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  • "Milk your cash cow here"

    You see an advertisement for a property for sale. No price listed.

    You find it on Trade Me under the search criteria $0 to $250k

    The property is in Northcote, Christchurch.

    Price by negotiation.

    Rental return is set at $330 per week on a fixed term ending 13 months following the advertisement (advertised in 2012).

    What would be your offer?

    Why would you offer that amount?
    www.3888444.co.nz
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  • #2
    Originally posted by Keys View Post
    You find it on Trade Me under the search criteria $0 to $250k
    I wouldn't hang my hat on the vendors expectations are actually under $250k
    http://decisions.dotnous.com/reaa/pdfs/CA3643635_Determination.pdf

    http://properazzi.co.nz/opinion/prop...-more-accurate
    Last edited by speights boy; 12-08-2014, 08:33 PM.

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    • #3
      What would you offer and why?

      Considering the heading "milk your cash cow here".
      www.3888444.co.nz
      Facebook Page

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      • #4
        It's been advertised since 2012??

        I would find out the address first then ask myself 3 questions:
        1) Why has no one bought this?
        2) Why has no one bought this?
        3) Why has no one bought this?

        Then proceed not to waste my time and find something else =D

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        • #5
          Sounds like it's suffered a wee bit from the earthquakes.....just because it's rented doesn't mean it's sound

          Might be worth checking....nothing ventured etc

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          • #6
            The property has been sold. It was in good condition.

            My question was not obviously put well enough.

            If it was advertised as a property that you could "milk your cash cow here" Those words are important ......................

            What return would you expect to get from the property and how would you calculate this return?
            www.3888444.co.nz
            Facebook Page

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            • #7
              you would expect to get a very good return - 10%+ - way better than average.
              Calculate the offer based on expected rent.
              Assumes rates etc normal (not a lease hold etc).

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              • #8
                9% return, then work backwards to get the price.

                If it's a decent area, maybe lower return.

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                • #9
                  Originally posted by Gary Lin View Post
                  9% return, then work backwards to get the price.

                  If it's a decent area, maybe lower return.
                  Keys point, I think, is around the 'cash cow'.
                  Do you think 9% or maybe lower is a 'cash cow'?

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                  • #10
                    Originally posted by Keys View Post
                    The property has been sold. It was in good condition.

                    My question was not obviously put well enough.

                    If it was advertised as a property that you could "milk your cash cow here" Those words are important ......................

                    What return would you expect to get from the property and how would you calculate this return?
                    We see.....and the answer to this is quite obvious

                    Cash cows generate a yield about equal to the lowest going mortgage rate....about 6% I think

                    Well at least that's my experience of how real estate agents think

                    With this in mind the property obviously sold for around 290K.......(330*52) / 0.06................and note properties are always rented for each and every week of the year

                    Or perhaps it sold for even more.....this depending on how ignorant/gullible the buyer was (and how good a salesman the agent was)

                    Now how much would "we" offer?

                    Something with a yield of about 10% ..... around 165K...based on 50weeks rent

                    Now that's a cash cow LOL
                    Last edited by Ahar; 13-08-2014, 04:31 PM.

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                    • #11
                      Originally posted by Wayne View Post
                      Keys point, I think, is around the 'cash cow'.
                      Do you think 9% or maybe lower is a 'cash cow'?
                      It depends which city and which part of the city.

                      7% in Central Auckland (apart from apartments and leasehold crap) would be considered cash cow.......

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                      • #12
                        He said it was Northcote, Christchurch

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                        • #13
                          Originally posted by speights boy View Post
                          He said it was Northcote, Christchurch
                          I know that, but I don't know Christchurch.

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                          • #14
                            So why the 9 % figure ?

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                            • #15
                              Originally posted by Gary Lin View Post
                              It depends which city and which part of the city.

                              7% in Central Auckland (apart from apartments and leasehold crap) would be considered cash cow.......
                              Jez Gary - did you not read this at all (or are you just trying to argue)
                              The property is in Northcote, Christchurch.
                              Not everything is about Auckland Gary - take off the shutters!

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