Looking at 2 different investments similarly priced IP1 prob $50k more, in areas with average annual growth in the 7.5 - 8% range. IP 1 is a 3 bedroom brick home split into 3 x 1 bedroom units all need work with potential to add $100k value and rental return upto $300-320 week per unit. Current $220/each. Needs more work than IP2 IP 2 is a 3 x bedroom clad home with the potential to add $150k-$200k based on other sales in the area. More upto $300k if l wanted to do an extension and make it a 4 bed 2bath. Thoughts would be great
Also depends how much you would have to spend on the renovations in order to create the value growth. For every dollar you spend on the reno you would of course expect more than a dollar in value growth. How much more you get in value growth depends on the area.
Re IP 1 - is the house divided into 3 units council approved? Does it have fire rating for each of the units?
What's the end goal/what are you trying to achieve? ie. buy and hold, add value and sell, add value and keep etc.
^ ^ this is a major concern for IP1 despite the fact it is in East Mayfield with excellent CG historically. If you can no longer rent as 3 but only 1 then it could seriously affect your ability to hold.
Just starting out, add value and keep as I see that as the quickest way to build a portfolio hoping to grow portfolio quickly (5-7years). Have since asked council and they have said IP1 is highly illegal and will be looking into it so will not be pursuing it any further.
