Crunch The Numbers And Save On Your Real Estate Investment Opportunity
Whether you are looking at buying into your first or next real estate investment opportunity, make sure to crunch the numbers accurately. Your next real estate opportunity may actually be affordable if property depreciation is claimed. As an investor you should analyse the potential rental return of the real estate investment opportunity, the property’s location in proximity to local community facilities such as schools and shopping centres. Astute investors will also take a step back in time and consider the location’s historical growth.
Also examine tax deductible costs and other deductions such as property management fees, rates, interest, repairs, maintenance, and depreciation associated with owning the property.
It is far too common that investors fail to consider the financial benefit of claiming depreciation prior to deciding on their next real estate investment opportunity. The following example shows how one property investor identified an additional yearly cash flow of $4,992 from property depreciation.
Clever Investor Example - Real Estate Investment Opportunity
A clever investor was considering purchasing a ten year old house priced at $560,000.
They did some initial research and requested a rental appraisal from their Property Manager on their real estate investment opportunity. This comprehensive homework revealed an estimated rental income of $530 per week, or $27,560 per year!
Our clever investor also conducted calculations into the estimated costs involved in owning the prospective investment property including interest rates, property management fees, rates, repairs and maintenance costs. The expenses totaled $36,060 per annum.
By contacting BMT Tax Depreciation for a free assessment of the likely depreciation deductions our clever investor found that they would be able to claim roughly $13,500 in depreciation over the duration of their first year.