Case Study # 1:  Townhouse makes $146,000 equity in first 2 years*

Client at a glance:

• James & Yasemin

• Married 40 yr old couple with 3 children under 15 years old

• Occupations - Analyst and Chief Financial Officer

• Combined Income - Salaried employees $255,000 per annum

Property details:

• Location of new investment property - Pascoe Vale, Melbourne, Victoria

• Walking distance to train station, supermarket and local parks

• Easy CBD access via train or Tullamarine Freeway

• Property type - New Off The Plan  2 bed, 2 bath, 1 garage Townhouse

• Purchase price $479,000

Background:

• Had experienced equity increase in existing home and was looking to leverage from this and the high income tax currently being taken out of salary.

• Were expecting to need to contribute several hundred dollars per month to fund an investment property.

• James and Yasemin were happy to contribute up to $1,500 per month to create a portfolio of investment properties.

Objectives:

• Create an additional income stream

• Start building a portfolio of investment properties

• Accumulate capital growth and provide positive cash flow outcomes on each property within 2 to 3 years of purchasing

• Create financial security for their immediate family

• Provide the best possible education for their children

• Create wealth through property to allow an early retirement and a lifestyle that would include extensive overseas travel on a regular basis

Challenges:

• Working long hours with no visible gain due to high income tax being taken out of salary each month

• Not enough Superannuation to provide comfortable, early retirement in next 15 years

• Not knowing how to get started with property investing

• Confused as to what type of property to buy and where to buy

• Totally in the dark as to how the tax stuff works for property investment

• Unsure how & where to find an accountant well versed in property investing

• Didn’t know who to trust, who to engage as a property specialist and how to get started

Solution:

• A mortgage broker introduced James and Yasemin to Darryl Simms and during the first strategy session James and Yasemin had a strong feeling that they were in good hands and engaged Darryl to provide a shortlist of recommended properties

• Within 3 days of that first meeting they were the proud owners of their first high quality investment property and itching to buy more

Outcome/results:

• $61,000* equity gain during 13 month construction phase

• $146,000* total equity gain between 28th Aug 2015 purchase and Dec 2017

• Continued strong capital growth expected due to excellent location and strong demand in the area for quality townhouses

• Purchased below market value and saved $13,704 on stamp duty

• Low cash deposit used for first few weeks whilst finance broker arranged 100% finance for the investment purchase (by releasing equity in existing home)

• Property tenanted within 5 days of settlement

• Outstanding rental returns making the property cash flow positive  

• At James’ and Yasemin’s first strategy session with Darryl they discovered that their expected contribution of $1,500 per month would not be needed and they were actually in a position to purchase 3 or more high quality properties in sought after suburbs.

• Pascoe Vale new Townhouse purchased for $479,000

• The townhouse purchased came in well under their initial $600,000 budget

• Using the right ownership and loan structures created a highly tax effective investment property that started out as $32 per week cash flow positive right from day one (after rental income, depreciation and tax deductions were factored in).

• Also, by structuring the loans correctly, they were able to avoid using any savings or cash for the investment property

• With this first property being so affordable, James and Yasemin were quick to engage Darryl again and purchased their second investment property within 7 days, which was also an off the plan property

• James and Yasemin have already achieved one of their initial goals of creating wealth outside of their salaried jobs, by leveraging from the rental income and the tax office

Unexpected Benefits:

• $32 per week positive cash flow on their first purchase was a huge unexpected benefit!

• Really didn’t expect the property to increase so much in value during the construction phase

• Not having to use any cash savings to buy the new investment property was a pleasant surprise

• Finding a top quality tenant just 3 days after settlement and having them move in the same week

• Securing a brand new townhouse walking distance to the train for well under their $600,000 budget

• Being able to purchase a 2nd investment property within 7 days of buying the first one was no doubt the biggest surprise and in hindsight, the biggest win in the grand scheme of things as they now have 3 properties steadily increasing in value simultaneously

Free Download: Investors Quick Start Guide

Case Study #2:  $214,000 Equity Gain In 3 Years*

Client at a glance:

• Charles and Anna

• Married with 1 child (preschool age)

• Occupation - Sales & Marketing

• Combined Income - $98,500 pa

Property details:

• Location -  Brunswick, Melbourne, Victoria

• Property type -  2 bed 2 bath 1 garage Off The Plan Townhouse

• Purchase price $600,600

• Settlement date 30/11/14

Background:

Young couple living at home with parents wanted to get their foot on the property ladder.

