Hi Guys!
I have been researching property WA wide for a couple of months now… and as to date have not come across any positively geared ones! I am starting to feel like I missed the boat by about 2-3years or so!!! I have read 0-130 and it all is perfectly clear – but the right property just seems to be ‘eluding’ me!! I have searched both Perth city regions and all have come back negative at abou 4-5% ROI and just arent worth the look in.
Can anyone give me some advice as to where I should look or you can be plain out blunt and tell me which suburb you feel would be good. I have researched Kalgoorlie property and other mining towns as they seem to have the closest to being positive cashflow about – I am not too concerned with CG I am definately going for cashflow positive.. Any help would be seriously appreciated..
Thanks from someone who is starting to get disillusioned……Ranae[blink]
Why aren’t you concerned with capital growth??? You won’t get very far without it!
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Are you looking to simply buy a property that is producing cashflow?
You will not be alone in being unable to find a cashflow property for sale.
The reason for this is because it simply is not that simple. Nobody would sell a cash producing property, and if one ever came onto the market, I would think the vendor’s agent would have stitched up the sale with a purchaser well before any advertising would have been thought of! So unless you have a well established network, you may not see these properties.
So where do you find these cashflow properties?
More often than not cashflow properties are MADE, not bought.
It can be as simple as small changes to a property you might purchase, that increase the value of the property, which in turn may entitle you to an increase in rent, as well as an increase in capital value which in turn (depending on your strategy) can allow you to access more equity to invest again.
I understand your frustration, but stick with it!
Learn, Love, Strive. Make a difference!
Hi Ranae,
Just be careful that in your pursuit of a cashflow positive property you don’t end up buying somewhere near the ‘blackstump’
There are a whole range of factors, beyond the cashflow position, that need to equally considered when choosing your property.
Derek
[email protected]
0409 882 958
Property investment advice and researched property in quality locations available.Ranae,
I agree with Terry – you should be concerned about capital growth – IMO it’s where the big bikkies are.
Keep searching for CF+ stuff in WA. There is oodles of it about – just don’t tell those chaps over in the East.
Saw one the other day with a State Govt tenant – still for sale I believe – on a secure 6 year lease. Was CF+ by about $ 80K per year – if you borrowed 100% of the purchase price plus all stamp duty and closing costs.
Chin up – keep looking !!!
Cheers,
Dazzling
“No point having a cake if you can’t eat it.”
Hi there,
I just sold a regional property in WA which was positively geared. I got cold feet when the mining company did not proceed with expected plans, as the area would not achieve future CG.Also, Dazzling its not the bikies you need to watch out for?? You probably have a higher risk of bikies renting one of your industrial ware houses. Some do have good businesses????LOL
Unfortunately I cant actually say what you need to watch out for – not on this forum.
Back to the issue, you could look at Karratha, though costly.
Northam has experienced CG, however not sure whether you can still obtain positive.
Good Luck, M
And in case the link doesn’t work:
$188,000
MANDURAH
Located in fast growing community of Waroona is this great investment. Currently tenanted as commercial laundry depot @ appox: $1800.00 per month. Leased until 2006, with 5 year option over 400sqm of floor space.This place is a commercial laundry that is very positive cashflow. 11 second rule:
$415 / week = $207,500 price for 10% return. Since the price is < that = most likely cashflow positive.The draw backs I see: commercial property generally needs 60%LVR or lower and from the photo’s it looks a little old so may need some maintenance soon. Lease will expire next year so be prepared for it not to be renewed.
Good points: cashflow positive for sure. Waroona is set to burst at the seems in the coming couple of years. Alcoa is investing very heavily in that area and there is a great demand for commercial space.My father-in-law has presold his 5 unit development there and pre-leased his yet to be developed residential / commercial land there also (I missed buying the block next to his by a matter of days for only $42,000 [glum2])
Though in general WA around Perth is all about CG. One of my places has jumped up in value by nearly $150k in the past 2 years (doubled in price) in Mandurah but the rent is still way down because the house is crap but the land is huge and everyone wants to subdivide it (me included)[biggrin]
Hi Surrey, your property in Mandurah that can be sub-divided sounds very good. Where’s the location?
I am sure you are aware that Mandurah has been one of the best performing areas over recent years and still going ahead.
Unfortunately building in Perth market at present is not too crash hot – with labour shortages – building can take up to 18 months. Building costs going through the roof (increase of 1% per month).
I dont believe the timing is right, you may consider waiting until costs are reasonable before you consider developing.
Good luck, M
Marisa,
I meant bikkies – as in biscuits…lotsa mullah – not the motorcycle chaps.
Funny anyhow.
Cheers,
Dazzling
“No point having a cake if you can’t eat it.”
Hi All
Regarding this Waroona property
Located in fast growing community of Waroona is this great investment. Currently tenanted as commercial laundry depot @ appox: $1800.00 per month. Leased until 2006, with 5 year option over 400sqm of floor space.This place is a commercial laundry that is very positive cashflow. 11 second rule:
$415 / week = $207,500 price for 10% return. Since the price is < that = most likely cashflow positive.The draw backs I see: commercial property generally needs 60%LVR or lower and from the photo’s it looks a little old so may need some maintenance soon. Lease will expire next year so be prepared for it not to be renewed.
Good points: cashflow positive for sure. Waroona is set to burst at the seems in the coming couple of years. Alcoa is investing very heavily in that area and there is a great demand for commercial space.We had a look at this place about 8 months ago. Yes the numbers sounded good but the linen company wasn’t going to renew the lease. To say it is a bit old is an understatement.
It was hard to envisage finding another tenant in a hurry either as the street where it is located is quite “dead” and is on the opposite side of the highway to where most residential development is. In fact it is down the road from the pub which also looked a shadow of it’s former self. It used to be mandatory to stop there on the way home after Footy or Cricket.
Anyway it wasn’t for us.Regards
CliveMarisa,
ah yes Northam……….purchased a property 18 months ago there and have already seen substantial growth[thumbsupanim]. Great little spot and I think you’ll still find the odd cash flow property there too!
SQ
suzieq, congratulations on your Northam property. Great stuff.
I am actually building in the south west, Dalyellup Beach Estate(Bunbury).
Rental returns are brilliant compared to Perth market and with depreciation it is costing very little to keep. We were fortunate enough to buy a block with title – as someone’s finance fell over.
I believe still plenty of growth in this area. Also there is huge rental demand.
Cheers, M[biggrin]
Hi,
Regarding the laundry link I posted: That was just the result of a five minute search on realestate.com.au for the purpose of an example rather than a recommendation. If I was looking for only 5 minutes and found this then after 5 months I imagine there must be opportunities to be had.
As Buzwells said, I think networking leads to the best opportunities.
You have to work to get cashflow positive. No such thing as money for nothing, if that was the case we’d all be millionaires.Personally I’m not that crash hot on cashflow positive property. I look for it and try to get it, but ultimately I see more long term wealth in CG trading in to make more CG. At the end of the haul trade in enough big growth properties to pay for the rest and then you have passive income to live on. Well, it’s a theory at least. [biggrin]
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