There has been a lot of discussion lately about Cashflow and Growth, which one is better?
Why not structure your next Real Estate Investment so that you have BOTH…?
Yes, this can be done, Duplex dwellings provide the ideal opportunity to have great Cashflow due to two dwellings being positioned on one piece of land, hence reducing land cost for each. The resultant rental income is invariably better than a single dwelling on a single lot.
But here comes the double whammy (pardon the pun). By leaving the two dwellings on one title you keep your land rates low and whenever you are ready you strata title the land and thereby generate instant equity.
It is hence very important in the design and specification process, to specify the provision of services such as gas, electricity, water etc, to be completely separate for each dwelling.
Until the strata title, there is no requirements for a Body Corporate and even thereafter, with a bit of understanding between the two home owners, the set up and costing can be kept to an absolute minimum, by dedicating as much as possible exclusive use areas.
In a best case scenario with two street frontages, this can lead to just about no common areas, where a letter box space may be sufficient.
The resultant rental yields of often 6+ % are not uncommon, not to talk about capital gain due to the eventual strata generating several $10,000 worth of “manufactured equity”.
Who doesn’t like 6% rental yield and still massive capital gains?
Property Friends has regularly got such packages available, we love to have our cake and eat it too J
Property Friends is a specialist Property Investment Advocacy that has been operating for the last 13 years on the basis of 3 principles: Trust, Community & Progress.
www.propertyfriends.com.au 03 9758 5331