Here’s the dilemma many investors face. Should they choose an investment property that offers Cashflow Positive returns, or one that has good prospects for Capital Growth over the next 5 years?
Great news! You can now have both and you don’t need to wait 5 years.
Correctly designed Duplexes in good locations offer the potential for Cashflow Positive returns AND immediate Capital Growth!
So how is this possible? It’s very simple really. Once construction is complete, a Duplex can be strata titled to create two separate homes. This could instantly boost the combined value of the dwellings by up to $130,000!
That’s amazing when you consider there’s no physical work involved and strata titling costs less than $10,000.
Below is an example of a well-designed Duplex on a corner lot (each home has its own street frontage and private driveway).
Duplexes provide owners with many options. Here’s a few ideas:
- Live in one home and rent the other… the tenant helps pay the mortgage for you.
- Rent both homes to maximise yields. Many investors achieve Cashflow Positive returns of around $100 per week after all costs including mortgage payments, rates, management fees and insurance.
- Rent both homes and borrow against the increased value to fund the next property investment.
- Sell one dwelling to reduce debt levels.
- Sell both dwellings to fund the kids’ university fees, a new car or your next property investment.
Although capital gains tax may be payable if selling one or both of the homes, individual taxpayers can reduce the amount of tax by 50% if the homes are held for 12 months. It’s worth noting that the 12 month period commences when the land purchase contract is signed, so by the time the Duplex is built, around 6 months will have already passed.
If investors buy through a self-managed super fund, no capital gains tax is payable if the property is sold after retirement.
Duplex prices vary depending on the location, land size and number of bedrooms and bathrooms, but in SE Queensland they typically range from just $575,000 to $750,000.
For further information about Duplexes, contact Brian White on 0418 360 490 or firstname.lastname@example.org
NOTE: Returns will vary depending on your personal circumstances. Always seek independent financial, legal and taxation advice before making any investment decision.