Albert Park versus Oakleigh



From: Ten of Diamonds

Hi All,

Qu 1. Apart from land costs, would I be correct in saying that to build a two bedroom house in say Albert Park (Melb) would have roughly the same construction costs as to build the same house in say Oakleigh?

Qu 2. If this is so, then will the depreciation schedule for building and fittings be very similar for both houses, even though there would be possibly $300,000 difference in purchase cost (just guessing on figures here)?

Qu 3. As far as I can see, buying new properties has a massive advantage over buying older properties because of the huge write offs for depreciation. Am I missing something here? Why doesn't everyone buy new properties?

Look forward to your wisdoms...

Ten of Diamonds
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Reply: 1
From: Sergey Golovin

And also when you are buying new building, yes lots of depreciations but capital gain is not as big or impressive as with older once.

Reason is actually quite simple - every party who took part in that project made as much money as practically possible.

So, it will take some time for capital gain to stabilise and go "hand in hand" with other buildings in the area. I think.

Put simply - good depreciation in new building yes, capital gains maybe...depends where it is.

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Reply: 1.1
From: H T

I'd rather have my 2.5% gross return in APark with the growth potential that only the bayside has to offer versus the 5% ret. i could get in Oakleigh, together with some ok depreciation writeoffs.
Go cap. growth all the time if your a buy and hold dude like myself...

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