All Topics / Help Needed! / INVESTMENT PROPERTY WITH GOOD RETURN

Viewing 9 posts - 1 through 9 (of 9 total)
  • Profile photo of myabodemyabode
    Member
    @myabode
    Join Date: 2006
    Post Count: 10

    Hi Everyone,

    Happy new year to you all.
    I am an independent agent in Brisbane, Springfield lakes. I am currently looking for an investor to purchase a brand new two story property that i have found for my client who is willing to rent it direct for $410pw….

    The property details can be found on realestate.com.au
    Property No. 103714010

    To save you time the property is priced at $359K. But you will need to put in a couple of air cons as this is a requirement of the new tenant.

    Cheers

    And thank you

    Profile photo of propertypowerpropertypower
    Member
    @propertypower
    Join Date: 2006
    Post Count: 312

    Hi myabode,
    Just so that I understand this, is your client and the vendor one and the same party?
    If not, is your client looking at “rent to buy” option?
    Regards
    Sanjiv

    “There is no passion to be found playing small – in settling for a life that is less than the one you are capable of living.” – Nelson Mandela

    Profile photo of myabodemyabode
    Member
    @myabode
    Join Date: 2006
    Post Count: 10

    Hi sanjivgupta,
    Ttanks for the reply,

    The vendor and the client are not connected in anyway, The client is a private person who is wishing to run a small home based bisness from home,

    If you want to give me a call i can give you the full details.

    Ray 0407 006 068

    Ray

    Profile photo of dare_to_dreamdare_to_dream
    Member
    @dare_to_dream
    Join Date: 2006
    Post Count: 88

    Hi Ray,

    I thought you said a good return?? That rental return on this property is only 5.94% plus I would need to come up with 5% closing costs and it already needs work.

    Sorry, but it doesn’t sound all that great to me. I can get 6.25% interest for leaving my money in the bank at the moment with no hassle.

    Thanks anyway

    Profile photo of BarbaraBarbara
    Participant
    @barbara
    Join Date: 2003
    Post Count: 18

    Dare to Dream,

    Could you please show me how you came up with those figures.

    thanks[inlove]

    Profile photo of d_robb21d_robb21
    Member
    @d_robb21
    Join Date: 2006
    Post Count: 101

    dare_to_dream, a 6% yield is not a bad return, of course depending on where the property is, growth prospects. I assume that your calculations are not including growth prospects, tax breaks, etc, with that factored in, this property may pose a great opportunity to some investors.

    That being said, its not my cup of tea, but I know many investors in Melbourne who would be pleased to get 6% yields. Obviously not enough for you (or me), but I’m sure there will be investors out there to whom that appeals.

    Profile photo of d_robb21d_robb21
    Member
    @d_robb21
    Join Date: 2006
    Post Count: 101

    Barbara,
    Yield is essentially calculated by the following formula:

    ((Weekly rent * 52) / Purchase Price) * 100

    So for the above property

    ((410 *52) / 359,000)*100 = 5.9837 OR 5.94 rounded up.

    Cheers

    Dave.

    Profile photo of L.A AussieL.A Aussie
    Member
    @l.a-aussie
    Join Date: 2006
    Post Count: 1,488
    Originally posted by d_robb21:

    dare_to_dream, a 6% yield is not a bad return, of course depending on where the property is, growth prospects. I assume that your calculations are not including growth prospects, tax breaks, etc, with that factored in, this property may pose a great opportunity to some investors.

    That being said, its not my cup of tea, but I know many investors in Melbourne who would be pleased to get 6% yields. Obviously not enough for you (or me), but I’m sure there will be investors out there to whom that appeals.

    d_robb21,
    your post brings up an interesting observation; like you, to me a return of 6% (when the interest rates are over 7%) is no good, but to some it is. I guess the more experienced and knowledgeable you become, the more you can see a good deal or bad deal.
    I don’t subscribe to the view of a certain % return is good “considering the market”.
    A return is a return is a return, and the state of the market doesn’t factor into the equation in my book.
    If the current interest rate is x%, then to me, the return has to be at least 1% or more to be considered a decent return, notwithstanding any cap growth or tax breaks.
    That’s what I love about this forum – knowledgeable people sharing their experience and knowledge with the not so, and hopefully steering them away from bad deals towards good deals.

    Cheers,
    Marc.
    [email protected]

    “we get sent lemons; it’s up to us to make lemonade”

    Profile photo of myabodemyabode
    Member
    @myabode
    Join Date: 2006
    Post Count: 10

    Dare to DREAM

    I have a idea for you, How about you put all your money in tha bank at 7% return and lets c who has the most wealth in 5 years….

    Investing isnt all about immedate return!!!!

    Aver heard of capital growth!!!

Viewing 9 posts - 1 through 9 (of 9 total)

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