I am looking at investing in a unit, this unit is in a development of 5 units. I will be buying it off the plan. Price for the unit is $85K, two bedrooms, garage, reasonable sized living areas, approx. 70m² including bedrooms. I've done a bit of home work with the local real estate agent and they think that I would be able to get $130p/w being conservative. As I have minimal experience in property investing I ask all you investors out there is this a good investment or not?
I would appreciate if you could show me some working out (percentage) as to what sort of return I would be getting.This sort of investment relies on having either a retirement demographic for the area or a just starting out young people type demographic. These types of people generate demand.
You have to decide are you after capital gain or cash flow in your investment strategy.
$130 a week = 6760
probably you will incur expenses like insurance, council rates, strata rates, water rates and repairs so guess of $2000
$6760-2000 = 47604760/ 85000 *100 = 5.6%
as a cash flow return compare 5.6% with what the interest costs will bealso check other similar properties rent in the area from real estate windows, web sites maybe
off plan = stay away in this current climate… unless you sure that you are buying a bargain
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