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Purchasing a new investment property procedure

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					                               LINK ACCOUNTING




                      PROPERTY
                     INVESTMENT
                        PLAN
                      CHECKLIST




Produced by: Link Accounting    Unit 16, 66 Bannister Rd Canning Vale WA 6155
                                             Ph: 9455 7022 Fax: 9455 7502
                                   LINK ACCOUNTING

                        Property Investment Plan (PIP)
Purpose

When purchasing a new investment property, you need to take extreme care before
entering into any arrangement and we strongly recommend you seek professional advice.

This checklist is made available to you to assist you in the process and help in gathering the
relevant information to allow for a thorough assessment of your potential acquisition.

We recommend, when purchasing an investment property, that you create a Property
Investment Plan (PIP) and utilize the following sequence to ensure the best possible overall
outcome.

      Research & Gain Knowledge of the following:
          o Tax Implications
          o Structures
          o Finance
          o Property
      Create a list of Goals & Objectives based on the knowledge you have acquired
      Purchase the property

Investors who do not follow the above sequence often find that they have to go back and
redo a specific area of the research step , which ends up costing them more time and money.

                                Research & Gain Knowledge




        Taxati on
       Implicati ons
                                                                                 Property

                                                                 Finance
                               Structures




                                            Goals & Objectives



Produced by: Link Accounting           Unit 16, 66 Bannister Rd Canning Vale WA 6155
                                                    Ph: 9455 7022 Fax: 9455 7502
                                 LINK ACCOUNTING



                        Investment Property Checklist

Research & Gain Knowledge

Tax Implications


   1. In whose name will the property be purchased in?
      ________________________________________________________________________
      ________________________________________________________________________


   2. If more than one person is purchasing the property will you be ‘joint tenants’ or
      ‘tenants in common’? If tenants in common what percentage is the property split?
      ________________________________________________________________________
      ________________________________________________________________________

   3. Have you considered having the property available for rent for at least a year
      before incurring expenses for repairs? As the purchase price reflects the
      condition of the property, any initial repairs are not deductible and are added
      to the cost base.                                                        Yes No

   4. Do you intend on getting a quantity surveyors report prepared?       Yes      No

   5. Do you require the contact details of Quantity Surveyors we          Yes      No
      recommend?

   6. Will the property be used as a rental property only or will you      Rental only
      be using it for personal use as well?                                Personal too

   7. Will you be renting the property to a family member or close friend at below
      market rent amounts?                                                   Yes No

   8. Will the property be negative, positive or neutrally geared?
      ________________________________________________________________________
      ________________________________________________________________________
      ________________________________________________________________________




Produced by: Link Accounting        Unit 16, 66 Bannister Rd Canning Vale WA 6155
                                                 Ph: 9455 7022 Fax: 9455 7502
                                  LINK ACCOUNTING



   9. Do you require Link Accounting to do an evaluation of how a              Yes   No
      property will effect your cashflow position?

   10. If yes above, what is the gross income of the owners of the property?

      $_______________ $_______________

   11. Would you like to do a PAYG Variation to enable you to get the tax benefits
       on a regular basis instead of having to wait till the end of the tax year?
                                                                                Yes No

   12. Have you kept the following paperwork to supply to your accountant?:
        Final settlement statement                                       Yes        No

       Offer and acceptance                                                   Yes   No

       Initial loan set up documentation                                      Yes   No

       Initial bank statements                                                Yes   No

       Real estate statements (monthly or annual)                             Yes   No

       Receipts for expenses – such as
                          a. Council rates                                     Yes   No
                          b. Water rates                                       Yes   No
                          c. Insurance                                         Yes   No
                          d. Land tax                                          Yes   No
                          e. Repairs and maintenance                           Yes   No


Structures

   13. Have you assessed the best structure to purchase the property in?       Yes   No

   14. What structure will you use?
       _________________________________________________________
       _________________________________________________________

