The perfect investment for time poor investors

by Amy Mylius

One of the best things about an ‘off market’ property is that it hasn’t had the exposure of online advertising and a five week auction campaign with dozens of buyers walking through the door. One of the worst things about this type of property is that the vendor hasn’t committed to any marketing expenses or a certain ‘sale date’, so there’s always a risk that they change their mind or shift the goal posts.

Last week two an off market opportunity arose for two young ‘rentvestor’ clients who had chosen to invest in a growth asset on a full block in the northern gentrifying pockets of Melbourne while continuing to rent in gorgeous Elwood. We were incredibly lucky to find a property in our first week of inspections which ticked every box; 12 kilometers from the CBD in a leafy street of Glenroy (one street away from the Oak Park border), 3 bedrooms, almost 700sqm, north facing yard and walking distance to the shops and station. What drew the clients to this property was how well the vendors had kept the house – it was clearly very well loved and well cared for during the 25 years the vendors had owned it.

There are critical things we look for when finding a house which is unrenovated, but still suitable for a time poor investor.

The first is the floorplan – our goal is to avoid moving any walls or additional rooms such as sunrooms/external laundry. When we talk about cosmetic updates, we generally mean renovations which won’t require the assistance of a builder. This Glenroy property fulfilled this criteria perfectly – three generous bedrooms, a living space which flowed into the dining room and then opened out to the entertaining area, and a kitchen which overlooked the huge north facing yard.

The second element we look for is the general state of the house.  Does it need restumping? What condition are the weatherboards in? Do the fences need straightening? Is the roof in good condition? Do the gutters need replacing? Is the timber in the windows rotting? How much immediate or short term maintenance is required? Will the likely cost of the issues will impact our clients cashflows and savings, and potentially reduce the amount they can stretch to buy the property? …or even prevent them from purchasing it at all?

Our property in this instance had barely any problems that the builder could identify. In his words – “this is a phenomenal property. Concrete stumps, everything in excellent condition. I’m finding it hard to fault!”

The third element relates to the kitchen and bathroom. After renovating my own property and learning how expensive it is to move pipes and wiring, I’m always looking at how simple it would be to update a kitchen or bathroom using the existing plumbing and electricals. This also means less reliance on plumbers and electricians – therefore a cheaper and more manageable renovation with less downtime and vacancy.

This property fit the bill perfectly.

Our clients will be fortunate enough to settle and chose to do no work at all, or exercise the option of project managing a simple cosmetic update which will ultimately produce a spectacular result.