This edition of the vault shows how lucrative it can be to follow market cycles and strike when the iron is hot.
BOUGHT FOR $190K, NOW WORTH $280K
Purchased only two years ago, in 2013, this three bedroom, Gold Coast villa has increased by almost $100,000 in value. At the time of purchase, rent was being charged at $330 per week. In two years this has increased to $360, giving this property a 9.5% yield.
WATCH MARKET CYCLE TRENDS
Before the Global Financial Crisis, villas in this complex were being sold for anywhere between $320,000 to $350,000. Their value dropped to the $200,000 mark and has been rising again ever since.
BUYING AT THE RIGHT TIME AND THE RIGHT PLACE
We purchased this villa from the vault under market value, which was around $220,000 to $230,000, at a time when property prices were just starting to rise. The Queensland market is one that promises great potential. Currently, it is highly undervalued and in the point of a growth cycle that is predicted to go up like the Sydney market. The Gold Coast in particular is a very good growth location.
THE FOUNDATIONS OF FINANCIAL FREEDOM
This villa is an excellent foundation property because it was bought below market value, has a good upside for growth, a very low entry price and a good rental return – all in a good growth location. Buying a property such as this, that ticks all the boxes, is a step in the right direction for investors. If you can build a portfolio on several of these low risk investments, you will be well and truly on your way to telling your boss where to go.
How has following market cycles impacted on your investing? Please share your experiences in the comments section below.