Download - Landlords' Newsletter May 2013
In this edition: How long will it take for your prop-erty to rent? Property Investors Save $$$ By Scrapping… How To End a Tenancy – Notice Pe-riods in QLD Rental Property Save $$$ Going Green And Keep Your Home Snug From Winter Winds
May 2013
Dollars in Your Pocket… But Where Are You Going to Go? A Selection of Properties Recently Leased Quote Calendar of Events
Wow -May already and head-
ing towards winter... the months
just seem to fly by but guess
that's a positive sign that we're
so busy at work that entire sea-
sons whiz past the window!
This week, we're delighted
to welcome Tania Christian to
our ever-expanding property
management team.
Helen continues to lead the de-
partment and will remain your
point of contact unless other-
wise notified. Frankly, the rent-
al market is not flying at the mo-
ment so more than ever renting
properties comes down to the
crucial combined factors of:
price war and beauty contest.
If your property is up for rent or
will be soon please consider
your price and presentation
carefully as the average time to
rent a property in Brisbane has
pushed out to a month now.
Floorplans and professional
photos are becoming the norm
and worth your consideration if
you don't have them already.
I hope you are enjoying the
beautiful weather as we are.
Glorious sunshine and gor-
geous autumn foliage makes it
so much lovelier to be in out
and out of houses at this time of
year.
Thanks for your continued sup-
port .
Wishing you health, wealth and
happiness,
Christina
Price war and beauty contest for rental properties...
www.propertyrentalsbrisbane.com FREE Information Guide For Landlords & Tenants
How long will it take for your property to rent? That of course depends on the time of the year so here are the latest statistics for March.
BRISBANE STATISTICS The Market
Source: rentfind.com.au
Brisbane, QLD March 2013 Annual Change
Median Weekly Rent - House $395 0.0% change
Median Weekly Rent - Unit/Apartment
$380 2.7% increase
Days on Market (Avg) 30.3 4.2 decrease
Days Vacant (Avg) 19.0 4.2 decrease
Property Investors Save $$$
By Scrapping…
Scrapping is the removal and dis-
posal of any potentially deprecia-
ble assets from an investment
property.
In other words, the demolition of
any existing structure or fixture
onsite that would have been eligi-
ble to claim deductions for depre-
ciation (Division 40) or building
write off allowance (Division 43).
When renovating, there are sig-
nificant tax advantages that can
be generated over and above.
Prior to demolition or renovation,
many investment property own-
ers remain unaware that the old
assets within their property can
be worth thousands of dollars.
When these old assets (like car-
pet and hot water systems) are
replaced or ‘scrapped’, owners
may be entitled to claim them as
a tax deduction.
How does an investor benefit
from scrapping?
Scrapping of existing structures
onsite is a very effective method
of obtaining tax deductions. Ad-
ditional tax credits are available
for investors who demolish or
dispose of existing buildings or
assets that produced income. In
the year the item is scrapped, the
written down value (WDV) can
be written off as a tax deduction.
www.propertyrentalsbrisbane.com FREE Information Guide For Landlords & Tenants
To calculate the scrapping value,
a Quantity Surveyor will identify
the items removed in the renova-
tion process.
Case Study
Jim purchased a sixty-year-old,
three-bedroom townhouse in
Paddington. In its pre-renovation
condition, the house contained
carpet, vinyl, blinds, an air condi-
tioner, old stove, hot water ser-
vice and light fittings.
When Jim learned about the po-
tential depreciation deductions
available in old, pre-renovated
properties, he decided to contact
BMT Tax Depreciation to enquire
about a depreciation schedule
including all the items which were
to be scrapped prior to starting
any work on the property.
BMT visited the site and conduct-
ed a full site inspection, taking
note of all of the items that could
be written off before they were
thrown out.
The following deductions were
obtained:
Jim then took the BMT Tax Depreciation Schedule to his Accountant
and claimed $6,270 in depreciation deductions that year in his personal
tax return. Over the following twelve months, Jim completed his reno-
vations, including an extension at the rear of the property. He again
contacted BMT Tax Depreciation to come and assess the renovated
property to achieve the maximum depreciation deductions. BMT Tax
Depreciation were able to complete a second depreciation schedule for
Jim, taking into consideration all new additions (stainless steel oven,
cook top and range hood, new carpet, air conditioning unit, etc) as well
as calculating the construction write-off allowance now available on the
extension.
Both Jim and his Accountant were impressed with the total depreciation
claim on the scrapped assets and renovated property of $16,000 in the
first year alone.
How is scrapping calculated?
