Is it worth to hold?

[letitbe]

Hi, I need some input.

How to determine if the IP is worth to hold on?

The IP is in growth area with great facilities, good atmosphere and community etc etc.

But the only problem is the rental prices is quite low now (because a lot of new properties in the area built up).

What I see now, the infrastructure is lack behind and people are questioning the council or state support. What do you guys think?

 

[Jamie M]

Is there anything you can do to increase the rent and lower the holding costs? Allow pets? A few basic cosmetic renos? Are you claiming depreciation?

Sounds like you're keen to hold it - you just find it hard to justify the holding costs.

Cheers

Jamie

 

[Bigtone]

Hi, I need some input.

How to determine if the IP is worth to hold on?

The IP is in growth area with great facilities, good atmosphere and community etc etc.

But the only problem is the rental prices is quite low now (because a lot of new properties in the area built up).

What I see now, the infrastructure is lack behind and people are questioning the council or state support. What do you guys think?

growth area as in lots of new houses and land? if so i would sell.

if growth area you mean highly likley for good capital growth then i would keep it

u might as well just tell us where it is and you will get lots of opinions

 

[letitbe]

Is there anything you can do to increase the rent and lower the holding costs? Allow pets? A few basic cosmetic renos? Are you claiming depreciation?

Sounds like you're keen to hold it - you just find it hard to justify the holding costs.

Yes, actually I would like to keep it. If I pull out now, I don't think I'm able to buy similar property again with the same price.

That's right, council, water, interest etc. The IP is near new house.

Will claiming depreciation increase my tax return? I can't claim the building cost because it's less than 240K.

growth area as in lots of new houses and land? if so i would sell.

if growth area you mean highly likley for good capital growth then i would keep it

u might as well just tell us where it is and you will get lots of opinions

Yes, it's within new development area in west of Melbourne.

Well, it could have good capital growth in the future (and as long as the infrastructure is upgraded, the economic is not stale etc)

 

[Bigtone]

Will claiming depreciation increase my tax return? I can't claim the building cost because it's less than 240K. Less than $240k what does that matter? yu need to get a depreciation report done asap




Yes, it's within new development area in west of Melbourne.

Well, it could have good capital growth in the future (and as long as the infrastructure is upgraded, the economic is not stale etc)

i am not so confident of growth there myself,

 

[Aaron_C]

Is it Caroline Springs or Point Cook?

 

[Jamie M]

Will claiming depreciation increase my tax return?

Yes. If you decide to keep it - get a depreciation schedule drawn up.

Cheers

Jamie

 

[jonesy427]

i know it may seem simple this little thing i made up to work out what the CG has to be to make it worth while. just takes basic things into account.

 

[Stella]

We are wondering the same thing - our IP is in Raceview Qld & if we sold now would get somewhere between 0 - 30k (before selling costs) more than we paid 4 years ago. This wouldn't cover our holding costs & we would probably come out of it worse off.

 

[letitbe]

i know it may seem simple this little thing i made up to work out what the CG has to be to make it worth while. just takes basic things into account.

Thanks Jones, that really helpful.

But I don't understand why "depreciation" go under expenses? I thought depreciation will increase the tax deduction.

 

[evan1875]

depreciation = (non cash) deduction on rental income = less tax paid (= increase tax deduction)

same thing.

 

[jonesy427]

its essentially an expense but a non cash one.
my properties currently come out at -2% total. so i need an increase of 2% CG to be worth it.
like i said it is a very simple form that doesnt take into account everything, but it is pretty close.

 

[letitbe]

its essentially an expense but a non cash one.
my properties currently come out at -2% total. so i need an increase of 2% CG to be worth it.
like i said it is a very simple form that doesnt take into account everything, but it is pretty close.

Thanks again Jones and Evan, but How to estimate the depreciation? I don't have depreciation schedule for my property yet.



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