The Costs of Becoming A Property Investor
The Costs of Becoming A Property Investor
Hey there! At JKL Real Estate, we understand that jumping into property investment is a big step, full of exciting possibilities and, yes, a few unexpected expenses. To help you navigate this journey smoothly, we’ve put together a guide on the various costs you might encounter. Let’s dive in!
Upfront and Ongoing Fees
Starting with the purchase price is just the beginning. Your mortgage will come with more than just principal and interest payments. Here are some additional costs to consider:
- Establishment, Legal, and Application Costs
- Bank Valuation Fees
- Monthly or Annual Fees
- Lender’s Mortgage Insurance (LMI): Required if your deposit is less than 20%.
Important: Always read the fine print as there may be other fees hidden in your mortgage agreement.
Purchase Costs
When purchasing a property, you’ll encounter several additional costs, including:
- Stamp Duty: This varies from state to state.
- Building and Pest Inspections
- Solicitor or Conveyancer Fees
- Legal Transfer of Ownership
- Registration Fees
- Title Searches
Insurance
Protecting your investment is crucial. Here are two key types of insurance you’ll need:
- Building Insurance: Covers your property against theft, fire, storms, and other risks.
- Landlord Insurance: Protects you if tenants default on rent or damage your property.
Other Costs to Consider
Beyond the initial purchase and insurance, there are ongoing expenses to keep in mind:
- Repairs and Maintenance: Plumbers, electricians, and handymen costs.
- Renovation Costs
- Pest Control
- Connecting Utilities and Services
- Finding New Tenants: Advertising and marketing costs.
- Land Tax
- Accountant’s Fees
- Legal Fees
- Strata and Body Corporate Fees
- Damages from Problem Tenants
Council Rates
Don’t forget to factor in council and water rates. These are essential costs that impact your overall returns.
Property Management Fees
A good property manager is worth the investment. They handle:
- Determining Rental Value
- Marketing and Tenant Viewings
- Tenant Background Checks and Screening
- Regular Inspections and Reports
- Organizing Repairs and Maintenance
- Handling Complaints and Issues
- Dealing with Legal Issues Like Evictions
Welcome to the JKL Family
At JKL Real Estate, we’re here to help you feel at home in the world of real estate. Whether you're buying your first home or refinancing, our family-oriented approach ensures you have the support and expertise you need. Welcome to the JKL family, where your home buying journey is our top priority.
Experience the JKL Real Estate Difference. Welcome Home.