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  1. #1
    Join Date
    Aug 2009
    Location
    Mainland
    Posts
    1

    Default Buying a Show Home - what should I look out for?

    I've got the opportunity to purchase a showhome, and would appreciate any advice about what any potential pitfalls might be. Ideally it'll be a showhome for a couple of years* The pros look good, just not sure about the cons. I'm a newbie, own my own home, but thats it at this stage.

    *If anyone has a copy of a Show Home Lease Agreement that woudl be awesome.

    Thanks in advance!

    Hame

  2. #2
    Join Date
    May 2007
    Location
    Hamilton
    Posts
    3,498

    Default

    Hi Hamel,

    What is the gross yield?
    What is the overall cashflow with 100% mortgage? What is overall cashflow for you?

    My guess is the rental return/cashflow is terrible. So this brings the question of why do you want to buy it?

    Ross
    More Profit from Property? TEACH ME MORE
    Ross Barnett - Coombe Smith Property Accountants
    Proud to give the best property advice for over 13 years.

  3. #3

    Default

    Show homes tend to be tricked out so are expensive relative to the expected rental return.
    Free online Property Investment Course from iFindProperty, a residential investment property agency.

  4. #4
    Join Date
    Sep 2007
    Location
    Auckland
    Posts
    8,065

    Default

    Quote Originally Posted by Rosco View Post
    Hi Hamel,

    What is the gross yield?
    What is the overall cashflow with 100% mortgage? What is overall cashflow for you?

    My guess is the rental return/cashflow is terrible. So this brings the question of why do you want to buy it?

    Ross
    This hasn't stopped anyone buying for the last 8 years. It's all been based around capital gains. And the 'investors' have all been proven correct up until recently. I that virtually everything has doubled in value in that time.

    So they're still trying to do that.
    Squadly dinky do!

  5. #5
    Join Date
    May 2007
    Location
    Hamilton
    Posts
    3,498

    Default

    Quote Originally Posted by Davo36 View Post
    This hasn't stopped anyone buying for the last 8 years. It's all been based around capital gains. And the 'investors' have all been proven correct up until recently. I that virtually everything has doubled in value in that time.

    So they're still trying to do that.
    Agree - and the past few years shows it has worked.

    But if you can buy something smart, add value through subdividing for example, get the cashflow even. Then isn't that better and lower risk? If properties jump in value, still benefit! But just not having to prop up the property every week!

    Ross
    More Profit from Property? TEACH ME MORE
    Ross Barnett - Coombe Smith Property Accountants
    Proud to give the best property advice for over 13 years.

  6. #6
    Join Date
    May 2007
    Location
    Hamilton
    Posts
    3,498

    Default

    I like this video, which shows what also happens to a lot of new investors - https://www.facebook.com/theproperty...9594571973849/

    Ross
    More Profit from Property? TEACH ME MORE
    Ross Barnett - Coombe Smith Property Accountants
    Proud to give the best property advice for over 13 years.


 

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