Depreciation tax deduction opportunity for investors as The Block Sky High reality television series turns serious
It was during the 1850s Victorian gold rush that a tent city known as Canvas Town was established in what's now known as South Melbourne.
The area was home to tens of thousands of migrants, particularly from Ireland and China, who having disembarked were soon off to seek their fortunes in the central Victoria goldfields.
Some 160 years on, it's property speculators who are homing in on the five South Melbourne luxury apartments from the hit Channel 9 reality television show The Block Sky High 2013.
"They are an underlying investor’s goldmine," according to BMT Tax Depreciation boss Bradley Beer.
"The units will obtain maximum depreciation potential within the first 5 years of ownership," he said.
BMT has identified significant deductions available to property investors bidding at the July 27 auctions where prices are tipped to be $1.2 million plus.
All listing agents are likely to be using the BMT reports in their pitch to convince investors to be among the buyers.
The depreciation reports have been prepared by BMT Tax Depreciation Quantity Surveyors, which have inspected the former motel premises – now renovated – and estimated what a buyer could claim in deductions in his or her tax returns.
The tax depreciation schedule for apartment 301/142 Park Sreet - Bec and George's apartment listed through Gerald Betts at RT Edgar - advises purchasers could claim over $38,000 in deductions during the first full year leading to a cumulative total of $165,000 in the first five years of ownership.
But research shows that 80% of property investors fail to take full advantage of property depreciation, Beer says.
“They are missing out on thousands of dollars in their pockets,” he says, as the Australian Taxation Office allows property owners to claim depreciation over items that wear out as a tax deduction.
Depreciation can only be obtained by property owners who obtain income from their property.
The BMT report has been based on very preliminary documentation, and the figures provided serve as a guide only.
The Block's Bec and George have listed their three-bedroom South Melbourne apartment through an agent who is well versed in reality TV listings.
RT Edgar agent Gerald Betts oversaw the listing of the 407 Dorcas Street terrace in South Melbourne (pictured below) that was the final offering to hit the market from the 2012 season of The Block. It was the offering of Dan and Dani and sold for $1,440,000.
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This time around, he is marketing Bec and George's apartment on the premise that its charms will outlast its Block fame.
"The profile of The Block is prominent, but temporary. The appeal of this exceptional apartment is permanent," the marketing says.
The Park Street apartment (pictured below) features Spotted Gum tectonic flooring and a large living area with a surround sound cinema entertainment system.
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The kitchen has stone surfaces, a large island bench, European appliances, walk-in pantry and bar with beer and wine fridges.
The four Dorcas Street, South Melbourne terrraces from the hit Channel 9 reality television show The Block 2012 had BMT tax depreciation schedule advising investor purchasers they could claim over $30,000 in deductions during the first full year leading to a cumulative total of $140,000 in the first five years of ownership.
