You may have read the recent article in Daily Mail Australia outlining how a property investor who bought his first two-bedroom unit at the age of 18 after saving for the deposit on a $26,000-per-year McDonald’s salary has purchased an additional 12 homes in just six months.

Eddie Dilleen, from Mt Druitt in western Sydney, has an impressive portfolio consisting of 52 investment properties estimated at $25 million dollars.

How did he do it? Mr Dilleen told FEMAIL there are three key features he looks for in a property.

These are:

1. High yield (income return)

Rental yield is the annual income generated from rent as a percentage of the property’s value. Quite simply, the higher rental yield, the better cash flow is. And having a high yield means you can borrow money.

The amount of rent you can charge, ie income, is determined by factors such as location, type and condition of the property, and also the supply and demand in the market.

At the moment, we’re experiencing a high demand for rental properties, and it’s worth noting, a less expensive property in the next suburb along, may give you a higher rental yield than a more expensive property located in a more desirable location.

To find out more about yield, read our blog on ‘Yield explained’ here.

2. Capital growth

This is the increase in property value over a period of time. While the market does move in cycles, and there are times when property prices rise considerably quickly and there are times when prices don’t appear to move at all and even decrease, but generally the longer you own a property, the greater the capital growth.

A Core Logic report recently revealed that over the past 30 years, property values have increased nationally by 382%; in annual compounding terms, that’s a 5.4% rise per year on average since July 1992. Find out how the Newcastle region fared in this report here.

It’s worth remembering too, when you’re calculating the actual capital gain on your property, you will also need to factor in, you will need to factor in selling costs and any tax due.

3. Ensuring the price is below market value

This isn’t always easy to do, as every seller wants the best price! But there are occasions where a seller opts for a lower price for a quick sale, for instance they maybe moving for a job opportunity.

Furthermore, we are potentially heading towards a buyers’ market; spring is traditionally the time when vendors put their house on the market, meaning there are more properties for sale. Add to this the interest rate rises may mean there are less buyers able to get finance, so properties will need to be competitively priced in order to be sold in a reasonable amount of time.

Buyers may also consider purchasing a property in need of renovating, with the view the renovations will add value. Check out our blog on points to consider when buying an investment property needing renovations

While inflation continues to rise, Mr Dilleen, now 31 believes it’s still possible for first home buyers to get into the market with the right mindset and strategy.  Indeed, he believes anyone can invest in property, ‘but you need to consider your goals and think long-term,’ he said.

Read the full article about Mr Dilleen’s property investment strategy and tips here.

Mr Dilleen is a very canny property investor, and is probably prepared to take more risks than many. However, we do agree with him in that anyone can invest in property; our advice is do your sums, be realistic about your finances, and speak to a financial expert who can advise you about your individual financial situation.

You may well find you can, not only get your foot on the property investment ladder, but you can start to climb up it too!

Get in touch and see how our property management services can make your life easier and free you up to do more of the things you want to do.

Simply give us a ring on 02 4956 9777, send us an email to mail@newcastlepropertymanagement.com.au or pop into our Cardiff office for a chat.

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