HOME OR INVESTMENT? PLEASE HELP US DECIDE!
The Client
Nadia and Jon are a young couple with one child and busy full time jobs. Like many young couples they had fallen in love with the suburb they rent in and while buying a home in this area was out of their budget, they wanted to get a foothold in the Melbourne property market. However they weren’t sure what that looked like. Would they become happy home-owners or rent-investors?
The Challenge
- Needed help to decide if they would invest or buy a home.
- Lockdowns, covid and a fast moving market
- A relatively small budget to buy a quality property
What We Did
Once engaged to represent them in their search, we undertook a thorough strategy session to set out the path to property ownership. We needed to help Nadia and Jon to decide if homeownership or becoming property investors was the right step forward.
We had different parameters to work with for each scenario. The first thing we did was prepare an area analysis for the couple to consider home ownership. Over the course of 3 weekends we sent the couple to a range of suburbs to look at and consider if they could see themselves living there. After a few weekly mentoring sessions and area excursions the couple determined that they wanted to continue to live inner city and would instead invest their savings into an investment property.
A new strategy and budget parameters meant a second area analysis. Once we had provided the couple with our recommendation for the area and property type, the couple began their search under our expert guidance using our Mentored Search service.
The Outcome
- Superior property and street in Metro- Melbourne for under $550,000
- Short walk to train and shops
- Walk-in-ready investment with 3.6% rental yield
- Negotiated a quick purchase with a motivated vendor
A number of great properties had caught our attention so the time was ripe to hit the phones and find a motivated vendor we could negotiate with privately and avoid the uncertainty of the auction market at that time.
Perfectly positioned in a great street, we secured an original house at the front on a subdivided block. The fully updated two bedroom property had an excellent land size of over 250 m2 including the front yard on title and with a generous and private back yard.
At a time when these properties were heading towards $600k, we bought for $536,000.
Even better, when our boutique rental agency took over the leasing reins a quality tenant was found within a week and at $20 more per week than we had estimated, improving the rental return for our young clients to 3.6%.
In depth knowledge of suburbs | Negotiation skills | Money saved
Market Value -$560,000 | Negotiated Price $536,000 | Money Saved = $24,000 | Rental yield 3.6% achieved
