How to Double Your Money Through Renovation

?? HOW TO DOUBLE YOUR MONEY THROUGH RENOVATION. Consider the following calculation:

NOTE: This is general information only and should not be taken as a financial advice.

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Purchase price: $150,000
5% purchase costs (stamp, etc): $7,500
10% deposit: $15,000
LMI: $7,500
90% borrowing: $135,000

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Interest rate: 4%
Holding cost up to 12 months: 4% * $135,000 = $5,400
Renovation cost: $30k

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Total invested money: $65,400
Total project: $200,400

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Sold price: $275,000
Selling agent fee: $10,000

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PROFIT: $275,000 – $10,000 – $200,400 = $64,600

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ROI of invested money: $64,600/$65,400 = 98.78% in up to 12 months.

Well, ok..it’s not 100% ROI (ie. double) your money but almost.

? This is of course assuming the selling price and the renovation cost is projected as above. There are so many renovation projects which costs just blow up; or you can’t sell it for the price you are projecting. In this instance, your profit diminishes.

Nonetheless, the potential of profiting through renovation is definitely there if you are up for it and you can find a profitable project. While targeting 100% ROI is in the optimistic side, and let’s say you halve the profit, that is still 50% ROI..which is WAY better than putting your money in the bank!

One of the properties we purchased last year for our clients was a renovation project bought at $415k, which, it was sold few months ago for $670k.

Another one was a $530k property which on the same street, there were properties sold for as high as $985k.

Another one was a $372,500 which, similar renovated properties in the area have sold for $500k.

? If you’re keen on profitable renovation projects, do speak to us, we can assist you with identifying and purchasing it.