Old Property VS New Property In Australia 2021 - What Is The Best Strategy To Build Wealth & Income?
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- Опубликовано: 3 июн 2024
- Whether to buy an established property or a brand new one is a decision investors have to make each time they purchase - so what do you need to know before you buy?
In this video we cover 7 factors looking at an unemotional view of the best investment strategy to discuss the pro's and con's.
0:00 - Intro
1:11 - Growth in Brand New Property
6:42 - What is the Land to Asset ratio?
7:48 - Depreciation of New property.
0:36 - Truth about Tenants in Brand New Property.
14:00 - Maintenance on Brand New Property.
15:40 - Can you Add Value to New Property.
16:50 - Lazy People Buy Brand New Property.
19:33 - Conclusion
20:19 - Outro
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Hey PK! Could you tell me the best suburbs in terms of growth and best suited for families in sydney .
@@ARCat_house yeah sure this is exactly what I help my clients with :)
Where can i contact you ? Need some help here please :)
@@ARCat_house for free advice join my fb group, for me personally it’s expensive, through my course consultingbypk.com.au
@@AusPropertyMasteryWithPK you should probably also talk about inflation adjust value of the house and factor in the front loading of interest rates. No one seems to talk about this to show how much value is really being created.
Cant believe I was about to make this mistake by subscribing to a similarx service that you just spoke about. I am blown away, appreciate this PK!
Cant believe I was about to make this mistake by subscribing to a similar service that you just spoke about. I am blown away, appreciate this PK!
Just watched this and looked up the statistics on Pimpama and this guy is spot on.
The prices for a new home there today are lower than the original house and land package.
It saw a drop a large drop in rents as well and has a 2% vacancy rate (Very high) during a rental crisis 😳.
60% of properties are rented (very high) so as he said ALOT OF COMPETITION.
Guess I juat found my new property Guru.
🙏🏼 thank you for sharing this piece!!!
thanks PK, your vlogs are always full of wisdom to take in
Thanks a lot PK. Great job
Awesome content PK! This is the real deal👍👍
Thanks. Great info.
Excellent thought-provoking succinct info to share with less knowledgable people who need to hear stuff from a third party instead of from ourselves!
Awesome explanation thanks PK❤
Great vedio PK. You are a gem.
Thankyou bro for the amazing feed back really appreciate it👌
Pleasure!
Great content. This needed to be said
I know right ..
Good advise PK
The most helpful vidoe on property investment
Great advice
Love this and couldn’t agree more 👏
Thanks mate
Great video. Just found your Chanel and I think it is awesome!
🙏🏼
Thanks PK. This was helpful.
🙏🏼
This is very informative. Thanks PK
Thank you 🙏🏼
Very informative, we need more videos like this in social media. Thanks for sharing this 😊
Thanks so much!
Good information, you are 100% correct about these property marketers offering training. The give you all the strategies you can hear anywhere on the net and claim it to be their own intellectual property.
Very true.. such a shame that despite all this free content people still get sucked in
Thank you PK
Great content ! My takeaway is at 12:22-12.23 mark . The right area / location is usually the key as PK alluded . New property in the right area should also perform well compared to established property in the wrong area . Keep up the good work Pk.
Thank you PK 🤟🏾
Pleasure!
All new construction, the one who is making money is the developer. They are selling you a house at retail prices. They make money on every 2x4 they sell you. The only way to make money is to wait for the suburb to appreciate. Even then inflation will be a head wind.
Hi PK, great video. What data sources can I use to analyze the data factors you’ve touched upon?
*It depends on the location of the new property. There are instances that the new property could be in the same location but has bigger area, or it could be in a more strategic location and has a bigger area etc.*
Hi PK great video. On Pimpama, so currently it is one of the fastest growing suburbs in QLD. There used to be a lot of land before but not anymore - the suburb is strategically placed between two major cities.
"Fastest growing"
It's called a bubble as he explained.
Go look up the statistics on Pimpama today.
