Estimating Building Depreciation for a property

[clackers]

Hi Everyone

I'm interested in buying my first IP and I've got a couple of questions regarding estimating the building/capital depreciation. I need this to work out if this property will be close to being +ve cash flow (attractive) or -ve geared (not so attractive for me)

a. How do I confirm the REA's claim that it was actually built in 1990 (since if it was built prior to 1985 there is no depreciation available). It is strata titled so there should be other capital works that can be claimed (such as common driveway)

b. How do I confirm the amount of the depreciation if I don't know the building costs back in 1990? I seriously doubt the REA has that (although I haven't asked).

c. Is this something I should be 100% certain on before making an offer? ie do most of you out there get a quantity surveyor on site before making an offer

Any advice will be helpful.

Thanks.

 

[twobobsworth]

Hi Clackers,

I have a 2 bed townhouse that was built in 1991 which I bought it in 2007.

Total deperciation is a bit over $5K per year.

Not sure about WA, but in NSW the contract includes the strata plan registration papers and development statements which have the dates.

 

[clackers]

Thats great twobobsworth.

For future searches of suitable IPs is there really a way to know the depreciation amount tho? ie all the property books talk about its importance, but none seem to provide an accurate way of working out a ball park estimate.

 

[twobobsworth]

Depreciation is the cream. If I can't afford to buy without it, I shouldn't be buying at all.

Have a read up on these sites

http://www.depreciator.com.au
http://www.deppro.com.au

 

[depreciator]

Depreciation is the cream. If I can't afford to buy without it, I shouldn't be buying at all.

I agree.

Clackers, the local council might be able to assist with a date.

With older properties, that quality of the kitchen appliances, carpet etc is the key to decent depreciation. We've got a pay per use calculator on out site. It's pretty accurate, but takes about 15 minutes to work through (ones that less time tend to be less accurate).

If you send me internal and external photos, I can get a QS to work out a rough estimate.

Scott