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Properties In Australia
To view our properties, make your provincial selection on the map above.
PURCHASING PROPERTY IN
AUSTRALIA
FAQ’S REGARDING THE PURCHASE OF AUSTRALIAN PROPERTY BY NON-RESIDENTS
HOW DO I ARRANGE THE FUNDS AND WHAT SORT
OF DEPOSIT DO I REQUIRE ?
We will make an application for you in Australia
for a 70% to 75% loan. You will require access to 25% to 30% deposit
plus between 4% and 6% for costs.
There are 2 types of Loans :
1) Non residential for people who earn their money off shore. There is
no Debt Service Ratio (DSR) consideration with this.
You need to provide
a) Proof of identity
b) Proof of income
c) Proof of deposit
2) Residential for people who earn their money in Australia. As a non
residential
borrower you can revert to residential when you move to Australia and
you have
income there and an Australian drivers license. You will also be able to
use any
increased equity in the property and your own initial deposit to
purchase another
property.
There is D.S.R. consideration when borrowing in Australia up to 35% of
income
WHAT COSTS ARE INVOLVED ?
Every property we show you will have a breakdown of fees showing what
all the costs are for purchase. Units are approx 6%, and house and land
packages 4%, of the purchase price.
Once the property is completed you will have the following costs
1) Management and letting fee between 7.5% and 10% depending on which
state the property is in
2) Body corporate where applicable
3) Council rates
4) Insurances
5) Mortgage payments
On a 30% deposit most properties will have a shortfall between the
rental income and the outgoings for the first few years.
You can claim any shortfall and costs involved and also claim
depreciation of construction, depreciation of fixtures and fittings,
inspections costs and half of
the Acquisition fees. A typical property will give approximately $20,000
tax claims which can be carried forward until either eventual relocation
to Australia or offset against capital gains tax.
WHO WILL LOOK AFTER MY PROPERTY ?
We will appoint a Licensed Property Manager.
With units the people managing it will have bought the Management Rights
and have
paid Millions of dollars in most instances. This gives them a unit and
an office and they will be paid a wage by the Body Corporate and earn
the management and letting fee which is between 7.5% and 10% depending
on which state.
They are responsible for the ongoing management and daily operation of
the complex
They will screen the tenant and do the necessary checks
They will collect the rent money and deposit it in your Australian bank
account.
They will deduct their management fee before banking the money into your
account.
The lender will have an automatic debit authority to take the monthly
payment from your account.
Holiday lettings management fee is higher at 12%.
With house and land packages the Property Manager will have an office
approx 15 minutes from your property and they will arrange the mowing of
the lawn and take it from the rental income. Or alternatively, they will
let the tenant do the lawns and charge a little less rental.
WHICH AREAS ARE THE BEST TO BUY IN?
The points to consider when investing in Property are
HOT SPOTS:
1) Economy of the area
2) Development and Infrastructure
3) Property cycles ( where it is on the cycle)
4) Demand for property and supply available
5) Employment
6) Population Growth
Our ongoing research of the Australian market place ensures that you
will be able to achieve maximum profit and takes the guess work out of
it.
WHAT TYPE OF PROPERTY CAN I BUY ?
You can buy any property as long as it is new and not second hand.
WHAT TYPE OF PERSON WILL BE MY TENANT ?
35% of all Australians rent their home. You will have a wide range of
tenant selection as we source areas that have more demand than supply.
If you name any industry that
is where the tenants will come from. We also look at the affordability
of the area you invest into. New job creation and employment is a very
important issue we look at when selecting properties.
Queensland creates more work than any other state as it charges less pay
roll tax than other states so companies relocate their to make more
profit, hence creating more jobs.
WHAT RESTRICTIONS DO I HAVE ?
Unless you have Permanent Residence (PR) or Australian Citizenship, you
can only buy new property and not second hand. When you sell you must
sell back to an Australian and not another foreign person. Australians
also cannot sell their homes to people who do not have PR. The only
exception to the above laws is Integrated Resort status, which will be a
resort with a golf club facility. There are only 3 in the country now.
HOW MUCH RENT WILL I RECEIVE AND HOW MUCH WILL IT INCREASE ?
The average rental yield is approx 4% gross. Some corporate rentals do
have higher with up to 5 % net. The rental increase depends on where the
cycle is. When the market is peaking rents don’t usually catch up to the
higher prices for some time, and
then they start to increase. In Queensland for year 2007, rents are
expected to increase by 30%. Holiday apartments may give more gross
income but the costs are higher so it results in the same net result.
WHAT ARE THE PITFALLS TO AVOID ?
First and foremost, do not confuse your buying motive. Determine if the
property is to live in or for investment purpose. Make sure that you
take Landlord Protection Insurance. Do not try to manage it yourself. Do
not buy something using non Australian thinking. For example, South
Africans will tend to want to buy into a security complex as that is
important in their country but not in most parts of Australia. Know the
mindset of the people in the area as the prime consideration.
Follow the market. Don’t try to ask for more than fair market rental.
Communicate with the property management.
