Hi Guys & Gals
I was looking for some cheap cashflow property’s and found a few in rural towns about 400km from melbourne CBD.I saw some property’s for around 65-70k renting around 140-150 a week this will be my first invest property so just want to know what you guys think?
Pros i can see if
Great cash flow.
Cheap to get in to only need 14k for deposit instead of 60k for around where i live which will take me forever to save.Cons i guess would be higher vacancy
And less growth
If i wanted to sell will take longer
Maybe hard to get finance.What are your thoughts guys and gals?
It depends on your goals and when you want to achieve them? I’ve invested heavily in regionals for cash flow but the foundations of my portfolio was capital growth. You need both cash flow and capital growth to keep growing your portfolio but focusing on capital growth definitely helps for quicker transactions. If you are considering regionals the things to look for is
-more than one industry in the town
-houses or Units that you can do cosmetic touch ups on. It’ll lower chances of vacancies, boost rental return, quality of tenant as well as provide some sweat equity
-Infrastructure(is the town going to be expanding any time soon)
-Talk to people in the town(property managers are more honest than sales agent as they will have to deal with a grumpy landlord)
Hope this helps!-
This reply was modified 7 years, 7 months ago by
Tony Fleming.
Tony Fleming | Triumphant Property Group
http://www.triumphantpropertygroup.com.au
Email MeNSW Buyer's Agent specialising in Western Sydney-Blue Mountains-Orange-Albury
Thanks Tony!
My goal is to replace my annual income through positive cashflow property’s as fast as i can great tips much appreciated!
Hi Mikey,
Such things certainly can work – go here for a quick look at one who did this just a few years ago. Some of the pictures can give “an idea” of just what Darryl did, but further down, there is a link to allow you to buy a back-copy of the Investing Magazine so you can read it all up.Enjoy !!
Benny
Thanks Benny killing it with the information!
Thats the kind of stratergy i am looking into.
Also i see alot of rural property’s need renovation which can be a good thing to buy a problem and sell the soultion is it worth renovating property’s around 60-70k?is it worth renovating property’s around 60-70k?
Not enough info to answer it straight up, except to say that others have done it, but surely it would depend on each individual case. As always, don’t over-capitalise – and, in some country towns, that might not be too hard to do.
But yeah – buy the problem, and sell the solution. Darryl seemed to do that pretty well, and you saw his Buy prices, and then his Reno’ed Values afterward !!!
Benny
Completely agree with Benny. I would just add that buying properties for so cheap would usually mean that the end profit (after reno) would probably not be too high, in dollar amount.
That said, starting small could be perfect, then gradually building up to more expensive properties (the amount of effort is about the same for 60k property and 600k but the profit amount in the latter should be much bigger). We also started at the cheapest properties we found but today we don’t bother with such properties due to the above.
Hope this helps? 😊
Cheers,
EthanEthan Timor | Aligned Finance Pty Ltd
http://www.alignedfinance.com.au/
Email Me | Phone MeActive Investor & Broker; Based in Northern NSW, servicing Australia wide; Author of '34 Proven Ways to Maximise Your Borrowing Power' (download free from our website)
Thanks Ethan!
Yes that’s what i thought i was thinking of starting out with them because i don’t have much capital and also they have good cash flow returns to help build up more savings to invest in better more expensive property deals. So should i just rent them out as is for the property’s under 60-70k? because what i was thinking the materials/labor to renovate the property might cost to much compared to the value of the property.
Thanks :D
Thanks Ethan!
Yes that’s what i thought i was thinking of starting out with them because i don’t have much capital and also they have good cash flow returns to help build up more savings to invest in better more expensive property deals. So should i just rent them out as is for the property’s under 60-70k? because what i was thinking the materials/labor to renovate the property might cost to much compared to the value of the property.
Thanks :DCheers, mate. Always happy to help 😊
Really can’t comment about the specifics of your deal. If after research you come to the conclusion that the best way forward (for you!) is to buy and rent, that’s great. If you will find that doing a cosmetic reno (to increase rent but mainly to refinance and get most/all/more than your deposit back), well that may be even better if you ask me 😉
As Benny said, it’s case to case basis.
Wishing you a lot of success and buckets of fun,
EthanEthan Timor | Aligned Finance Pty Ltd
http://www.alignedfinance.com.au/
Email Me | Phone MeActive Investor & Broker; Based in Northern NSW, servicing Australia wide; Author of '34 Proven Ways to Maximise Your Borrowing Power' (download free from our website)
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This reply was modified 7 years, 7 months ago by
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