I just ran into a 3 bedroom house property in a town of 8,000 people with a total of around 2,800 houses in the town.
The land is half an acre which can be subdivided into two blocks, one with a house and the second block would be just vacant land.
The house needs to be painted and needs a general sprucing up and can be rented for around $ 130 p.w.
The property can be purchased for a total of around $ 70 K (with the vacant land supposedly worth around $ 20 K).
In another town of about 4,000 people (with about 1,000 houses in the town) there are a couple of blocks of vacant land for sale for $ 12,000 each.
Well of course one could not possibly create a block for that kind of money because the services would cost a lot more than that.
Could any of the above possibly be a proposition ?
Jane Wilson
Hi Jane. It depends on the town. While the figures look like they add up okay what do you know about the town. Is its population growing, declining, stable? What are the major employers there and are any of them expanding or closing. What plans do the council have for development in the future. Have you visited the town? Are all the shops in town tenanted or are some closed up and vacant? Out of the 8,000 people there what % rent?
Sorry to bombard you with questions but in my opinion, these are the things you need to know if you want to be sure its a good IP to buy especially if buying in a regional town. Otherwise it’s all just pot luck!
Regards,
Karan.JaneW150,
Unless you have enough equity in other properties or you have enough cash to pay for those deal, you will find that lenders will not lent on properties in a regional centre of less than 10,000 people on 80%LVR.
On the vacant properies, what are you plan after you purchased them? Remember, vacant lands will not give you any returns?Cheers
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