They were terrified of Auctions as had seen bidding get way out of control at a few weekend auctions. This led them to the decision to purchase an off the plan property.

Objectives:

• To get onto the property ladder

• To start with a smaller property in a good location that would achieve above average capital growth to allow them to use the equity gain as a springboard into a larger property later on

Challenges:

• They were continually getting outbid at weekend auctions

• It was starting to feel like they would not be able to afford to purchase in the inner suburbs close to their work

• Being unsure of who they could trust to help them on their property journey and where to find the right team of specialists

Solution:

• Charles and Anne were introduced to Darryl Simms by a family member that knew Darryl was well placed to help them with their challenges.

• Purchased an off market, pre-release townhouse that was well within their budget, was located close to their work and had actually started construction

Outcome/results:

• $214,000 equity gain (as at December 2017) since purchase in early 2014

• Strong projected future capital growth due to supply/demand

• Off the plan savings
   

• $15,402 Stamp Duty savings as purchased off the plan

• Purchased in early stages of construction

• 10% Deposit paid at purchase and balance upon completion of new townhouse
   

• Outstanding capital growth since purchase and strong rental returns for this type of property

• Available equity has placed Charles and Anne in a great position to be able to consider purchasing another property in the near future

Unexpected benefits:

• Buying a quality townhouse that was not advertised or available on the public market (Charles and Anne did not know this method of Pre-Release property existed which allowed them to avoid Auctions and traditional real estate agencies, along with some of the less desirable sales tactics)

• Being able to afford a townhouse in a quality suburb with excellent amenities and public transport close into the CBD

• The capital growth achieved since purchase has far exceeded their expectations

Free Download: 7 Mistakes Property Investors Must Avoid

Case Study 3: $224,000 equity gain in 5 years*

Client at a glance:

• Married

• Occupation - Pastry Chef & Sales

• Combined Income $150,000 pa

Property details:

• Location -  Mt Dandenong area

• Property type - 2 bedroom free standing home on acreage

• Purchase price $462,000

• Purchased mid 2012

Background:

Both Simon and Lisa were concerned that they may never be able to get started on the property ladder

They were unable to afford to buy close in to the city but at the same time really wanted to escape the city yet still be close enough to be able to commute to the CBD easily.

Objectives:

• To invest in a property that would be easily accessible to the CBD via public transport, preferably via train

• Create some wealth through property to better position themselves for retirement

• Achieve a more enjoyable lifestyle in a location surrounded by a peaceful environment, preferably a bush setting

Challenges:

• Despite having spent years saving up a considerable amount for a deposit, the banks were not willing to include some of Simon’s income as it was derived from mostly part time roles and therefore they didn’t qualify to borrow as much as they really needed

• Finding a property that came in under their $480,000 maximum budget (imposed by the bank) proved extremely challenging

Solution:

• A good friend introduced Simon and Lisa to Darryl Simms who has extensive experience in helping individuals and couples invest in property

• With Darryl's help and several other professionals that Darryl introduced them to, Simon and Lisa were able to secure the property they were looking for in an ideal location which ticked all the boxes for them

Outcome/results:

• $224,000 equity gain (as at Dec 2017) since mid 2012 purchase

• Exciting potential for future capital growth due to the increased demand from cashed up rural retreat retirees, downsizers and holiday home buyers, largely driven by increasing number of baby boomers

Unexpected benefits:

• Property purchased ended up being on acreage with 2 separate titles, which provides the opportunity to easily sell off part of the property for financial gain.

• This property purchase allowed Simon to achieve his lifelong ambition of becoming a highly accomplished Pastry Chef

• Lisa was finally able to escape the craziness of city living and immerse herself in daily Yoga sessions in a beautiful, tranquil mountain rainforest setting.