The first depreciation schedule prepared by BMT Tax Depreciation is
undertaken prior to any renovation or refurbishment. BMT Tax Depreci-
ation prepares a depreciation schedule identifying the value of all plant
and equipment and qualifying capital expenditure contained within the
property.
A second schedule is then prepared by BMT Tax Depreciation after
completion of the renovation, identifying the value of all new plant and
equipment and capital expenditure within the property. The assets with-
in the building that are no longer present can be written off immediate-
ly. Scrapping is a complicated process that requires the expertise of a
specialist Quantity Surveyor such as BMT Tax Depreciation, in con-
junction with an Accountant.
www.propertyrentalsbrisbane.com FREE Information Guide For Landlords & Tenants
Why scrap items?
There are several reasons why
an item may be scrapped that
generally fall under the heading
‘not fit for purpose’. They include;
Obsolescence;
Functionally inadequate;
Dated style;
Original form was inappro-
priate or does not maximise the
form and function of the property;
or
Additional value to the own-
er is obtained from a renovation.
A valuation of all items in a prop-
erty, as well as adequate photo-
graphic records, is required in
case of an audit by the Australian
Taxation Office.
The concepts outlined above can
provide the property investor with
a very attractive tool to maximise
the tax benefits available from
the refurbishment of an existing
building, both immediately and in
continued ownership. Substantial
deductions can be achieved
when the correct decisions are
made at purchase and during the
renovation process.
Either a tenant or an agent can
give notice to end a tenancy;
however certain rules and time-
lines must be adhered to.
A fixed term agreement means
that the tenant or resident will
stay until the end date and has
committed to pay rent until that
point. If either party wants to end
the agreement early they may
have to pay compensation and/or
remaining rent.
The minimum notice period a ten-
ant needs to give the lessor/
agent if they want to move out
when giving a Notice of intention
to leave (Form 13) is:
14 days or the end of the
tenancy (whichever is later)
without grounds under a
fixed term agreement
14 days without grounds
(no reason) under a period-
ic agreement
7 days for an unremedied
breach
5 days for an unremedied
breach for non-payment of
rent in a caravan park
7 days for non-compliance
with a Queensland Civil
BMT Tax Depreciation provide an
Australia-wide service on all
property types and are vastly ex-
perienced in identifying deduc-
tions for investment properties
prior to demolition and after they
have been re-built. Call the office
on 1300 728 726 for obligation-
free advice on your property sce-
nario.
Article Provided by BMT Tax Depre-
ciation.
Bradley Beer (B. Con. Mgt, AAIQS,
MRICS) is the Managing Director of
BMT Tax Depreciation.
Please contact 1300 728 726 or vis-
it www.bmtqs.com.au for an Austral-
ia wide service.
How To End a Tenancy –
Notice Periods in QLD Rent-
al Property
Tenancy law in Queensland re-
quires certain reasons and time
periods to be provided to end a
tenancy by either the tenant or
the lessor/agent. Following is an
outline of the required reasons
and notice periods. All notices
must be in writing.
Notice periods for ending a
tenancy
www.propertyrentalsbrisbane.com FREE Information Guide For Landlords & Tenants
the same day for non-
liveability
2 months for compulsory
acquisition
4 weeks for a sale contract
signed when the tenants
are on a periodic agree-
ment only
Mutual agreement (where
both parties agree on a cer-
tain date to end the tenan-
cy)
April 2013 This information has been
sourced from the RTA
www.rta.qld.gov.au with minor edit-
ing carried out by
www.realestateexcellence.com.au
Our agency is a member office of
Real Estate Excellence
and Administrative Tribunal
(QCAT) order
the same day for non-
livability
14 days for compulsory ac-
quisition
If the tenant doesn't give the cor-
rect amount of notice and use the
correct form, they may be subject
to a claim for compensation from
the lessor/agent.
The minimum notice period a les-
sor/agent must give a tenant if
they want them to leave when
giving a Notice to leave (Form
12) is:
2 months without grounds
(no reason) under a period-
ic agreement
2 months or the end of the
term (whichever is later)
without grounds under a
fixed term agreement
(cannot be earlier than the
end date of the agreement)
7 days for unremedied rent
arrears
14 days for an unremedied
breach
7 days for non-compliance
with a Queensland Civil
and Administrative Tribunal
(QCAT) order
rug ourselves up in warm protec-
tive clothing to beat the cold
when venturing outside, we can
wrap our homes with green
‘windcheaters’ to ward off the
chill.
