When prospective clients ask me to help them find a metro asset which can produce a gross rental return of 5% or better, I usually brace myself for a tough assignment. The reason for this is that in most circumstances, finding returns like this usually spell compromise, and I don’t like compromising much when it comes to asset selection. Some compromises include company share titles, student accommodation or brand new properties; all of which I avoid no matter what.
But on this occasion, I explained to my lovely new clients that their 5% would be very tough to meet and they reconsidered and agreed to target 4.5% or stronger. Ordinarily a 5% return for an uncompromised property would usually mean that I’d have to target a regional property; whether it be Geelong, Bendigo or Ballarat. My clients were certain that they wanted aggressive, inner-ring-suburb-style capital growth, so we focused on suburbs like Kingsville, Footscray,West Footscray and Maribyrnong. The best surprise however was when a local agent from Kensington called to share this listing with us… a superbly refurbished, two bedroom apartment in a boutique block featuring a balcony, good sized rooms and a shared laundry right next door.
- The facade of 95 Eastwood St Kensington (REA)
The balcony was a bonus for the price – with a budget of $375,000 we knew we were challenging ourselves (and the agents) to find a property which offered so many ‘nice-to-haves’.The separate toilet, built in robes, renovated kitchen and bathroom and leafy outlook gave us all a sense of excitement with the mere thought that we’d come close to nailing the original brief.
- The renovated kitchen and bathroom help boost the rental prospects and the overrall tenant demand for the property. (REA)
The best part about this property, however is the location. The local cafes, train station, Hardiman Hotel, restaurants and shops are all within a three minute walk from this block.
Home to young professionals and families in Victorian cottages, life in this cosmopolitan village is sought-after by many.
Kensington is just two train stations to the city and with two stations to choose from (Macaulay and Kensington), commuters are spoilt for choice.The only challenge I faced with this particular apartment was coordinating my inspection on Derby Day.Our happy buyers can look forward to a rental return of $370pw; a return which even eclipses their initial target of 5%.“The streets were at a standstill while racegoers walked to the track.”
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