[THE VAULT] BLUE CHIP PARRAMATTA INVESTMENT UNIT BOUGHT $30K BELOW VALUE
In this week’s Vault, we visit a two-bedroom unit located in Parramatta – “Sydney’s second CBD.” Purchased in 2014, this investment has experienced impressive growth while bringing in strong rent.
BOUGHT AT THE BOTTOM OF THE MARKET CYCLE
Going back five years before purchase, apartments here were worth around $330,000 to $340,000. The market dropped, with comparable sales around $290,000 at the time of purchase.
BOUGHT BELOW MARKET VALUE
We picked up this apartment for $260,000 – around $30,000 below market value. The investor who purchased this property did so with the intention of living there for awhile. At the time, renting and buying were roughly the same weekly price.
BOUGHT IN THE RIGHT LOCATION
Parramatta is often called “Sydney’s second CBD.” It is a thriving centre that offers good growth and consistent rental demand. This particular property is located close to public transport and shops – an ideal place for attracting tenants.
SO, HOW MUCH IS IT WORTH NOW?
Apartments in this complex are currently selling for around $500,000. This one brings in $400 weekly rent, it is modern, has depreciation and sits in a blue-chip location primed for capital growth.
INVESTING TO BRING YOU CLOSER TO YOUR DREAM
Investors such as this one have got it all figured out. Instead of getting a huge mortgage for a house, and paying it off for the rest of their lives, they build an investment portfolio with properties they can afford. They purchased under market value, in high growth areas with a self-sustaining cash flow. As their capital increases, they invest in more, building up their asset base and setting themselves up for financial freedom well before retirement age. Before they know it, they are able to buy a better house for themselves than what they could have afforded at the start of their investing journey.
By using the right structure and investing in line with their goals and what they can afford, they are maximizing their financial opportunities in order to reach a point where they can say goodbye to their boss and live life on their terms.
Have you chosen to invest first and buy your principal place of residence later? Please share your experiences in the comments section below.