Triple Your Money Through Cheap Property Purchase Strategy

?? I often hear #property buyers are more keen on buying mid-up properties thinking that these properties have better capital growth. The cheap properties, the ones that that might have higher yields are often underestimated. “Capital growth will always eclipse cashflow” they say.

Well, I’m not knocking anyone. However, when it comes to property investing, money can be made anywhere. Regardless of which property you buy: expensive vs cheap, A-Grade suburbs vs B-Grade suburbs, etc. When you buy right and apply the right strategy, you will multiply your money.

In this opportunity I’m going to show you how you can triple your money through buying cheap properties.

NOTE: This is general guidance only and not taking into consideration taxation and your personal financial situation. This calculation assumes no rent increase nor cost increase. This is not a financial advice, please speak to your professionals in this regard.

NOTE 2: Numbers will vary depending on purchase price, interest rate, rental income, etc.

* The rental income and purchase cost below are using an actual property purchase we did for one of our clients. Click here to see the property.

Purchase price: $170,000
10% deposit: $17,000
90% borrowing: $153,000
5% purchase costs and stamp duty: $8,500

MONEY INVESTED: $25,500

To triple your money, your money needs to grow from $25,500 to become $76,500 which is a $51,000 growth.

Annual interest rate @ 4%: $6,120
Water + council: $3,000
Insurances: $1,000
Maintenance: $500

ANNUAL COST: $10,620

Weekly rent: $280
Annual rent: $14,560
Vacancy rate: 3%

ANNUAL PROFIT: $3,515.92

Let’s take 10-year timespan. From rent alone you would be earning $39,400 minus 3% vacancy rate: $38,252.

Your original money $25,500 has now become $63,752.

All you need to see is for the property to grow up in value by $12,748 to make a total of $76,500 and you would have tripled your money….OR you could have waited a bit longer and the rent alone would have tripled your money.

I’m sure it is not too difficult for a property to go up by $12,748 in value over 10 years.

Let’s say in 15 years time you triple your money ie. 300% return. It means, every year your investment returns 20%…hey, this figures is very familiar because the Oracle of Omaha ie. Warren Buffet’s Berkshire Hathaway has reported around 17.1% returns.

Do this 10 more times with similarly purchase properties….BOOM.

The capital requirement is very small, and yet, the return of a positive gearing property can be substantial long term.

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