   15. Do you need asset protection advice?                                    Yes   No

   16. Do you need to set up an investment trust?                              Yes   No


Produced by: Link Accounting        Unit 16, 66 Bannister Rd Canning Vale WA 6155
                                                 Ph: 9455 7022 Fax: 9455 7502
                                   LINK ACCOUNTING


Finance

   17. Will you need to obtain finance to purchase the property?             Yes      No

   18. Have you located a finance broker you are satisfied with?             Yes      No

   19. Contact details for finance broker
       _______________________________________________________________________
       _______________________________________________________________________
       _______________________________________________________________________

   20. Have you already arranged a pre approval?                             Yes      No

   21. What amount of the purchase price will be financed through a loan? How will the
       remainder be financed, if any?
       ________________________________________________________________________
       ________________________________________________________________________
       ________________________________________________________________________

   22. Who will you obtain finance through and what is the anticipated interest rate of the
       loan?
       ________________________________________________________________________
       ________________________________________________________________________
       ________________________________________________________________________

   23. Will the loan be set up as an interest only loan as apposed to having to make
       principal and interest repayments?                                     Yes No

   24. Is the interest on the loan calculated at a fixed or variable rate?   Fixed Variable

   25. Have you ensured that the loan for the investment property has been kept
       separate from any personal borrowings?                              Yes No

Property

   26. Have you researched the area you intend to buy a property in?         Yes      No

   27. Will you be using a buyer’s agent or property searcher to assist      Yes      No
       you to locate a property?

   28. Contact details of buyer’s agent or property searcher.
       _______________________________________________________________________
       _______________________________________________________________________
       _______________________________________________________________________
Produced by: Link Accounting          Unit 16, 66 Bannister Rd Canning Vale WA 6155
                                                   Ph: 9455 7022 Fax: 9455 7502
                                 LINK ACCOUNTING


   29. Are you looking at properties priced in the median price range?               Yes     No

   30. Do you intend to buy a newly built property or an older property with the     New Old
       view to renovate?

   31. Will the property be managed by a real estate agent or will you       Agent    Self
       manage it yourself?

   32. Contact details of real estate agent.
     ________________________________________________________________________
     ________________________________________________________________________
     ________________________________________________________________________

   33. Have you located a settlement agent that you feel comfortable using? Yes      No

   34. Contact details for settlement agent?
       ________________________________________________________________________
       ________________________________________________________________________
       ________________________________________________________________________

   35. Address of property when found
       ________________________________________________________________________
       ________________________________________________________________________
       ________________________________________________________________________

   36. Purchase price
       ________________________________________________________________________
       ________________________________________________________________________

   37. What is the amount of rent per week you anticipate you will get?
       ________________________________________________________________________
       ________________________________________________________________________

   38. When was the property built?
       ________________________________________________________________________
       ________________________________________________________________________

   39. What is your investment strategy (buy & hold, renovate & sell etc)?
       ________________________________________________________________________
       ________________________________________________________________________
       ________________________________________________________________________

   40. Are you looking for a high growth property or high return property   Growth    Return


Produced by: Link Accounting        Unit 16, 66 Bannister Rd Canning Vale WA 6155
                                                 Ph: 9455 7022 Fax: 9455 7502
                                LINK ACCOUNTING


      Goals & Objectives

      Tax Implications
      Eg. I will purchase a property that is positively geared to ensure I receive a
            frequent cashflow to supplement my income
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________

      Structures
      Eg. I will purchase the property in a trust structure to ensure correct
            distribution of profits and for added protection from litigation
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________

      Finance
      Eg. I will use the equity in my current home as a deposit to assist me to acquire
            the funding to purchase the property
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________

      Property
      Eg. I will purchase a unit within a 20km radius of the Perth CBD
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________
      ______________________________________________________________________




Produced by: Link Accounting       Unit 16, 66 Bannister Rd Canning Vale WA 6155
                                                Ph: 9455 7022 Fax: 9455 7502

				
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