26 Year Old Finds Creative Way To Buy First Home & Make $400k.

26-year-old-buy-first-home

 

"Binvested came up with a solution that I wouldn’t have thought of otherwise”.

Rochelle

B InvestedAre you ready for results like these?

Do you want to achieve financial freedom by investing in property?

Get Started Today

The Journey

At the start of her 20’s, Rochelle realized she didn’t want to work her entire life and was determined to find a way to exit the rat race early.

She wanted a life filled with special moments, not a blur of suits and desks. However, she didn’t want to compromise on her lifestyle – and dreams of a family.

 

PUTTING INVESTMENT FIRST 

Rochelle knew she had to be smarter with her money, and make it work for her – not the other way around. Property investment was the obvious answer.

Starting with baby steps, she bought an investment property before her 25th birthday.  The Binvested buyer’s agency found a unit in Labrador QLD with a positive cash flow, and good growth prospects.

Costing her just $245,000, the move paid off – 2 years later similar properties are selling for $280,000 to $300,000.

The numbers for this particular property are below;

 

Investment purchase cost: $245,000

Buyers Agency Fee: $9,900

Investment market value: $280,000 – $300,000

Net Position: $55,000 equity and $370 per week rent

 

HOME SECOND

With plans to get married, a home of her own became a need. Realizing that this would probably be the biggest expense in life, she devised a strategy to get her into her own home sooner, and with a much smaller mortgage.

Instead of buying a home off-the-plan at a premium price, she decided to buy land and arrange building separately.

Rochelle says “It’s better not to get emotional, rush in and then spend your whole life paying off your mortgage”

By deconstructing the deal this way, she knew she could get a much better price – which was not inflated by hefty sales and marketing costs.

Once again she used the Binvested buyer’s agency to purchase a property at a discount. The property was some land with an old existing dwelling on it. The property was bought for $525,000 and just 6 months later it was revalued by her bank at $590,000.  This is $65,000 in equity that can be used as a deposit for the build.

But Rochelle didn’t stop there. She figured she can reduce her costs even more if she demolished the existing dwelling and replaced it with a new duplex. By building two houses, instead of just one, she could sell or rent one to cover her costs of living in the other one.

With this approach Rochelle looks to make $450,000 in net equity by the time the project is finished.

Here is the breakdown of the numbers on this particular project based on current prices and market value;

 

Land costs: $525,000

Demolition cost:  $20,000

Buyers Agency Fee: $16,500

Build cost: $482,000

Total cost: $1,043,500

Completed Dwelling Value: $750,000 each or $1,500,000 together

Completed Dwelling Rental: $550 a week per dwelling ($1,100 total)

Net Position: $456,000 equity and $28,600 annual rental income per dwelling ($57,000 total)

 

DELAYING GRATIFICATION

Although she will be moving into her very own 4 bedroom home very soon, her strategy doesn’t stop there.

“Ultimately, my end goal is to buy more properties and use the profits to fund a dream home down the line. I want to retire early and use the passive income from my properties to fund my new found freedom” says Rochelle.

Experience has taught her the value of delaying gratification “A lot of my friends are buying expensive cars and shopping online each week. I would rather put my money towards something that will make me more money”.

However making sacrifices doesn’t mean you have to live in deprivation with Rochelle saying,

“I still go out for brunch occasionally, but I’ll order the $9 item instead of the $30 deluxe breakfast. I love to travel overseas, but I choose cheaper destinations and wait for amazing flight sales. I’ve never felt like I am depriving myself. You just have to be a really good bargain hunter. I live for great deals”.

 

STEEP LEARNING CURVE

Although in her mid-20’s, Rochelle has already done more in property than many people will do in a lifetime.

Rochelle admits it was hard to find advice from her peer group and relatives. They didn’t have the experience to guide me in the right direction.

That’s where partnering with a buyers agency became critical;

“They listened to my limitations and desires and came up with a solution that I wouldn’t have thought of otherwise”.

She admits that having to pay an agent to find a home was a big decision. However, she very quickly saw the value. It was the best move to make if she wanted get the right properties from the start and use each as a stepping stone to the next.

“You need to look at what the fee will get you in the long run. I could have made maybe $50,000 on my own as opposed to over $500,000 through a buyer’s agent“.

 

ARE YOU LOOKING TO BUY?

If you are in the market for your next home than speak to us. Find out how you could be getting more for your buck and reducing your home ownership costs without sacrificing on style.

Start Your Journey to Financial Freedom

Contact Us Today

Learn more from our success stories

Melissa and Andrew

"Binvested has been instrumental in changing our mindset. We now look at investment and living in a whole different way".

See Full Case Study >

Rochelle

"Binvested came up with a solution that I wouldn’t have thought of otherwise”.

See Full Case Study >

Related Articles

How Has Covid-19 Affected Your Superannuation?

How Has Covid-19 Affected Your Superannuation – And How Do You Get Back On Track? The coronavirus pandemic and subsequent lockdown has shaken up superannuation in several significant ways. First, it sent the earnings of companies into a tailspin and caused havoc in the market for fund managers, with assets under management falling nearly 8%… Read more »

Read More >

2020 Tax Returns – What You Should Know.

2020 Tax Returns – How Will They be Different To Last Year? Just about every new financial year, there will be some kind of tweak to taxation laws, which have often been announced on the previous year’s Federal Budget night, then argued about, amended and voted into legislation by the nation’s politicians, before eventually arriving… Read more »

Read More >

Tax Returns For Property Investors

How is my tax return affected now that I’m a property investor? Making the decision to invest in property can seem like a never-ending list of upfront expenses, so you’ll be pleased to know that when the end of the financial year rolls around, you can get the tax man working for you for a… Read more »

Read More >

Find Out How We Can Help You...

Buy your first home

Binvested Find Out More >

Invest in property

Binvested Find Out More >

Build your Portfolio

Binvested Find Out More >