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Deals and Don’ts October

Wednesday, 5th Oct 2016

In this section we take a look at just some of the different properties on the market and explain why they’re either deals (that represent a good investment) or don’ts (that should be carefully avoided by investors).

Deals

Burswood

Purchase price: $925,000
Purchase date: August 2016
Block size: 1,012sqm
Specification: 3 bedroom, 1 bathroom, 1 car bay house built in 1952. Zoned R40.

Deal: This property represents a good purchase because of its low price point (relative to the suburb) and development potential of the block. It’s very rare to find such development sites within 2km of the Perth CBD. The property presents well and has been subject to some minor renovations meaning it’s in rentable condition. This would allow an investor to land bank for future development if they don’t want to develop now.

South Lake
Purchase price: $420,000
Purchase date: August 2016
Block size: 723sqm
Specification: 3 bedroom, 1 bathroom, double car port house built in 1988. Zoned R20 (draft R60) on a corner lot.

Deal: This property represents a good deal because of its value for money as it was purchased under market value. The house has been renovated and is well presented on a good corner location opposite a school. The draft R60 zoning allows for potential future development subject to council approval.

Woodvale
Purchase price: $585,000
Purchase date: August 2016
Block size: 721sqm block
Specification: 4 bedroom, 2 bathroom, single carport, double-storey house built in 1981 with a pool. Zoned R20/60.

Deal: This represents a good deal because of the property’s development potential and location being nearby the local train station. While quite basic, the house is well presented and quite large being a double-storey family home.

Don’t

Success
For sale price: $470,000
Specification: 2 bedroom, 2 bathroom, 2 car bay apartment

DON’T: This property is a deal breaker for several reasons. Firstly, it’s in a high-supply area with many similar dwellings in close proximity and brand new apartment complexes being built nearby. This supply will limit capital growth as supply and demand will remain relatively in balance. The apartment complex also comprises many joint owners with state housing. The property has also been on the market for 425 days highlighting that it is overpriced.