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AUSTRALIA THE LUCKY COUNTRY

AUSTRALIA THE LUCKY COUNTRY. WE RODE ON THE SHEEPS BACK THIS TIME IT IS THE RESOURCES BOOM. Moranbah – Why?. Moranbah sits in the heart of the mines. A perfect base for miners to live and be sent to any mine. Moranbah – Why?.

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AUSTRALIA THE LUCKY COUNTRY

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  1. AUSTRALIA THE LUCKY COUNTRY WE RODE ON THE SHEEPS BACK THIS TIME IT IS THE RESOURCES BOOM

  2. Moranbah – Why? Moranbah sits in the heart of the mines. A perfect base for miners to live and be sent to any mine.

  3. Moranbah – Why? • Developments within the town on Res A land, which typically only have a single house on it, are able to be removed without restriction and Multi Unit Dwellings (Units/Townhouses) will be approved under a Development Application (MCU – Material Change of Use) • The town is landlocked due to the surrounding land being mines owned by mining companies (mainly BHP). • What do we mean by landlocked?

  4. Moranbah

  5. Moranbah – Why?

  6. Our Property

  7. Our Property

  8. Our property • Purchase price $668,000 • Rent per week $2,200 • Return of 17%

  9. Our planned development • Build two townhouses on our free land • Build costs $300,000 ea, inc fees = $600,000 • Sell townhouses $650,000 each = $1,300,000 • Profit $700,000 less fees $600,000 (roughly) • Pays off loan on old house, income stream

  10. We then got offered next door

  11. Second Property • Purchase price $508,000 • Expected rent per week $1,600 • Return of 16%

  12. The Development Changes • Then realised we can build ten townhouses • Build $3,000,000 + $1,176,000 = $4,176,000 • Sell all @ $650,000 = $6,500,000 • Projected profit over = $2,000,000 • You bloody beauty

  13. That’s the positives • What about the negatives?

  14. Sewer Lines

  15. Negatives • BMA workers have been on strike, so no new workers were employed for a while • ULDA releases land for affordable housing • This created an over supply of houses to purchase and for rent coming onto the market • Taking too long to develop. You may miss the window of opportunity to get in and out with a healthy profit

  16. 12 Months on • First house rents for $1,600 per week (2,200) • Return now of 12% (17%) • Second house rents for $700 per week (1,600) • Return now of 7% (16%) • We had to adapt to the market

  17. The Development Changes Again • Keep first house and build 5 townhouses, 1 at the back and 4 on second block @ $300K each • Build costs + Other Props Total $1,500,000 + $1,176,000 = $2,676,000 • Sell 5 @ $650,000 = $3,250,000 • Estimated profit $600,000 less fees, plus we • Still have old house paid off for income stream

  18. What if they only fetched $550,000 • Build costs $300K + Old Props = Total $1,500,000 + $1,176,000 = $2,676,000 • Sell 5 @ $550,000 each = $2,750,000 • Estimated profit $74,000 less fees plus we • Still have old house paid off for income stream

  19. Lessons Learnt - Many • Minning town properties can move very quickly up or down, purchase and rentals • Get in and out and take a profit asap • Keep an eye on what the mines are up to • Research, research, research • Developing is a roller coast of emotions • Watch out for the “Pitfalls”

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