Thanks mate! We bought in NSW to diversify our portfolio, utilise the land tax threshold in NSW and go for a cashflow play in a large regional location The new laws in QLD will up our land tax by a few thousand dollars per year
All the best with your new purchase Luke! And thanks for sharing your experience. I’m just wondering whether you bought the unit block under your personal names or different structure?
Congratulation, you've made it to the most expensive state in Australia. Question: How many percent is the rental yield? How is this a good investment if we thinking about the holding cost like strata (which keep going up every year)? The capital gain has to be more than the summary of the holding cost, in the future, right? I really want to learn. Also buying from auction, what if the bank valuation is below the winning bidding price? What will happen if the cash not enough?
Thanks! Lots to unpack here. Lots of the questions around the numbers will be revealed in a video over the next few weeks. Some quick info: Gross rental yield is over 5%. There is not strata on the property as we own the entire block. If the valuation didn't stack up with the bank, we would be required to provide more cash. If you weren't able to find finance you'd lose your $140,000 deposit. Very rare for valuation not to come in on purchase price unless you significantly overpay. There were 3 bidders on this property at 1.35m. So no real concerns on the bank valuation
@@lukewiles1 5% gross rental yield is a not very good return and you will be competing with lots of very good quality homes and units which are currently available in Coffs Harbour for rental at very reasonable prices compared with the major cities . Besides the rental return , you should be looking at the long term capital gain on the block , maybe the block could be strata titled and sold off on an individual basis , it will be interesting to see your feedback about your purchase in 1 years time and if you think you made the right decision or if you invested elsewhere you would have done better in the short term . In 2018 , if I went shopping in Tasmania in places like Devonport or Burnie , I could have bought about 7 units or houses for around $1.4 million and today those properties have sky rocketed and would be returning around $130,000 yearly in rent , which is about double the return you are receiving from your investment property so hopefully in 4 years time you can get a 10% return yearly on your investment .
Thanks for sharing your experience 😊 I'm a subscriber from the UK and I'd like to know if the land that the house and apartments are on are leased or freehold? Not sure what you'd call it over there but basically do you own the land or you have to pay a service charge?
We call it freehold house and land here in Australia. So we own the land and buildings on the title. You do have to pay Local Council Rates and Land Tax (State Government) though. Hope that clears it up!
The problem with Coffs Harbour is that it is a long way away from any capital city and for investment properties often the best place for investment properties is being close to the CBD of a capital city . Getting to Coffs Harbour quickly if something needs quick attention can take a lot of travel time . The quality of the tenants is also important when renting out investment properties because mishaps can happen to an investment property if you get the wrong tenants or the tenants don't have secure incomes . In a place like Coffs Harbour getting the ideal tenant maybe harder because the people people with good incomes are often home buyers and not home renters but in the big major capital cities because home prices are so high , people with very good incomes and who make very good tenants are often still renting instead of buying because the home prices are too high .
Appreciate your points here. I disagree (as we made a purchase in Coffs). Coffs is a major regional location with circa 100,000 people. I dont think it needs to be within daily commute distance to a major city (e.g. like Port Macquire) This place is tenanted with long term tenants so no concerns about competition with other stock as we are happy with the location of this property. This will give it an edge of new builds out of town. Only time will tell if this is a good investment but we're very happy with the buy
Hi Luke I am lucky to have a block of 5 units with a seperate larger rear unit. Other than using a real estate agent. How do you value them, is their a system calculation available.
Hi Anne. You can pay for a valuation if you want a 3rd party market appraisal or talk to local sales agent's. Otherwise you need to look at capitalisation rates (like commercial property) or comparable market analysis. You could look at the value at each of the units based on comparable unit sales to help determine a current value (if they were strata titled)
