Hi, we are just starting out in this property investing stuff and this is a possibility for us. There are 2 houses for sale in our small town (1400 pop) that is halfway between two large regional centres. One of the houses is a 2br concrete home on a 2000m2 block which would rent for 100pw the asking price is $105,000, the other is right next door 4br in need of TLC on a 2500m2 block and the asking price is $85,000, it would rent for 110-120 p/w, I asked the local agent about this and she knows of two different couples who are desperate for a place to rent in this town and there is literally nothing to rent!
Our plan would be to buy one of the homes and rent it out immediately and then subdivide the block and transport a house that has been removed from another property and renovate that and rent it out nfor around the same price.
we have around $17,000 in savings to start.
What do you guys think? I am very interested to see the feedback that I get. this forum has given me so many ideas, have just finished Steve’s first book and starting the second, am trying to apply the problem+solution=profit theroy.
Thanks in advance[biggrin]collie
Originally posted by collie:There are 2 houses for sale in our small town (1400 pop) that is halfway between two large regional centres.
Hi Collie,
Firstly let me welcome you to the forum and I am sure you’ll get diverging opinions about the suitability of these properties as investments but…….
On the face of what you have said and for ‘me’ the town is too small. A population of 1400 leaves you susceptible to minor population and/or industry changes. I would prefer to put my hard earned into something of a little more substance.
You did indicate that ‘this town’ is half way between two larger centres. The critical issues is how far away are they and do these towns have much of an impact on ‘your town’?
Derek
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thanks for your reply. say we are comfortable investing in this town, what do you guys think of my subdividing idea?
collie
Hi Collie,
I tend to agree with Derek about the town being to small. I to come from a small town of 4500 people (not as small as yours)and have looked at many properties for sale. Most of them are absolute rubbish needing restumping and re-roofing, and they are way overpriced. Rental has also declined.
We decided to look closer to the coast and found a great town of about 13000 that is booming at the moment. House prices are a little more expensive but are better quality, more likely to be rented out and more easily sold. We have $17000 saved as well and felt it a much wiser decision to invest our hard earned cash in a larger town with more going for it.
All I can say is do your research. Make sure the town your buying in isn’t going to die. But if you feel comfortable investing there then go for it. [cap]
Ian
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