type properties - factories, office or possibly shops interstate just to lighten the land tax load.

PS I originally started investing in units and blocks of units to get more rents to offset the individual land tax. This has work as proportionately ( property : land value and thus land tax) we do better per unit than per house.

 

Caselaw says otherwise!

 

Just remembered this old mate of mind, and he ended up selling the property. If he had kept it I think the value would have been about $3.5mil now.

 

He'd be crying in his beer

 

Depends what he did with the money.