Buying real estate
- Foreign investors
Foreigners are prohibited from buying property in the secondary
market. They are however exempt from this restriction with regard
to commercial and industrial premises. They can only buy
properties off the plan or new, i.e.not stayed in or sold before.
Units in the construction phase are known as "off the plan" units.
- Procedure for buying off the plan or new units
An expression of interest (option) is paid to reserve a unit and a 5
day cooling period is required should the buyer change his mind.
If that happens the option money is returned to the purchaser and
the deal is cancelled.
If it is a matter of waiting for the bank's approval and it is granted
the S & P is signed and the contract goes unconditional, the
balance10% deposit, less the option is paid into an interest
accruing trust account in favour of the buyer.
Alternatively bonds specified by the vendor or a banker's
guarantee can take the place of the 10% deposit. The balance of
the payment is made upon settlement (TOP).
- Financing
The maximum finance that the bank will grant is 80%, documents
of employment and income is required for the processing of this
loan. If a 35% down payment is placed the banks will simply need
a statement of income by the purchaser, this is known as a low
document loan.
Tax planning
opportunities
Capital gains tax
Computation method:
- Pre 20 September
1985; no CGT - 18 Jan 1993 to 21 Sep.
1999; indexation method - Post 21 Sep 1999; after
12 months holding,
discount method
Tax planning
Stamp duty rates
(It varies among states
Insurance
Strategies
in Australia
model
- Wealth creation
through capital
appreciation
Balance portfolio
model
- Growth through
positive cash flow
and capital
appreciation.
Developing property
Introducing: The most informative, unbiased, easy to follow guide to
Buying A Home In Australia available anywhere on the Net today.
