6.47% Gross Yield Buy-Hold Potential Value Add
TOUGH MARKET but we never give up. Purchase #45 by Easy Buyer's Agent. Asking: $235,000, Purchase: $225,000. This is a 4-bedder sitting on a 700+sqm land and is already tenanted for $280 week returning 6.47% gross yield. Read on.
BRIEF:
Our client is a local investor who is intending to add more into his portfolio with buy-hold strategy.
PROPERTY STORY:
What a tough market we have especially in 2021 whereby it's almost 100% that you will have multi-offers on the table with people are paying way above the asking price. Finding investment properties have never been harder. Nonetheless, Easy Buyer's Agent did not give up, and we moved strategically to secure this amazing property for our client.
We have been eyeing this particular property for some time. It has been on the market that long due to the negative perception that the property might need a lot of work. There was reported termite activity and damage. Many owner occupiers (who are the majority of players at the moment) were turned off by the condition of the property. But not Easy Buyer's Agent.
When we viewed the property, equipped with experiences in renovation, straight away we knew that this was a bargain especially when considering the asking price and with tenant that was already in place paying $280/week. Even at asking price of $235,000, it already shows 6.2% gross yield. The condition of the property itself was actually still very good. It has ducted air-con, large bedrooms, shed and other qualities that we could easily add value to.
We negotiated - which has been a rare occurrence in this current climate - and got it for $225,000. This pushed up the gross yield to become 6.47%.
Suburb has shown 7.5% annual growth, vacancy rate 0.7% and with 3-bedders median price sitting at $250,000. We bought this 4-bedder for $225,000 and Domain already reported a $275,000 valuation. Our buyer can just hold to this for now for positive gearing, and can easily create even more equity in the future by sprucing it up.
We felt very satisfied with this purchase and we hope our client, too. It has indeed been a tough market for property buyers who are looking for value.
Thinking of buying property in WA? You know who to call. Tired of dealing with the stress of buying property in rising market? Handball it to us. Give us a call, consultation is free and let's just chat property.
Until the next purchase. Peace.
