All Topics / Help Needed! / Bought a house for $22,000 in NSW

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  • Profile photo of EngeloRumoraEngeloRumora
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    @engelorumora
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    Hi guys,

    Just thought I would write a post on a interesting purchase I have recently made. Its a 3 bed house in Coonamble. I submitted an offer of $20,000 for the property, I was more mucking around than thinking I could actually buy it at that price. After a bit of negotiating I managed to seal the deal for $22,000. I checked some comparables currently on the market for sale and there are a few properties under contract around the $80,000 range. Most of them are in average condition. I also did an RP Data CMA on the property and it came up between $90,000 – $110,000. I wanted to see in what condition the property was so I set out on a 8 hour drive to have a look and found out that it is actually a 4 bedder. Buy 3 get 1 free hahaha. Its a Nathan Birch special as its in pretty bad condition and needs renovating but offers great equity and yield. Reno will take 2 weeks to complete and cost no more than $15,000. Not much availabe for rent in the area and few local agents indicated that should get between $160 – $200 per week rent. After all expenses the net yield is around 16%.

    Regards,
    Engelo

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    Profile photo of BMWBMW
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    Well done Engelo. I have family in Coonamble, and just driving around recently I have noticed a lot more properties for sale.  Could have something to do with a new agent in town but I have also heard of one particular investor struggling to find tenants and also buyers.  But at $22K sounds like you found a good deal.

    Profile photo of EngeloRumoraEngeloRumora
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    Hi BMW,

    Thanks for your reply, I spoke to a few agents, locals in the area and just got of the phone to council. Rentals are in high demand and there is a lot of people looking at the moment so yeah thats what I was told.

    Regards,
    Engelo

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    Profile photo of TaylorChangTaylorChang
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    Hi Engelo,

    Sound like a fantastic deal.

    Looking forward to catch up with you

    Taylor Chang

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    Profile photo of EngeloRumoraEngeloRumora
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    Hi Taylor,

    Thanks, would be good to catch up soon.

    Engelo

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    Profile photo of Jamie MooreJamie Moore
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    Nice work Engelo – that's a sweet deal. I'm sure Nathan is very proud :)

    Cheers

    Jamie

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    Profile photo of kong71286kong71286
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    Very impressive

    If you don't me asking…

    How did you go about with your research to find such a gem?

    Profile photo of EngeloRumoraEngeloRumora
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    Jamie M wrote:
    Nice work Engelo – that's a sweet deal. I'm sure Nathan is very proud :)

    Cheers

    Jamie

    You know Nathan, He loves these deals haha He just finished one in Griffith. Looks great.

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    Profile photo of lamp1111lamp1111
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    Sorry, I'm just curious, still very new to the property market, I'm just suprised that there are still properties for less than xxxk, especially in Sydnye, have I mis-read this post?

    Profile photo of PaulliePaullie
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    whats wrong with it.

    Profile photo of JpcashflowJpcashflow
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    Profile photo of EngeloRumoraEngeloRumora
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    There are no rentals available. Thats the word from the locals. Lots of stock on the market but I dont plan on selling. If I did could prob walk it out the door to an investor for $60,000 and still make a buck.

    Engelo

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    Profile photo of EngeloRumoraEngeloRumora
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    Paullie wrote:
    whats wrong with it.

    Needs reno

    EngeloRumora | Ohio Cashflow
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    Profile photo of JpcashflowJpcashflow
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    Hi,Mate not trying to put your deal down hope it all works well.

    But how can an agent give you a rental figure if there is nothing up for rent?????
    and why are more people looking to sell then rent?
    or even hold properties

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    Profile photo of VictoriaCVictoriaC
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    Hi Engelo,
     Congrats on your purchase. Let us know how you go once the reno is finished – really interested to see how long it takes you to rent out and for how much.
    Victoria :-)

    Profile photo of EngeloRumoraEngeloRumora
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    Jpcashflow wrote:
    Hi,Mate not trying to put your deal down hope it all works well.

    But how can an agent give you a rental figure if there is nothing up for rent?????
    and why are more people looking to sell then rent?
    or even hold properties

    nah mate not at all,

    Wouldnt they base on what else is currently renting? I know what some other properties are renting for in the area as I have seen them.

    I dont rely on agents rental figures as they will always say what you want to hear. There are 4 properties in the $70,000 – $80,000 range that are under contract and quite a few people have indicated in town that there is a high demand for rentals. This property once renovated would fit in that category. The more expensive stuff isnt selling. I know there is a lot of investors buying in Coonamble for the yield. Worst case scenario I will rent it for $100pw which will give me a 9% net return or walk it out the door for $50,000 and still make money. I would be happy to buy another at the same price but they are hard to find and they sell for $50,000+ even in towns with a population of 5 hahahahaha

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    Profile photo of EngeloRumoraEngeloRumora
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    VictoriaC wrote:
    Hi Engelo,
     Congrats on your purchase. Let us know how you go once the reno is finished – really interested to see how long it takes you to rent out and for how much.
    Victoria :-)

    Thanks,

    No worries, will do.

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    Profile photo of mattstamattsta
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    That's quite amazing mate. A great bargain! and inspirational too

    Profile photo of EngeloRumoraEngeloRumora
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    mattsta wrote:
    That's quite amazing mate. A great bargain! and inspirational too

    Thanks mate,

    Cheap entry not much risk

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    Profile photo of Chris89Chris89
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    Hi Engelo10, other than the very low purchase price, what are the positives?

    14% population decline in the area
    higher than normal amounts of properties for sale
    granted 0.2% vacancy rate, but that is because there was one property for rent, 2 rental vacancies brings the vacancy rate to 1%
    And the only rental property up for rent has been on the market for a long time (1000 views)

    sorry to put a downer on this, but what are the positives you have found with the town that I have missed? Other than the price. Will be interesting to see ow u go renting it :-)

    Chris

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