I'm selling my house!!

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From: Paul Guest


Inspired by the strength of the market, my wife and I have decided to sell and attempt larger developments than this particular one.

What I cannot do is budge my wife from this new property in Mitcham (best street in suburb!) so we wish to sell on a 3 year lease-back (i.e. We'll rent it back for 3 years). No agents fees (direct debit our account each month), no vacancies, no re-letting fees, no advertising, no maintenance for first 3 years (we figured that we would have to cover that if we were living here anyway). Plenty of depreciation ($42K, maybe more) and building w/off ($115K). We'll offer a 5% rent increase in the 3rd year.

Price is $360K (larger house next door valued at $500K, auction in the street 3 months ago at $468K (market has risen since).

House is 15sq on 370m2 block. 3 beds, ensuite, + dble gge, picket fence, fireplace etc.etc. Only 2 on the block, both have a 50ft frontage to elm-lined street.

Yields in our area on new stock are around 4.5%. Our return is 4.75% but without vacancy, fees, maintenance etc. for 3 years, our offer grosses up to about 5.5% when those assumptions are factored in.

Sorry for the 'spam' guys but try explaining yield, depreciation and the like to an estate agent.. they just dont get it!

Please email [email protected]

Thanks

Paul.

PS. I am happy to provide any property development advice to newcomers (risk/reward, ROI, funding, target markets etc.)
 
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Reply: 2
From: GoAnna !


Paul

Can I ask how you came up with the valuation of $360K? And the rental rate.

GoAnna !
Why not go out on a limb, that's where all the fruit is. (Mark Twain)
 
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Reply: 2.1
From: Paul Guest


GoAnna,

The valuation will be fine at $360K. I am very familiar with all the agents and recent sales in the area. I have taken inspections from 3 or 4 agents in the area and have sold 3 properties in neighbouring suburbs in the last 7 days.

To the previous enquirer, Mitcham, Victoria (Melbourne suburb).

Paul
 
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Reply: 3
From: Michael Yardney


Mitcham is an outer eastern suburb, in act quite far out.
What capital growth do you expect to get there?
Michael Yardney
Metropole Properties
 
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Reply: 3.1
From: Paul Guest


Thanks Michael,

As the crow flies it is about 20k's out from the CBD. The Eastern freeway extension is a 5 minute drive and then an 11min trip to Hoddle St. Mitcham had experienced a surge since the completion of the freeway as have other suburbs within reach of it.

This particular street is very tightly held, with 60yo pin-oak trees. the Council have just completed a re-construction of the street to preserve the trees and enhance the area with old bluestone-lined gutters and driveways - the only street in the suburb to attract Council funds for this purpose.

pg
 
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