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Cash Flow Positive Dual Income Investment Property in High Growth Areas
Pay off your mortgage in record time and build an income of at least $83,200 pa by buying only 4 dual income investment properties...
Dual income property helps you achieve your goals sooner...
- Cash flow positive $100-$200 per week from day one.
- Brand new, 100% turnkey with no maintenance.
- Stamp duty savings and maximum depreciation benefits.
- Dual Occupancy and Duplex options available.
- Located in South-East Queensland's booming growth corridors.
DUAL INCOME INVESTMENT PROPERTY
POSITIVE CASH FLOW + CAPITAL GROWTH
Building a high growth, income producing property portfolio…
What sort of property should you buy and where?
Property investment, like any investment, is a numbers game in which your sole purpose is to achieve the best possible return on your money.
So while property is often lauded for being a tangible investment, one you can ‘see, touch and feel’, remember it’s the numbers you need to fall in love with, not the property.
Decisions must be based on maths, not emotion – after all, the only reason to invest is to make profit!
How to ‘beat the market’...
The ideal investment property is one with consistently high levels of capital growth and cash flow.
However, not all property is created equal – in fact, when comparing properties there’s often a significant difference in the amount of growth and income each produce.
So how do you find the top performing properties?
When it comes to residential property, the two major determining factors of capital growth and cash flow are;
Location and Property Type
LOCATION = CAPITAL GROWTH
The state, area, suburb and even street in which your property is located is by far the biggest factor in determining how fast your property will grow over time.
PROPERTY TYPE = CASH FLOW
In addition to location, the size and style [ie. house, unit, apartment etc.] of the property you purchase will have a big impact on the rental returns you’ll achieve.
The good news is with the assistance of respected independent research and fundamental analysis it is possible to ‘beat the market’ and identify locations and properties likely to achieve better-than-average capital growth and cash flow!
1. Finding the right location...
It’s simple, if you buy property in higher growth areas you will make more money!
Using the Rule of 72 we can quickly estimate the number of years it will take for a property to double in value based on a given annual rate of capital growth.
For example, if a property grows at an average rate of 4% pa. it will take 18 years for it to double in value [72/4 = 18 years].
In contrast, if a property experiences 8% annual capital growth it will only take 9 years to double in value [72/8 = 9 years]. That’s quite a difference!
So how much capital growth can you expect to achieve when investing in property?
Here’s how the 5 biggest capital cities in Australia performed over the past 35 years;
Despite the obvious fluctuations, each capital city has achieved a compounding capital growth rate of over 7.4% per annum.
This means property prices, on average, have doubled every 10 years!
Analysing the Fundamentals
The faster growing areas contain a range of fundamental growth drivers which lead to the higher levels of capital growth. These include; existing lifestyle amenities, high employment, strong infrastructure spend and population growth. Individually each of these elements can drive up the demand for real estate and place upward pressure on prices and rents. When combined, however, the resulting hotspot can generate above average growth for many years!
Supply & Demand and Cycles
Monitoring capital growth rates and changes in sales volumes [the number of properties that sell each month] is another effective way of identifying areas with the potential for better-than-average capital growth.
Sales volumes, in particular, can give you a good indication of the relative ‘supply & demand’ trends in various areas.
Generally speaking, an increase in sales volumes is evidence of a strengthening real estate market and is usually a good precursor to growing property prices.
Selecting a Property Hotspot
By bringing all of the research together it is possible to drill down and pinpoint the best locations [hotspots] to buy property in.
You are looking for the right mix of macro and mirco factors in order for the area to produce consistent & high levels of capital growth, both now and into the future.
This is the process we use to identify the best suburbs to invest in.
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2. Finding the right property...
The numbers tell us to invest in brand new turn-key residential property. Compared to established property, new property has stamp duty savings [house & land packages], much higher tax/depreciation benefits, increased tenant appeal [higher rent and lower vacancies], and little to no maintenance costs. This makes it an ideal ‘hands-free’ investment.
We also recommend you invest in houses with land - research shows that on average houses achieve higher levels of capital growth and rental returns when compared with units and apartments.
Dual Income Property
Dual income property is essentially a single property that’s made up of two separate homes, usually under the same roof, and on one single title. As the name suggest these properties produce two separate incomes.
Combined with the right location, these cash flow positive properties make the perfect investment – giving you both exceptional income AND capital growth!
Dual Occupancy vs Duplex Property
Dual income properties come in all shapes, sizes and configurations, however they’re usually classified as either a ‘Dual Occupancy’ [Dual Occ] or ‘Duplex’ property. Here’s a quick look at the difference;
Dual Occupancy
Two homes under the one roof and on one title. These properties often look like one large home from the front – the additional home is usually set back or located at the rear of the main home.
Common configurations include a 3 or 4 bedroom home paired with a 2 bedroom home [3+2] [4+2], or a 3 bedroom home combined with a 1 bedroom home [3+1].
Here’s what a typical Dual Occ floorplan looks like;
Duplex
Two homes on the one title but usually with a symmetrical façade that gives the appearance of two distinct homes connected by a common wall.
These properties are generally larger and therefore more expensive than a Dual Occ.
Common configurations include 4+4 and 3+3.
Here’s what a typical Duplex floorplan looks like;
Instant equity through re-titling!
Unlike Dual Occupancy properties, some Duplexes can be ‘re-titled’ – this means you can pay a fee to have an additional title issued so that each home has its own separate title.
The result is usually a sizeable increase in the value of the individual properties, not to mention the flexibility of being able to sell each home separately.
