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Jordan Springs | Five Investor Case Studies

August 21, 2012 4:56 pm
posted by James Parnwell

Jordan Springs Case StudiesI have had five clients purchase investment properties in Jordan Springs over the last year and they have all had strong results. Here are their success stories, I have kept their names confidential for their benefit, however please feel free to contact me if you would like me to outline any further details.

Jordan Springs Case Study 1

These clients live in the lower Blue Mountains and purchased a 4 bedroom investment property in Jordan Springs in April 2011. The house and land package they purchased was $435,000. The house was then constructed, completed and now tenants are living there. The property is now worth between $495,000 and $510,000 and is being rented for $495 per week. So let’s assume they could sell the house for the lower amount of $495,000…

– Capital Gain $60,000

– Capital Growth 13.7%

– Rental Return 5.92%

This couple have a loan of $435,000. Their interest rate is 6%, so their weekly repayment is $501. Given that their rent is $495 you can see that they are only behind by $6 prior to getting the tax deductions. They estimate that their combined tax back for the property will be $7,500 in the first year. So this investment is cash-flow positive from day one! In other words, they will make extra income from the rent and tax deductions on this property from day one. Also, they have already made a capital gain of $60,000.

 

Jordan Springs Case Study 2

These guys are a young married couple who live in Sydney’s Northern Suburbs. They purchased a very similar property to the couple from Case Study 1, it has 4 bedrooms and the house and land package cost $439,000. Once the construction was completed they have rented the property out for $510 per week. They wanted to get top rental dollar rent and so were happy to wait a little longer to get higher rent. The property is now worth between $500,000 and $515,000…

– Capital Gain $61,000

– Capital Growth 13.8%

– Rental Return 6.04%

These guys have a loan for $389,000 because they had saved a deposit to put on the investment. They are paying 6% interest which means their weekly interest payment is $506, so they are $4 per week ahead of their repayment at the moment. They also need to pay for their rates, insurances and the like, however they expect to get a tax return back of approximately $10,000. They are well and truly cash-flow positive on this property not to mention the $61,000 capital gain they have already made. In fact, they have been in contact with me to start the ball rolling on their second investment property.

 

Jordan Springs Case Study 3

These clients live in the Katoomba area and purchased a house and land package very similare to the couples in Case Study 1 & 2. It cost $435,000 for a 4 bedroom home in Jordan Springs. They purchased it in March 2011. They wanted to get a tenant in very quickly so accepted a weekly rental of $470. This property is also worth between $495,000 and $510,000.

– Capital Gain $60,000

– Capital Growth 13.7%

– Rental Return 5.62%

Both are paying tax and expect a return of about $9,000. So given they expect to be cash-flow positive in the first year of owning this property.

 

Jordan Springs Case Study 4

Another married couple from Sydney purchased a very similar property to the first three case studies. It was also a 4 bedroom house and land package and cost $435,000. They kicked off the purchase process in March 2011. They managed to get top dollar for their rent at $520 per week and have also been told that they would sell their property for about $495,000 – $510,000.

– Capital Gain $60,000

– Capital Growth 13.7%

– Rental Return 6.22%

They are very much in a cash flow positive scenario here where the rent and tax deduction more than pay for the costs of owning the property.

 

Jordan Springs Case Study 5

The final couple are in a slightly different property to the others. It is a 5 bedroom two storey house which cost $485,000. It is estimated that it is now worth $555,000 now and they receive $540 per week rent.

– Capital Gain $70,000

– Capital Growth 13.7%

– Rental Return 5.79%

The repayments on $485,000 would be $559 per week, so they are behind by $19 per week, once the other expenses are added in and the tax deduction taken out they still expect to be cash-flow positive. They have made $70,000 in growth already plus some extra money in the bank in the short-term perhaps to start saving for another investment property.

Article by James Parnwell

Summary

I guess it is all of the positive information I have seen from clients who have taken the jump to get in to Jordan Springs that has prompted me to write these articles. They have all seen positive cash-flow and growth in the value of the property. If you would like to have a look at a market overview of Jordan Springs click on this link.

If you would like some further information on anything related to Investment Property or Investment Finance please click contact us

One of our team of experienced Investment Property coaches or Investment Finance Mortgage Brokers will be happy to reply to you with some specific and helpful adviceā€¦

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  2. […] how is Jordan Springs performing as an investment overall? Here is some data from the case studies I wrote about recently compared with some surrounding […]

  3. […] following is a breakdown of the rental return for the Case Studies outlines […]