Costs upfront for new IP purchase ?

[richard56]

Hi
Just trying to get a ballpark idea of my upfront cost of buying my first IP..


Conveyancing...$1000
Insurance.....$1000
Portion of rates...$1000

How do those numbers look and what else should I budget for.

3 Bedroom House in Papakura...around the $350,000 mark

Richard

[Ivan McIntosh]

You should budget an extra $500 for the conveyancing costs. $1.1k fee plus GST and disbursements like govt registration charges will push the overall bill to $1,500.

Rates apportionment could actually reduce your purchase price if they haven't paid the last installment....you won't know till you see the settlement statement. Ok, it's more likely that they will have paid and you'll be reimbursing them a month or so....so $150 if we assume a $1750 yearly rates bill.

Insurance looks about right.

[richard56]

Hi
Updated numbers


Conveyancing...$1500
Insurance.....$1000
Portion of rates...$150

How do those numbers look and what else should I budget for.

3 Bedroom House in Papakura...around the $350,000 mark

Anything else I should budget on?

I am planning to have a little slush fund that covers at least 2 months rent ...in case of the worst.

But for now it is costs I am going to need to cover when purchasing and say the first month of ownership.


Richard

[JABlog]

You should try and buy a brand new 4 bdr for $400K , much better returns

[richard56]

You should try and buy a brand new 4 bdr for $400K , much better returns

Interesting...What sort of rental difference between a reasonable well maintained older property and a brand new one for the same price?
Richard

[Wiz]

The extra room will bring you considerably more margin. In Chch, it's between 50 to 100/wk more. i.e. 2 bed goes for 275/wk, on the same street a 3 bed will push 350 and a 4 bed a smidge over 400. Otherwise, look at a 3 bed with the opportunity to 'create' an extra room. A really top way of maximising return.