Free Download: Property Investment Checklist

Case Study #4: $78 Per Week Positive Cash Flow

Client at a glance:

• Single with 2 children (primary school age)

• Occupation - Sales Professional

• Income $120,000 pa

Property details:

• Location - Brunswick  

• Property type -  spacious 1 bed, 1 bath, 1 car space apartment

• Purchase price $ 419,950

• Purchase date Oct 2015

• Settlement date 10th Dec 2015

Background:

A sophisticated young professional wanting to get started with property investment to gain leverage from existing considerable cash savings rather than watch her savings lose value sitting in a bank account being eroded by fees and increases in cost per living

Objectives:

• Leverage from existing savings to generate wealth for children's future education  

• To invest in apartments outside of but close to Melbourne CBD

• To purchase properties in suburbs with potential for higher than average capital growth

• Purchase in two different regions to minimise risk and create geographic spread

Challenges:

• Unsure where to buy to get maximum rental returns

• Found it difficult to identify what was a realistic purchase price on properties

• Finding apartments that were spacious and located in sought after suburbs rather than in the CBD, South Yarra or South Melbourne

• As a single mum was finding it difficult to identify property specialists that could be trusted

Solution:

• Found out about Darryl Simms from a work colleague who has been a client of Daryl's for over five years and strongly recommended him as a highly experienced property specialist and as a person of high integrity

• Darryl provided a short list of quality properties to choose from and provided excellent data to demonstrate exactly how the numbers would work as an investment

• Purchase of an off market buyer nomination property was completed within seven days of first meeting Darryl after inspecting the newly completed apartment in Brunswick and crunching the numbers

Outcome/results:

• Purchased a newly constructed apartment at 2 year ago prices

• Saved $18,537 on stamp duty due to nomination sale opportunity

• Outstanding location, short walk to trams, train station and shops

• $37,000 equity gain since purchase (including $10,000 cash rebate)

• Projected future capital growth is promising for this location

• Exceptional rental returns currently and expected to continue to rise

Unexpected benefits:

• Being able to purchase a newly completed apartment and still save $18,537 stamp duty, due to Nomination Sale (original off the plan purchaser unable to complete settlement as SMSF lenders introduced new Loan To Valuation restrictions resulting in maximum 70% LVR instead of previous 80% LVR)

• $10,000 cash rebate from developer as extra incentive to find a new buyer to take over from original purchaser (developer needed a quick sale to move onto his next project)

• Finding an apartment that was 25% bigger than most new apartments, along with a massive 24 square metre north facing balcony

• As a first time property investor the multiple professionals introduced by Darryl such as, conveyancer, rental manager, property accountant and a solicitor to prepare a new Will,  made life very easy for this busy single mum

• Finding a tenant 5 days after settlement (expected this to take several weeks)

• Ending up with a brand new investment property close to Melbourne CBD that turned out to be $78 per week cash flow positive

Free Download: Tax Benefits of Using SMSF to Invest in Property

Case Study #5: Top 10 Suburb Nets $94,000 Equity Gain

Client at a glance:

• Married with 1 child (early primary school age)

• Occupation - Small Business Owner

• Income - $260,000 pa

Property details:

• Location - Fitzroy

• Property type - Luxury Apartment

• Purchase price $465,000

• Purchase date May 2013

• Settlement date - Dec 2015

Background:

• Highly conservative self employed business owner wanting to diversify and create assets outside of existing highly successful business

• Also looking to increase tax deductions as recommended by his accountant

Objectives:

• Create assets outside of existing highly successful small business

• Legally reduce tax  

• Build a portfolio of investment properties, starting off with just one purchase initially

• Purchase more investment properties, 12 to 18 months apart

Challenges:

• Paying a significant amount of company and personal tax

• Unsure what sort of property to buy and exactly which suburbs to consider

• Have been to dozens of investment seminars over the previous 5 years and found it difficult to find a trustworthy property provider/adviser

• Biggest challenge being PROCRASTINATION - took 5 years of attending seminars to finally take action - now wishing had started much sooner

Solution:

• Met Darryl Simms at a property investment event during one of the coffee breaks and instantly felt comfortable with his level of knowledge and more importantly his down-to-earth approach and willingness to share his knowledge

• Several months later, engaged with Darryl for discussions and two strategy sessions

• Agonised over the various projects that Darryl presented, changed mind several times and eventually purchased a spacious, luxury apartment in Fitzroy, Melbourne

Outcome/results:

