Positive Cashflow Investing in Sydney

Last year at least 2 of our clients had found postive geared properties in Sydney. You just have to look for something with a twist.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

Firstly I suggest you to read the second book of Phil. You will discover than the goal is not to find a positive cashflow property (which is really hard in this moment everywhere in Australia) but find a “problem” and sell a solution to make a profit.
I am not saying that such properties do not exist anymore but maybe you should write down a investment strategy in this market context.

Regards,
ErwanJG

Obviously cash-flow positive properties are particularly difficult to find in the current Sydney market (where most people look for capital gains rather than good rental return) but if you look good and hard one will turn up… eventually.

Looking in cheaper areas of Sydney (or outside Sydney) – where the property itself is less expensive is a start. Also find areas where people either earn a lower pay packet (so they can’t afford to buy and must rent) or work primarily in casual/contract employment (in which case they may earn a fair amount but are unable to get financing). Of course – cheaper housing/tenants may mean you find yourself with greater repair expenses… gotta weight it up for yourself.

Now is probably a good time to buy slightly run down places that a slap of paint etc will fix – whereby you can quickly increase the value of the property to tenants. When the market was hotter these places were always snapped up by builders who did a quick reno and on sold a couple months later – obviously with the slower market they cannot afford to do this anymore. This is not recommended if you have no experience in fixing places up, as costs can quickly blow out.

You could also consider a vendor finance/wrap option for immediate positive cash flow. I haven’t tried this, but obviously Steve has to great success.

Also – regarding your research – best properties in Sydney often get snapped up prior to internet listing. Better to develop a relationship with agents so that you’re on the inner circle – or think creative and start popping your details into the letter boxes of houses you think might be of interest to you. Offer a fair price that is a bit less than the open market but more than they would get if they went through a real estate agent (who takes a commission).

Good luck