Introduction
Since the mining boom ended in late 2015/early 2016, we have seen house prices crash by around 23%. Put it this way, losing $100k in your house value has been typical for most investors. Because of this, a lot of property investors have become bitter and sour, and turned their back from the WA property market.
I am here to bring you the good news, that it is not all doom and gloom. As a Buyer’s Agent, my job is to help investors buy a great quality property and make money when doing it. I service clients with various investing needs: from quick equity growth (such as flipping), to buy-and-hold. And all of my buyers so far, have made pretty decent return on their purchase.
Over the last year, people have said that there is no money to be made (at all) in the WA property market. In fact most tell me you can very well lose money. However my experience has been that if you buy right, you can easily make money. In fact, if you want to invest in WA property, NOW IS THE TIME! With the prices at the lowest, with rental prices tightening, you are in for a win!
Let me share with you a couple of purchases I’ve made.
$415k Renovation-Flip Project, Now Under Offer at $670k
A client of mine is a very savvy investor. He has already had, close to 10 properties under his belt prior to coming to me. To-date, he has always been buying using the good-old-strategy: buy, hold then hope for the best. He has always had his eyes on property investing. He has purchased both within Australia and overseas. His dad is also a property builder. He has always said to me, “Tommy, if you find anything interesting, let me know”.
So, as a Buyer’s Agent, I crawl thousands of properties daily. When I finally stumbled across this particular opportunity, asking $415,000 for a 4 bedroom, 1 bathroom property in City of South Perth, I know straight away this is a goldmine. Why? Because 4x2s in the area have sold for at least $650k. The strategy is simple, that is to renovate and make it a 4×2.
Long story short, I presented the property to him, together with the projected profit calculation and CMA (Comparable Market Analysis), and immediately he was very keen. He was overseas at the time and I helped him with all the purchase arrangements and process. Long story short, we bought the property, my buyer only needed to come up with the money. Everything else (renovation, etc) was project managed. We bought the property in Feb 2019. By August 2019, 4 weeks into the sale period, the property was under offer for $670k. My buyer spent about $100-$110k with the renovation. Safe to say, he made $100k profit in 6-7 months.
7% Yield, Potential Sub-Division, $100k in Your Backyard
What about this deal? 4 bedroom, 1 bathroom property already renovated, 801sqm with R25/40 zoning. The existing house is located at the front side of the land, it has enough side access and space for rear-subdivision. We purchased this for $205k! Property is located at about 24km from Perth CBD, with 200m away from train station, it will take you straight to Wellington Perth Train Station in 30mins.
What’s so special about this property is, for $205k, based on 2019’s comparable sales, you are basically paying just for the front house. Since this property allows you to do rear subdivision, on the rising market, you can flip the rear for at least $100k profit.
Now, until the market rises again, you have to make sure that you can hold the property without it costing you too much money. And guess what, this property has attracted tenants who are willing to pay $280/week+. Meaning, if you take $205k purchase price, it is a 7.1% gross rental yield. With this much yield, it shouldn’t cost you too much (in fact, you might be in for some positive gearing) to hold.
Conclusion
There is money to be made in the WA Property Market. Hands down, now is the time to buy and make money. If you are serious in making money through property investing, let’s have a chat. I can share tons of knowledge and information on the WA property market so you can setup your own Money-Mine.
For a full list of purchase properties to-date, please go to my website https://easybuyer.com.au/portfolio.
You can reach me by email [email protected]
By: Tommy Segoro, Principal Consultant at Easy Buyer’s Agent
