Article supplied by Ryan Crawford of Crawford Realty
- Buying house & land packages to achieve instant equity
House and land packages offer a number of distinct advantages when compared to buying an established as they tend to be competitively priced and offer a lower cost entry into the property market. In addition to this entry advantage, investors can avoid paying stamp duty in certain states. This can be a saving of thousands of dollars when compared with the potential stamp duty payable when buying an established home.
The greatest opportunity for the astute investor is the ability to lock in construction and land prices by using a fixed price contract and potentially end up with a property worth significantly more than what it was originally purchased for. In rising markets it is not unusual to see properties settling with instant equity, which the investor can borrow against to assist in future purchases.
- Renovations to boost rent & equity
Astute property investors can add substantial capital value to older style properties in mining towns, especially if homes in the area are undervalued, run down or rented below the market, by adding low cost cosmetic renovations.
Cosmetic renovations can quickly boost rental returns and therefore the underlying value of a home, particularly in mining regions where the value is proportionate to the rental values. A quick coat of paint, new carpets and kitchen upgrade can mean a substantial jump in rent and equity in your investment.
A good tip is to start with a smaller more affordable property such as an older type apartment that requires just simple improvements.
- Subdividing larger blocks or adding a granny flat
There are countless examples of astute property investors who have purchased homes on larger lots, sub-divided them in duplex lots and then built another home or granny flat at the rear and achieved impressive profits. Some of these investors have sold off one part of the property or decided to retain both properties because of the additional rental returns they deliver. Before undertaking this strategy a good tip is to check with the local council to determine if the target lot has current or future subdivision potential.
- Leasing on short term or fully serviced basis
The workforce in mining towns tends to be migratory due to the advent of fly in fly out operations. Properties in most demand by these workers are homes that are fully serviced and also offer flexibility in terms of the length of lease.
Investors can take advantage of generous tax depreciation benefits associated with leasing their homes fully furnished and equipped. In addition, leasing the property on short term basis means that they can increase their rents quickly in a pressure cooker rental market.
Property investors who can provide this type of accommodation service in mining towns can generate substantially more rental income compared to leasing their property unfurnished on a long term lease.
You can find more tips as well as true life stories about successful investors by visiting the website of Crawford Property Group – the positively geared property specialists at: www.crawfordpropertygroup.com.au
The above information is supplied by Crawford Realty.
Disclaimer: while due care is taken, the viewpoints expressed by sponsors
do not necessarily reflect the opinions of Your Investment Property.
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