Everything he said was spot on.
The suburb has seen a financial loss in house and rent prices in the last 12 months. With a high 2% vacancy rate. 60% rental suburb with high competition.
I hear you PK, and I'm aware of the points you mentioned. I still went ahead with building a new home for investment, and renting out individual rooms to maximise yeild. Main reason is due to my long term goal as I don't plan to sell anytime soon. Over time, all properties will increase, hopefully double in 15-20 years time. I find that land size and being able to customise your floor plan to be rent friendly and maximise living space, provides me a few comforts in my risk evaluation. 1st, attracting renters is quite beneficial especiallyimportant in the downturn cycle. For example, where to strategically place the toilet, as no one likes their bed head next to a flushing toilet. Also having larger bedrooms and smaller living space, plus ensuring walk in pantry is large to accommodate everyone in the house. 2ndly At the same time, I'm able to stretch my living space to 260sqm, which is above average space for a single 4x2. I pay a bit more now per sqm, but I hypothesise the living space used to calculate and evaluate upon its eventual sale will compound. I compare this to current homes and it just doesnt provide me with the same benefits for the same price.
However, I definitely see your strategy for an investment property I want to sell off in the shorter term. I might look at doing this in the next investment property where I look to hold for shorter term to hopefully make a profit and pay down my mortgage sooner.
Explain great
Great content mate. It is happening a lot now
Yeah
I have a gut feeling that you are someone I can trust and able to recommend to my sons...one of whom is looking to sell and buy when/if properties start to come back onto the market place.
Thank you 🙏🏼
Hi PK, pls elaborate more about your statement regarding paying ATO after utilising depreciation from brand new property.
Thanks
This video is gold
Thanks man
PK IS GOOD TEACHER, VERYWELL SAID
🙏🏼
Wow wish I found you 4 months ago before I purchased my 3 property brand new studio apartment, dam still learning the hard way
Oh no!
Another important factor described in favour of new properties especially the H&L package is low stamp duty, as in most cases the stamp duty is only on the land. If we are looking for a 600 K property, the stamp duty can be a big factor, often the determining factor for someone trying to buy their first IP
Very informative and in a realistic way unlike others.
How about property price in QLD and NSW in coming years with predictions of increased flood because of climate change (It already showed the signs)? Better to invest in VIC, SA and WA?
Hey PK, just found your channel ad I'm really enjoying your content 🙏
Please let me know your thoughts about buying property as 50+ year olds? Maybe in smsf?
Hey PK, this is really really amazing. I just discovered your channel today and seen 3 videos. I almost pulled the trigger to buy an off plan town house in Taigum but thanks to you, I'll work hard and find better options.
However, you have amother video saying town houses can be a good option. What do u think about a new build in Taigum? Main reason I wanted to do that was to tap into the 30k first home grant. What's your advice on that?
PK fully agree with not being able add as much value to new vs established, however what are your thoughts on buying/building a new duplex and then subdividing on completion to add value to each half?
I work in the industry and i can confirm alot of this is correct..
Cheers
Chur
What is your take if the artificial increase of property price by builders is too high which is sufficent for 10 years. Just to name tallawong, schofileds , riverstone, box hill, marsden park etc etc
In old property can we claim tax benefits of setup cost which one can claim the whole amount in 5 years in case of new property ? Also depreciation of building like 2.5% every year and fixtures ? Kindly advise . Thanks
Hey PK, can you do a similar comparison video of new build vs existing property in Auckland, New Zealand context please ?
Please do PK....I need advice asap.
@PK is $500O maintenance allowance annually on a 50-year-old property normal?
I'm subdiving a plot of land to build 3 townhouses. After completion, these 3 THs should generate more than enough rental to cover the interest and create positive cash flow with depreciation.
Is it a good idea to hold them? Or i'm better off selling them for capital gain
Hi PK I Caught with the Depreciation with the ATO to the tune of 50K
Ouch.. it sucks when you don’t know about it initially !