Possibly the most effective way
to deflect winter winds is to plant
a barrier along the side of the
house where they are most prev-
alent. A hedge or a row of ever-
greens such as Yew or Box; or if
you prefer natives, try Wattle,
Banksia or Bottlebrushes.
An added bonus of the living
windbreak is that it will also pro-
vide protection for the garden
and warm spots for you to sit on
a sunny winter day. As a short-
term solution, erect a trellis or
bamboo screen in the garden so
that it breaks the flow of wind into
your house.
There are also things you can do
inside the house to deflect the
chilly winds of winter. If external
doors open directly into an open
room such as the living room, try
placing a barrier such as a book-
case or screen just inside the en-
trance. Again, plants will absorb
the flow and ‘mute’ it before it
reaches into the room. f your
Save $$$ Going Green And
Keep Your Home Snug From
Winter Winds
Winter is nearly here and will
soon be making its presence felt
with colder days and chilly
winds.
Do you find that no matter how
well you heat your house, an icy
blast blows in every time some-
one opens a door? Just as we
www.propertyrentalsbrisbane.com FREE Information Guide For Landlords & Tenants
trees and shrubs that have low
crowns. If snow tends to drift in
your area, plant low shrubs on
the windward side of your wind-
break. The shrubs will trap snow
before it blows next to your
home.
In addition to more distant wind-
breaks, planting shrubs, bushes,
and vines next to your house cre-
ates dead air spaces that insulate
your home in both winter and
summer. When planting, leave at
least 30 centimetres of space be-
tween full-grown plants and the
nearest wall.
Source : Quartile Property Network
(25 April 2013)
builder hands are stronger than
your green thumbs, you may con-
sider putting up walls around a
patio making it a porch, creating
a windbreak for the front or back
door. Using fibreglass or strong
structural glass can insulate the
area while still letting the light in.
Even running a simple wooden
screen a few metres from the
house will form a windbreak in
areas that are most exposed and
affected by the wind.
Basically, any type of windbreak
will work to lower the wind chill
near your home, which occurs
when wind speed lowers the out-
side temperature. For example, if
the outside temperature is -12°C
and the wind speed is 32 kilome-
tres per hour, the wind chill is -
31°C. A windbreak will reduce
wind speed for a distance of as
much as 30 times the wind-
break's height.
For maximum protection, plant
your windbreak at a distance
from your home of two to five
times the mature height of the
trees, so if there’s ever any high
winds strong enough to uproot
them, you have a buffer zone.
The best windbreaks block wind
close to the ground by using
One way to get around the prob-
lem is to rent your home back
from the buyers for the interim
period, though this will only suit if
they are not ready to move into
the house themselves.
It can also be costly if you have
to pay rent equal to the buyer's
per diem cost of owning your
home (principal, interest, taxes
and insurance). If you've owned
your home for a long time, your
mortgage amount could quite low
in comparison to the buyer's
mortgage, and your property tax-
es and insurance premium could
also be lower.
If this is the case, then rather
than pay a high cost to rent back
your home from the buyers, you
may be better off moving to an
interim rental. The cost of renting
will probably be less, particularly
if you're living in an area where
the rental market is soft.
The additional benefit of moving
to an interim rental is that you
won't feel pressured to buy a
home that doesn't suit your long-
term needs.
Source : Quartile Property Network
(28 February 2013)
Dollars in Your Pocket… But
Where Are You Going to
Go?
You’ve sold your house, but
haven’t yet found the one you
want to buy and live in – what are
your options now?
You’re in a great bargaining posi-
tion, because you now know ex-
actly how much equity you have
to work with, but if settlement
dates do not match you may
need to find another place to live
for a while.
3 June Public Holiday 15 May Mid Month Accounting 3 June End of Month Accounting
A Selection of Properties Recently Leased
Spring Hill House $530p.w.
2 bed, 2 bath, 1 car accommodation
Quote
“Do not wait to strike till the iron is hot; but make it hot
by striking.”
-- William B. Sprague
Hawthorne Unit $630 p.w.
4 bed, 2 bath, 2 car accommodation
RE/MAX Profile Real Estate 141 Boundary Road TEL 07 3510 5221 FAX 07 3876 5544
www.profilerealestate.com.au Bardon QLD 4065 TEL 07 3510 5227 Helen [email protected]
www.propertyrentalsbrisbane.com PO Box 388, Paddington, 4064 Chelsea [email protected]
Errors & Omissions: These details have been prepared by us on information we have obtained and while we trust it to be correct, is not guaranteed by us and you should rely on your own enquiries.
Milton Unit $350 p.w.
1 bed, 1 bath, 1 car accommodation
Calendar of Events