3. Disclaimer
This presentation is not to be considered legal or financial
advice. The advice provided on this presentation is general
advice only. It has been prepared without taking into
account your objectives, financial situation or needs. Before
acting on this advice you should consider the
appropriateness of the advice, having regard to your own
objectives, financial situation and needs.
4. Investing In Melbourne Property
• Why Melbourne?
• About Melbourne
• Finance
• Tax
• Legal
• Visas
• Property Management
• The Purchase Process
5. Why Melbourne?
• World’s most livable city 2011,
2012, 2013, 2014*
• Healthcare
• Infrastructure
• Education
• Security
• Culture and Environment
• Sport
*The Economist Intelligence Unit (EIU) Global
Liveability Survey
6. About Melbourne
• Located in the state of Victoria
• Most densely populated state in
Australia
• Second largest city in Australia
(4.17 million people)
• Over 75% of the state live in
Melbourne city
• 66% of Melbourne is Australian-
born
7. About Melbourne
• Fastest growing area in Australia
• 10.5% population increase from
2012-2013
• Districts surrounding Melbourne’s
CBD grew by 15%
• Melbourne growing faster than
Sydney over the past decade
• Over 65,000 new permanent
residents to Victoria a year (2011-
2012)
8.
9.
10. Economy
• Victoria has the second largest
economy in Australia
• Accounts for 25% of the country’s
GDP
• Largest income sectors are finance,
insurance and property
• Largest single employer is
manufacturing
• Fastest growing sector is the
service industry
11. Education
• Melbourne University - oldest
university in Australia
• Monash University – largest
enrolment of nearly 56,000
students
• 30% of student population are
International students
• Over 200,000 international
students in Victoria
12. Historical
Performance
• Capital appreciation historical
average over past 10 years
• Apartments – 7% per year
• Houses – 8% per year
• Rental yield 4-5.6+% depending
on location and unit type
• Information openly available
from the REIV (Real Estate
Institute of Victoria)
13. Occupancy Rate
• Amount of homes that are
occupied
• Melbourne’s average over 96%
occupied
• Good rental market
• High number of owner occupied
• KL luxury condominiums have
occupancy rate of only 70% or
less
14. Regulation
• 10% down payment held in a trust
• By Australian regulation, this
money can’t be touched by the
developer
• Upon settlement, this 10% is
transferred to the bank with
interest gained*
• 70% of units must be sold before
developer’s bank loan kicks in
15. Financing
• Local loans allow maximum of 70%
financing
• Australian loans allow 80%
financing
• Australian banks can’t discriminate
on age
• Current interest rate is the lowest
for over 50 years
• Australian dollar weakened with
the Ringgit against the US Dollar
• Interest only loans for up to 15 years
16. Tax Benefits For
Foreigners
• Depreciation of fixtures and fittings
over 5 years, i.e. light fittings,
blinds, cupboards, etc.
• Claim property inspection as tax
deductibles (air ticket,
accommodation, food, transport
etc.)
• Borrowing expenses can be
claimed as a tax deductible
• Used to offset your rental income
• Accrue tax credits if you eventually
move to Australia
17. Stamp Duty
Savings
• State of Victoria has stamp duty
incentives for buying new
properties
• Encourage new developments in
the state
• Stamp duty is proportional to
construction completion
• Off-the-plan projects, stamp
duty is on land value only
18. Fees
• Body corporate
• Similar to management fee in
Malaysia
• Used to maintain the building or
area that you live in
• Paid by the home owner
• Council fees
• Fees to offset public services
• Waste collection and disposal
services for your neighborhood
• Maintain parks and gardens
• Roads and planning
19. Conveyancing
• Conveyancing is the process of
transferring ownership of a legal title of
land (property) from one person or
entity to another
• E.g. from developer to purchaser
• Conveyancers don’t necessarily have to
be lawyers but usually are
• Prepare, clarify and lodge legal
documents – e.g. contract of sale,
memorandum of transfer
• Research the property and its certificate
of title – check for easements, type of
title and any other information that
needs addressing
• Put the deposit money in a trust account
• Calculate the adjustment of rates and
taxes
• Settle the property – act on your behalf,
advise you when the property is settled,
contact your bank or financial institution
on when final payments are being made
• Represent your interest with a vendor or
their agent
20. Australian Visas
• You don’t need a visa to buy
Australian property
• FIRB application is required
• Buying one property does not
qualify you for a residency
• Buying multiple properties to
form a business may qualify for a
business visa
21. Australian Visas
• Foreigners must sell their property
back to a resident
• Choose locations where locals want
to stay
• Foreigners can only buy new
property, not sub sale
• Permeant residents qualify for first
home buyers grant
• Permanent residents can sell and
buy property to anyone
22. Property
Management
• Advertise your property for rent
• Show your unit to potential tenants
• Shortlist and filter tenants
• Inspect your unit for defects upon
receiving from the developer
• Collect rental
• Pay any fees from rental
• Organize for fixes on your unit
• Typically 7% of rental is charged as
their fees
23. Reserve Lot &
Booking Fee
Issuance of
Contract of Sale
Contract Signed 10% Deposit Paid
Exchange of
Contract of Sale
Pre-Settlement &
Inspection
Settlement
Keys Handed To
Client
Engage
Conveyancer
If Required
Apply FIRB If
Required
Apply For
Loan If
Required
The Purchase Process
24. Thank You
For more information on investing in Australian property,
please contact William Lee at:
William.lee@australproperty.com
+6 018 2388 972