8:10 I didn't understand about paying back depreciation to the ATO
Which suburb are good for investment in Brisbane? 😊
Great video, thanks PK, can you please give me some advise? Do you think it is better of buying an investment porperry than buying ny first home, like buying a land first then eventually build a house ? I need some clear guidance here. Thank you
Hi I work in real-estate, here's some advice I guess based on what I'd do. If your currently renting, buy something you like that's affordable and will appreciate (preferably house on some land so you get cap growth as well). If your comfortable living with parents or whatever, then definitely by an investment. Buying land isn't going to make you any money and will cost you a lot until you put a house on it. So consider buying a 2-3 bedroom unit/townhouse or preferably house and land (land goes up in value but is expensive in brisbane now). Consider we are losing 20% of money in the bank a year from inflation, investing in property is a must to stop your money becoming worthless
Nice Video. It cleared some of my doubts regarding new vs old apartments.
What do you think about brand new apartments (not off the plan) in suburbs around Parramatta cbd like Westmead, north parramatta, Merrylands etc. Will they also experience same issues as brand new apartments in New suburbs where there is no shortage of land?
I just did a video on a similar thing 3 days ago on that!
Great video PK. I guess I am late to the party. Can you give me some advice, I am a first home buyer and was looking to buy a property in Melton area near Melbourne. I am confused if I should go for house and land package or and existing property. Also if I should consider investing or rather buying home to live in.
I can’t give personal advice here but I’ve done vids on those exact q’s!
@@AusPropertyMasteryWithPK can you share me link to the videos please
PK can you please elaborate on your point about having to lump sum paying the depreciation back to the ATO when you sell the property?
I’ve never heard of that rule so could you please clarify? Thanjs
It gets added to your capital gains tax
@@AusPropertyMasteryWithPK Thanks for the reply.
OK so it reduces the cost base and therefore is influencing an increased CGT Liability.
But if you hold the property for greater than 12months you get the 50% CGT discount right? Would that mean you're only losing 50% of the depreciation you previously paid?
Isn't that still a reasonably positive outcome to have that net 50% back in positive cashflow over the life of the asset?
@@splinter1012 that’s correct. The sub point is don’t invest for depreciation alone! New h&l generally underperform in growth :)
@@AusPropertyMasteryWithPK Thanks again PK all makes sense. And definitely agree on the sub-point you're making . ultimately the fundamentals of investing and due diligence still apply whether you're buying established or off plan.
You still need to do your homework, research and figurework regardless.
I live outer suburbs through choice. Wanted bigger block of land. Not really an option inner city
Same I prefer small ass footprint of the building but bigger open yard or land...
Are you specifically referring to NEW house and land developments? What about NEW townhouses etc. in proven and more established areas?
Hi pk I already had i property (house )on canberra and again I want to buy next house on north adeilade can u please suggest any specific suburb at this moment I am thinking around 400k .
That’s what I help my clients with
Maintenance expenses get higher every year....After 10 years everything breaks down and then u have to repair according to new building codes....good luck with that
I have more than 10, maintenance cost $1500 per year on average, first was bought more than 10 years ago
Great content as usual PK. HOwever what i saw from last year if bit different. If i see in Sydney area, last year H&L pkg land values was for around 400-500k, early this year it was around 500-600 k for appx 375sqm plot. Now after 6 months its selling for slightly over 800K. Hows that happening? to be specific i am talking about Box hill area where there is huge land availability and no basic amenities yet like school, shopping complex, transport etc.
Rising tide lifts all ships. Where the fundamental are bad or data is not good, that is where will correct the most post boom :)
@@AusPropertyMasteryWithPK what I have seen is such properties are owner occupied so they refinance and take that money out to invest elsewhere so on a correction it is still fine as they are planning to stay longer. They will ride that cycle and in long term it works out. Do you see any problem in it? Still H/L package in Sydney sounds a good deal?
