Longrun training notes.docx - MODULE – 1 For Property...

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MODULE – 1For Property UpdatesSydneytoday.com(Chinese Website)PropertyObserver.com(English website)Auction Clearance Rate – indicates the rate of the sold properties through auction (ratedevery week)Property Value – FactorsoLocationoView/orientation (North – city and sunshine / South)oInternal FinishOld vs New Properties?OLDNEWoCheaperoCan move in straight awayoCan see the propertyoModern finish and appliancesoFacilities to enjoyoDepreciation for investorsoMore choicesoMore rentoLess maintenance/ less strataoForeign clients can buyoMore cashflow on rising marketoSell it before settlement to cash outNote: the higher the apartment, the more expensive it gets. (Size varies).Note: Property in Sydney depreciatesbut the sale price increases.Depreciation – good for investors to attain tax-deductExample – (off the plan investment)o2 beds, 2 baths, 2 carparks. Lv 10, North F, Mascoto$1,000,000 Contract Priceo2 years prior to completionoAnnual growth 5%oInterest rate 2% cash depositSOL.o10% deposit when signing and exchanging the contract (year 0) - $100,000
oInterest of the deposit $100,000 for 2 years = $100,000 x 2 years / 2 = $2,000(income to the buyer over 2 years = $2,000)o$1,000,000 x 5% = $50,000 annual growth (annual income to the buyer at year 1 =$50,000)oInvestment return?o($50,000 + $50,000 + $2,000) / $100,000 x 100% = 102% total investment returno= 51% return per yearMODULE – 2Old vs New Properties (House and Land package)OLDNEWoOne-single contractoStamp duty on the wholeoOversea/foreign buyers CANNOTbuyo18 months buy the house then livein it. No need to pay rent buy payinterestoTwo separate contractsoStamp duty on land onlyoForeign buyers can buyo10% only before land regoo6 months land regoo12 months land regoOversea stamp duty – 4% (Oversea Charge) + 8% (Local)New House and Land packageo10% of land + 10% of house = 10% of total value on land registration,opay the full amount of landoConstruction startsoThe buyer pays 4-5 down payment on the construction5 Stages of ConstructionoLaying of concrete slab (base)oFramingoBrick-layingoInternal FinishoStamp duty - tax levied on property purchase
Example – new House and Land packageoInterest rate = 3.5%oRent = $650 per weekoLVR = 80%SOL.o$350,000 x 80% x 3.5% = $9,800 (Interest to pay on land for 12 months)oRent to live in a house for 18 months = $650 x 18 = $50,700oStamp duty saving = $350,000 x 4% = $14,000 (Local)oTotal cost = $9,800 + $50,700 + $14,000 = $60,500Example – Old HouseSOL.

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Term
One
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Mortgage loan

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