depreciation: pre-1985 apartments

[trinity168]

depreciation: pre-1985 apartments

Decided to get into the property market, via investment, rather than purchasing our own place. We had a look last weekend at some properies in Westmead, on one hand, there were these old properties that were pre-1985, and the other, 8-10 year olds. The pre-1985, with a little love, I thought looked way better than the 8-10year olds. The price range for these apartments is right about the same for 2 bedders with LUG. My concern is, is it correct that you don't get depreciate for pre-1985 apartments? Does it highly affect your decision to purchase a pre-1985 apartment?

Our goal is long term hold of properties.


Thank you for your inputs.

 

[Jamie M]

No, you can still claim depreciation on pre 85 stock (just not building). Check out one of the online depreciation calcs - it'll give you an idea of how much you could depreciate.

Cheers

Jamie

 

[The Y-man]

We've got QS reports done on 60's apartments - there's a lot of stuff in there that can be depreciated (assuming they have been replaced since the 60's!!!) - things like carpet, light fittings, window furnishing, toilets, kitchen, bathroom can all have potential depreciation left in them.

The Y-man

 

[depreciator]

I don't reckon depreciation should be a major factor in a purchase decision. It's just something useful to assist with holding costs.

Scott

 

[Peter_Tersteeg]

I've yet to see a depreciation report that didn't pay for itself several times over, regardless of the age of the building.

 

[trinity168]

thanks so much for your inputs, much appreciated.

 

[cadence]

I've yet to see a depreciation report that didn't pay for itself several times over, regardless of the age of the building.

Even for unit/house built in 1970s??? If so, I better look into this. I've always assumed this was a dead end as it has been over 25 years.

 

[veebeeseewee]

We've got QS reports done on 60's apartments - there's a lot of stuff in there that can be depreciated (assuming they have been replaced since the 60's!!!) - things like carpet, light fittings, window furnishing, toilets, kitchen, bathroom can all have potential depreciation left in them.

The Y-man

i assume this doesnt include building itself, right?

 

[The Y-man]

i assume this doesnt include building itself, right?

Correct - unless there has been improvements done.

The Y-man

 

[veebeeseewee]

Correct - unless there has been improvements done.

The Y-man

Thanks, Y-man.

What if there were improvements done like carport, rear verandah and garage, but have no idea when it was done (let's say even the vendor has no idea), is there any way to find out?

 

[travelbug]

Even for unit/house built in 1970s??? If so, I better look into this. I've always assumed this was a dead end as it has been over 25 years.

Yes. I have reports on all mine (bar one) and I have received more than the cost of the report in the first year for every one. Most were built before the 70's.

 

[depreciator]

What if there were improvements done like carport, rear verandah and garage, but have no idea when it was done (let's say even the vendor has no idea), is there any way to find out?

With that sort of work, they may have got council permission. See what they can tell you. Neighbours are also often a good source of knowledge.

 

[cadence]

Yes. I have reports on all mine (bar one) and I have received more than the cost of the report in the first year for every one. Most were built before the 70's.

travelbug who do you use?

 

[veebeeseewee]

With that sort of work, they may have got council permission. See what they can tell you. Neighbours are also often a good source of knowledge.

Thanks, Scott. I'll check with the council on Mon.

 

[Propertunity]

What if there were improvements done like carport, rear verandah and garage, but have no idea when it was done (let's say even the vendor has no idea), is there any way to find out?

If its still a unit we are talking about, you can make an appointment with the strata manager to go through the strata records. You should be able to see when these things were done plus you'd see originals of the invoices involved.

All it will cost you is yout time and about $50 for what the strata managing agent charges you for the room they provide and the photocopies you want.

 

[travelbug]

travelbug who do you use?

I use Depreciator (posted here). I was very happy with the service and price of the first one so kept going back.

Thanks Scott.

 

[veebeeseewee]

With that sort of work, they may have got council permission. See what they can tell you. Neighbours are also often a good source of knowledge.

I've called the council and on their record they only found two things: 2004 - application to change the office (a childcare centre) to a house; 2006 - dwelling application. There might have older applications but they don't keep record for too long. I then checked with my RE agent and she said the improvement must have been done before 2002 as the vendors only bought this house in 2002 and they didn't do anything to this house. It doesn't look like a childcare centre to me at all nor a new house by the way. It's definitely was built in 1966. I might have to give the council another call to speak to another person to double check. (I've triple checked the address with the lady I spoke to this morning though).

You are right, neighbours are a good source too, but we'll have to see if we've got luck to come across with any of the neighbours when we are there.

If its still a unit we are talking about, you can make an appointment with the strata manager to go through the strata records. You should be able to see when these things were done plus you'd see originals of the invoices involved.

All it will cost you is yout time and about $50 for what the strata managing agent charges you for the room they provide and the photocopies you want.

Unfortunately mine is a free standing house, not a unit. Thanks anyway, Propertunity!

 

[sam_oz]

I don't reckon depreciation should be a major factor in a purchase decision. It's just something useful to assist with holding costs.

Scott

Hi mate

I have slightly different case here

I intent to buy a property ( 4 BED/2BATH) which is 5 years old . But the current owner and RE agent said that there is no depreciation report and claim on this property so far

I am wondering , can I ask someone to access and make the report to add it to tax benifit or how do I go with this ?

I will be able to claim for last 5 years together at one time or I will start from the date I buy this property

Cheers

 

[depreciator]

Sam, you can only claim depreciation from when you own the property and make it available for rent. What the previous owner might have done is irrelevant.

So veebee, it's a pre 85 property with a few renos. If you have no luck with the neighbours but happen to have some photos, I can get someone to have a look.

Scott

 

[veebeeseewee]

So veebee, it's a pre 85 property with a few renos. If you have no luck with the neighbours but happen to have some photos, I can get someone to have a look.Scott

Thanks, Scott. Still no luck with the neighbours so far.. the street seems to be quite quiet everytime we visited. I'll send some photos through this Fri/Sat cuz settlement will be this Fri.