CASHCOW (20.35% YIELD), EQUITY (34% UNDER CV), 20% VF POSS

Listing Number:  1295
Posting Date:  25 November 2008






 
Price:$795K plus GST and finders fee 9995
Listing:CASHCOW (20.35% YIELD), EQUITY (34% UNDER CV), 20% VF POSS
Type:Unit/Flat
Category:Assignment
Bedrooms:2
Bathrooms:1
Region:Otago
Site Area:560 m2
Address: Login
Building Area:1192 m2
Property Image

Description:

I think the bank manager will even be rubbing his hands at this one.

10 x 2bdm units on own titles within easy walk to the CBD and Queens Park (Botanical Gardens). These units are in excellent condition and have been used as motel accommodation but can be sold separately or operated as 10 x rentals. Invercargill has a thriving economic outlook and demand for rental accomodation is good. These fully furnished units, some with 2 x double bedrooms make ideal rental units and property managers (3 companies used) have appraised the rent at an average of $380 per week for each unit - I have used $350 for the calculations (average of lowest figure - see attached appraisals). I have a 2 bedroom fully furnished unit in Invercargill and it rents for this amount but these are closer to town. All units have open plan living, dinette or kitchen and separate bathroom; with access to the unit by ranch slider from your balcony area. Chattels list is extensive.
Currently there is access via two driveways. To separate the managers house from the units just requires a fence to be erected and costs could be shared - cost would be approx $3000 and halved if agreed by neighbour. To provide separate power meters an estimate of $200-300 per unit has been given. There is also a separate 30sqm powered shed located next to the ample parking area that could house a launding area for the tenants if required and you could rent out storage space providing extra cashflow. 3 x washing machines and 3 x dryers would cost approx $3200 total.

The vendor is prepared to leave 20% vendor finance in the deal. As an investment this stacks up nicely.
CV -$1.346M
PP - $795000 (plus GST and finders fee of $9995)
Rent -$3500 pw, $182000 pa
Yield - 20.35%
Rates - $8876.10
90% Loan of $894375 (795K + GST) = $804937.50@8.5% IO = $68419.6875pa = HUGE Cashflow!!!

Do the numbers!!! Even at conservative vacancy rates this stacks up and you need to read up on what's projected for Invercargill. It has a very bright future!

Vendor Finance: Vendor prepared to leave VF of 20% in for 5 years at current floating rate.

But there's more: There is a 3 bm modern house c/w office and 4 modern units currently being operated as a motel. These are also for sale and you could pick the whole lot up for $1.3M (1x3 bdm house and 14 units). See my other listing (56 Thomson Street)


Additional Documents:

Click to Download
Description: Rent Appraisals
File Size: 119 Kilobytes
Click to Download
Description: Power Meter Estimate
File Size: 73 Kilobytes