Just a general question here, what price range for residential property(particuarly houses) recieves the highest yield.
I’ve heard recently that the rent per week for a 400K should be 300-400 a week. But for a 200K its like 250. which leaves the 400K one with around about 4.55% yield. But with the 200K one its more like 6.5%
4.5% to 6.5%. Why would you buy a 400k property, i know more capital gains in % terms but if you buy 2 200K ones then you get he same cap gains(not exaclty) and you also benefit from much more rent.
Hmm, whats you take on this everyone.Christopher “High spirited” Fife.
I think generally lower valued properties have higher yields. I too would generally rather get 2 x smaller proeprties than one big one. But it would depend on the area and proeprties
Terryw
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Originally posted by DraconisV:Just a general question here, what price range for residential property(particuarly houses) recieves the highest yield.
I’ve heard recently that the rent per week for a 400K should be 300-400 a week. But for a 200K its like 250. which leaves the 400K one with around about 4.55% yield. But with the 200K one its more like 6.5%
Where are you getting these figures from? They are completely meaningless. There are properties worth $2million that rent for $3,000 per week, and properties for $100,000 that rent for $80 per week. It depends on where the property is, what condition it is in, what facilities it is near, etc etc etc. There is no generalisation that says a particular price range gives a better yield.
4.5% to 6.5%. Why would you buy a 400k property, i know more capital gains in % terms but if you buy 2 200K ones then you get he same cap gains(not exaclty) and you also benefit from much more rent.You have completely contradicted yourself. You cant say “I know more capital gains in % terms” and then say “you will get the same cap gains”. It makes no sense. You are again making generalisations about a price range that are meaningless. A $1million property can grow at 20% pa and a dump worth $80k can grow at .5%. You need to forget about being this specific, you cant see the forrest for the trees. Go to realestate.com.au, look at different rents for different locations for certain houses, then go see how much similar houses might be worth. At your stage I would suggest not even worrying about things like this.
Go read all you can find from the following authors:
Margaret Lomas
Jan Somers
Peter Spann
Craig Turnbull
Noel Whittaker
Terry RyderPlow your way through those books, you will learn a tremendous amount from a few different viewpoints. Some are aggressive, some are more conservative. Learn where you fit in with your own feelings towards risk. Develop an overall plan and strategy.
Then after this start looking at properties in areas and of the type that fit in with your preferred strategy. Research how much things actually go for (not the rubbish estimates you have posted previously, they are meaningless), research market rents of that area. Then get your finance sorted out (you will know a lot more about this after reading the above books). Then start looking at specific properties. Forget about what colour you are going to paint the house, until you know what house you are going to buy and how you are going to buy it.
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