Commercial use of a residential property

[NickB]

Just wondering if anyone out owns a residential property i.e. house which is located in a commerial zoned area, and rents / leases the property to a commercial tenant.

What are the returns like?
How much did it cost to convert?
Did you use a commercial lease agreement or a residential one?
Did you need any additional approvals from council?
What are the benefits?
What are the negatives?

I have been eyeing off a couple of houses on a main road located within a commercial zoned area and am trying to work out the feasibility of such an idea.

Cheers,
Nick

 

[abbruzzi]

Hi Nick,

I bought a residential house in a residential area with a council approved commercial tenant.

All I have to say is be very aware of G.S.T. and how it relates to your situation when you buy and also if you sell down the track.

Be aware of if the vendor is registered for GST and if you are registered for GST. Can look this up on www.asic.gov.au

I found the best resource outside the ATO being the book RENTON, Understanding Investment Property. Chapter on GST.

Also CCH Taxation guide. Chatpter on GST is short but helpful.

Abbruzzi

 

[NickB]

Thanks for the heads up on GST.
I was hoping that GST wouldn't be applicable to purchase and sale, but now that I think about, I guess it will be.
Will check though.
Cheers

 

[pursefattener]

Hi Nick

I have a property that was an infant welfare centre in a regional centre near where I live . At the moment it is being used as a residential and the lease runs out later in the year ....

My PM had been aproached by a local architechs firm who are interested in leaseing as a business premises etc . So we will spend 15k on some renovations and lease it on a 3 by 3 with a net return of 1,800 per month .

I havn't got this nailed to the floor yet . We just have a negotiated agreement at this stage .

We will draw our own lease up .