• Purchased an off the plan high quality, spacious, luxury apartment

• Paid 10% deposit in 2013 and balance in Dec 2015

• Saved $16,740 stamp duty as an off the plan purchase
   

• Located just metres away from quality restaurants, cafes and trams

• Secured a quality tenant a few days after settlement
   

• Equity gain of approx $94,000 based on statistics showing capital growth of 20.4%  for apartments in Fitzroy since the purchase date (source Residex)

• Projected future capital growth of 5% PA for next 8 years (source Residex)

• Excellent rental returns making the property cash flow positive

Unexpected benefits:

• The apartment becoming cash flow positive within a matter of months

• Securing a tenant a few days after settlement

• The exceptional quality of finished product - boutique and very nice

• Ease of working with Darryl

• Outstanding related services providers recommended by Darryl

• How easy it is to buy and own an investment property when you surround yourself with a team of high quality professionals

• Whole process has shifted Lucas’s thinking; now more comfortable and willing to invest and has since purchased another property

• Fitzroy (Suburb of this purchase) was listed in the Top 10 for fastest growing suburbs in Victoria @ 16.81% early in 2017

This purchase has given Lucas and Sarah the knowledge and confidence to start adding to their property portfolio and they will be looking at third purchase in near future

Free Download: Pros and Cons of Buying Off the Plan

Case Study #6: $55 Per Week Positive Cashflow Apartment  

Client at a glance:

• First Name - Emily

• Age – 52

• Occupation – I.T. Consultant

• Income – $105,000 PA

Property details:

• Location - Preston

• 7 km from Melbourne CBD

• Walking distance to trams trains and buses

• Nearby Preston market, cafes and restaurants
   

• New one bedroom 50m2 apartment with large 24m2 balcony and car space

• Purchase Price - $425,000

• Date purchased - May 2017

• Date settled - June 2017

Background:

• Looking for apartment within 15km of Melbourne CBD as investment property

Objectives:

• Create an extra income stream

• Increase asset base for upcoming retirement in next 7 years

• Looking to invest for under $450,000

• Locate a property with strong rental returns to keep ongoing contributions below $75 per week

• Wanted to buy new apartment

• Looking to save stamp duty

• Buy in a suburb with strong potential for significant capital growth

• Prefer that the property would finished in next 6 to 9 months

Challenges:

• Paying too much tax

• Felt that savings and super were insufficient for a comfortable retirement that would allow overseas travel

• Time poor due to work commitments

• Unsure what to buy and where to buy

Solution:

• Emily’s financial adviser recommended she meet up with Darryl Simms

• Darryl located a new spacious one bedroom apartment in Preston that was just 6 weeks away from being completed

Outcome/results:

• Excellent tax depreciation benefits due to the type of property and being a newly constructed property

• Secured a tenant within 7 days

• Emily liked the property so much that she is considering the option of using it for own residence in a few years time as part of downsizing plans

• Suburb has experienced excellent capital growth and looks to continue long into the future due to the close proximity to Melbourne CBD and the ripple effect

Unexpected benefits:

• The property ended up being $55 per week cash flow positive from day one

• $11,475 stamp duty savings by purchasing via nomination sale from the original off the plan purchaser

• Darryl introduced Emily to an excellent mortgage broker, property lawyer/conveyancer, depreciation schedule provider and property rental manager

• All these service providers were highly professional, delivered outstanding results, all of which made the purchase of this investment property and the whole process much easier than it would have been

Free Download: Property Investors Quick Start Guide

*Case Studies Disclaimer: 
Actual names & location of clients used in case studies may have been changed for privacy reasons.
It’s important to realise that real estate is a long term investment as values fluctuate on an ongoing basis.
Equity figures quoted in our Case Studies are based on comparable properties for sale in the same area at the time and therefore cannot be guaranteed as actual current value.
The only way to be 100% certain of a property’s current value, aside from paying a licensed property valuer, is to place the property on the market and sell it, and even then the price achieved will largely depend on buyer competition at that specific time, how emotionally attached the buyers are to securing the property and the depth of their pockets.

Any Questions?  

Request Your Free Call Back Here

Call 1300 577 233 Contact Us

Ask Darryl  for more property investor case studies/success stories and first home buyer success stories/case studies -