@@madhutsb2002 I wouldn’t touch sydney at this point
Hey PK thanks for the Video
Just asking I’m about to buy my first property
What do you recommend regarding the age of property, how far should I go the age of property 30, 20 ?
Hi PK, So you mentioned 7 factors, but don't think you are covering the "Govt incentive" factor in the video. Can you shed some light? Thanks
even better is off the plan apartments...
you get all the downsides of a new property..plus all the downsides of having no land :(
this is so painful to watch after having made all the mistakes already
How’s Thornlie in perth for investment?
Pretty good
@@AusPropertyMasteryWithPK market has moved quite a bit there already. May be 10-15% in last six months. Getting a bit riskier now, buying at inflated price.
I prefer Huntingdale now, closer side of Thornlie as a good pocket to invest. Much better rates, better owner occupied percentage, same median price suburb letting you buy cheap due to lesser competition. I started running away from places where it already got very popular.
I wish you write a book so I can just go and have a read to help me with my investment
I have a course
All good but the depreciation bit is incorrect. Depreciation comes off your cost base, you then pay tax on half the gain then tax at about 40%, so you will pay back about half of the depreciation later
Lol, 1 quarter not half. My bad.
So we hold a property for 20 years and have $1m capital growth. That’s a bad idea because we would have to pay $45k of the $1m profit back to the ATO?
Please have a listen again, I think you’ve not caught the idea
This is exactly what I think about property investment companies.
However, PK what's you role? What do you get from helping/educating people about real estate?
I like your videos, it's simple and real.
Thanks mate, this is what I do consultingbypk.com.au/
How old property is good?
Depends on its build quality etc.. but up to or around 35 .. but depends on Reno’s etc
Hi PK I bought a freestanding townhouse 7 years in kellyville Ridge at $685,000. Now it worth about $950k to $1 million. Should i sell it and then buy a house with higher land value? Thanks
Pretty great buy cause whole of Sydney boomed! I can’t give personal advice here sorry
In same area, townhouse can never beat house for capital gain
Already had 2 carrots in my bucket😭
Sending this video to Scott from Freedom Investments. This is clear defamation!
Ha ha, just kidding...
So many freedoms. Facts are facts hey
buy the worst property on the best street
8:10..where is that rule defined on ATO? No one seems to know about this? not even CAs?
Just google it. Or go to the ato website. Or ask your accountant
@@AusPropertyMasteryWithPK Are you saying its not explicit but implicit...for instance If i bought a property for 500K in 2018...and paid 30K in stampduty + costs...so my property cost is 530K...now i claimed depreciation of 15K in 3 years...so the cost of my property becomes 515K..now when I sell it for 550K.. I am making a profit of 35K and "not" 20K (as would have happend with original price)...out of which I will get a 50% discount since I held my property for more than 12 months so my CGT is on 17.5K...but this CGT also factored in the reduced price of the property since I already claimed depreciation and thus the logic?
@@ahmadkumardsouza3262 any deprecation claimed gets added to capital gains tax
@@AusPropertyMasteryWithPK So technically depreciation claimed or not claimed doesnt really make a difference in the end....its just a matter of haveing extra cash flow when you claim it...but the CGT nullifies it in the end
@@ahmadkumardsouza3262 short term gain for long term pain
Amazing and very informative video mate. this is exactly what I am trying to research on these days on QLD PROPERTY and its full of home and lad packages. According to how you work what suburbs you will suggest under $500k in QLD preferably within 40-45kms from brisbane CBD. Redbank Plains, logan, north lakes , burpegary, springfiled lakes, goodna? Hoping to get excepted on your Facebook page
Hey I don’t recommend ANY of the suburbs or areas above..
@@AusPropertyMasteryWithPK yeh i realised after i watched your QLD video. Waiting to get accepted on your facebook page ad lookig forward to get your assistance. Thanks so much :)
@@harshsingh9030 cool, we approve group request every Saturday
Cant believe I was about to make this mistake by subscribing to a similarx service that you just spoke about. I am blown away, appreciate this PK!