A little pop-quiz for you.
Which property do you think makes the better investment?
This is a ‘Dollars and Sense’ store, leased by a popular franchise in Queensland.
It was bought by an investor recently for $1,050,000 with a 7-year lease in place.
The net positive cashflow is 11.4%.
So, it’s set to give the investor a healthy around $60,000 per year in passive income.
That’s net income – after loan repayments and other property related expenses such as strata etc.
Now compare that to a property in Sydney’s west.
This was sold last year for $1,131,000 – so about $80,000 more than the previous example.
This would rent for about $430 a week, so it be would generally be negative positive cashflow for an investor – just on the loan repayments alone.
Not only that, you’ve got the maintenance costs etc. which really add up.
All that being the case, this property could cost as much as $18,000 per year to hold.
Now, it could be argued the Sydney property has more capital growth potential, or perhaps the site could be a development opportunity.
Both valid points.
However, certainly for some investors…$60,000 in the hand is better than losing $20,000 per year in the hope of a future capital gain.
Anyway, I just shared this with you to give you a different perspective on how to find the best ‘cash-positive’ return in the current investment landscape.
If you want to discover more make sure you attend this webcast tonight…