- Cowaramup is a small thriving town in the South West of WA, on the outskirts of Margaret River.
- This property was on the market for ~18 months at $600,000 without much interest.
- It was purchased in July 2018 for $420,000 subject to a new 7 year lease at $49,000 (11.6% yield).
- With an initial loan of 70% the free cashflow was ~ $35,000 p.a.
- The property was sold in July 2022 for $620,000.
- This purchase delivered ~ $140k in income and ~$180k in capital growth over the 4 year hold period, or an IRR of ~ 40%.
Acquisition Details
Purchase Details
Purchase Price
$420,000
Net Rent
$49,000
Net Yield
11.7%
Financing
Borrowing
70%
$294,000
Deposit
30%
$126,000
Acquisition Costs
5%
$21,000
Total Funds Required
$147,000
Free Cash Flow
Net Rent
$49,000
Interest Expense
4.7%
$13,818
Free Cash Flow
$35,182
Return on Cash Invested
23.9%
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