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Old 20.06.2019, 09:56
RTN RTN is offline
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Re: Holiday Apartment Purchase

Just for information, I ran through an cost exercise for a client recently so I thought I would share it. The idea being to buy a 2Br apartment and renovate it and sell in 18 to 24 Mths whilst making a profit after all costs without renting it out. As with any investment exercise past performance can give you an idea for potential outcomes but nothing is guaranteed. The "profit" comes more from tax savings than selling the property at a price higher than actual costs, this (tax saving) of course is individually variable depending on income and tax rate of residence.

Residence Meilen, Salary 250K

Apartment in Flims purchase 500k aimed selling price 700k.
Costs
200k Deposit (40% of purchase price for holiday homes)
Interest @ 1% of 300k for 2 years 6k
Neben cost for 2 years 11k
Renovation 150k
Capital gains tax 6% up 100k 6k
Capital gains tax 11% above 100k 11k
Agent fee to sell 3% (or sell it yourself) 15k
Total Cost 199k

Tax saving.
250k Salary 46.6k year
100k Salary (deducting renovation cost) 6.4k year
175k Salary (deducting renovation cost over two years) 22.6k year

So in this summary, you could have a holiday apartment and be 20k a year in front! But not a lot of people have access to 350k and a salary of 250k with very few tax deductibles but if you do I could assist you, pm me.
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