Depreciation

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From: Trina Blum


Hi,

I am intending on buying my first IP next year and have looked at a demo of the PIA software.

My question is regarding the depreciation aspect. Does the software automatically work out the depreciation on the buildings etc by me putting in the date the building was built, or do I have to know myself what the depreciation rate/percentage is?

I am a real novice as far as actually working out cashflow for a property - I don't know how so I am looking for a programme that I can enter in all the information I know of for a unit I may be considering and the programme will work out for me if it is positive or negative cashflow and the amount.

Does the PIA software do this?

Trina
 
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From: Webmaster (Somersoft)


The PIA will give you the answers you want, but the answers will only be as good as the information you give it. The building depreciation depends on more than just the date of construction, so that would not be sufficient information for PIA to give you all the answers. It depends not only on the date of construction but also the type of building (residential, commercial or motel type) and the original construction cost. The program will assume a standard 2.5% rate and a construction cost of half the purchase price unless you tell it otherwise (Building Depreciation dialog). The help button "?" will reveal all of the necessary background information on dates, building types and rates if you need it.
 
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