From a numbers perspective, you can usually buy a brand new Duplex on one title for around $100k less than the value of the two separately titled homes. So after re-titling costs of approximately $15k it’s possible you could end up with an instant equity gain of around $85k!
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DUAL INCOME PROPERTY EXAMPLE |
3+1 Dual Occupancy Package - Leichhardt, Ipswich QLD
This 4 bedroom [3+1] Dual Occupancy dwelling is located in an AV Jennings master planned estate in Leichhardt, right in the heart of Ipswich, Queensland
This thriving new community is close to great schools, shopping centres, transport, golf clubs and parks. Amberley RAAF Base and University of Southern Queensland’s Ipswich Campus are within easy reach, and it’s a short drive to Ipswich town centre [3km] or Brisbane’s CBD - or just a 5 minute walk to Wulkuraka train station.
The Brisbane-West growth corridor to Ipswich is currently one of QLD’s fastest growing regions.
Property Investment Analysis
Purchase Details
House Price: $296,600 [229 sqm]
Land Price: $175,500 [480 sqm]
TOTAL PRICE: $472,100
Rental Details
Rent: $540 pw [$330 + $210] 5.95% yield
CASH FLOW: +$207 pw [$10,764 pa]
Investment Return
1 Yr RETURN: $43,811 [$10,764 rent + $33,047 capital growth?]
10 Yr RETURN: 39.05% pa [total pre-tax compounding return on all money invested in the property over 10 years]
To purchase this property, you would need approximately $70,000 [@ 90% Lend] - $115,000 [@ 80% Lend] in available equity or cash.
Based on the numbers this property is cash flow positive $207/week [$10,764] in the first year, and including capital growth there’s a potential to make a gain of approx. $43K after just the first year.
This property is 100% turn-key and ready for tenant immediately - standard inclusions are; air-conditioning, blinds, security screens, full landscaping, fences, antennas, clothes line and letterbox. All council fees and charges [soil test and engineering] are covered by the builder and you get a 12-month maintenance period [for any defects] and a 20-year structural guarantee. There’s no hidden costs, surprises or extras for you to organise.
It pays to be cash flow positive...
The impact of owning just one cash flow positive property is huge! If you take the $207 pw positive cash flow in the example above and use it to make extra payments [$897 pm] on a $400,000 mortgage you’d save over 13 years and $143,929 in interest!
Here's a few more reasons why cash flow positive dual income property rocks... They’re cash flow positive from day one and you have lower rental vacancies as there’s two tenants; you can claim higher depreciation costs due to the doubling up of valuable items like kitchens; the extra income will improve your borrowing capacity which lets you buy more property sooner; if you're an owner occupier you can live in one home and use the rent from the other to pay off your home loan faster!
Now what? - Where to from here...
You generally have three options to choose from;
Procrastinate / Do nothing
Pay thousands more in interest and tax. Work your entire life only to end up on the pension [if there’s still one left!], needing to sell you family home just to survive;
DIY - Do It Yourself
Do you own research and hope you can buy the right property in the right area for the right price.
Work with Professionals!
Take action… Work with us to build a real property investment plan to retire early & financially free!
DIY vs Working with Professionals
While buy & hold property investing is simple, it’s not always easy – there are still a lot of moving parts you need to get right in order to achieve the very best results.
Here’s a snapshot of just a few of the elements involved;
- Performing Property Research
- Real Estate Contracts & Law
- Arranging Finance
- Property Settlement
- Property Inspections
- Record Keeping
- Regular Job
- Finding Suitable Property
- Ownership & Structuring
- Building Insurance
- Finding a Tenant
- Tribunal Hearings
- Tax Rulings
- Time Management
- Making an Offer
- Effective Tax Strategies
- Landlord Insurance
- Collecting Rent
- Mortgage Management
- Personal Tax Variations
- Family Time
…and there’s many more ‘what ifs’!
Life can be a cruel [and very expensive] teacher… even the smallest of mistakes now could end up costing you tens of thousands down the track.
Remember, it takes 9 years longer for a property growing at 4% to double in value compared to a property growing at 8% per annum.
That’s 9 years of capital growth you could miss out on just by buying in the wrong area!
Getting REAL Results!
Property investment is all about getting a result, not owning a multi-million dollar property portfolio.
It’s about bridging the gap from where you are currently to where you want to be, as quickly and safely as possible.
For most, that’s done by creating an ongoing ‘passive’ income stream which allows you to live a better quality of life – one with more options and choices – and less worry and stress!
What we do is provide you with the knowledge, tools and support to build a ‘market-beating’ high growth property portfolio which provides you with the level of passive income you desire!
Simply put, we help you build a personalised property investment plan and then we help you implement it!
What we do is find the best locations and property in Australia for investors seeking cash flow and capital growth. This includes Dual Occupancy property, Duplexes as well as off-market opportunities!
We do the hard work of finding the best quality builders at the lowest prices, as well as selecting the best properties and growth areas for you to consider.
All contracts are Fixed Price and every property is Turn-key and hassle free – this means they’re 100% complete [inside & out] and ready for tenants to move in.
There’s no hidden surprises or any extra money to be spent!
And unlike the property spruikers and investor groups we don’t sell our own property so you can be sure our advice is unbiased and independent!
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PS. A final word…
A lot of people are afflicted by the two mortal enemies of wealth creation; umm & aah. They second-guess themselves; they find reasons not to act; they listen to barbecue chatter and scare themselves silly. They find incredible excuses not to buy a property. There is nothing wrong with being cautious; there’s nothing wrong with checking and rechecking. However, I see millions of dollars in future wealth left on the table by investors who get cold feet. Don’t let fear rule your wealth creation dreams, take action today!
To a better financial future! Cheers, Sam
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