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Multiple property purchasers (Portfolio Builders)

The Scenario

Two brothers that knew they wanted to add to their property portfolio, but wanted step by step guidance throughout the process.

How They Came to Vision

Steve and Oliver Dimoski are affectionately known by the Vision team as the Dimoski Brothers.  They have been valued clients of Vision for over 10 years.

They both owned apartments in inner city Sydney. With Sydney’s growth they had built up equity and put themselves in a good position to invest, but they were not sure if Sydney was still the best option for them.

They approached us to help them with what to do next.

The main goals

After several face to face meetings, phone conversations and completion of a full Finance Fact Find, we were able to get a firm understanding of their medium-long term aims:

To create a passive income from property investment to replace current salary income to support them during their retirement years.

To achieve a net income of $2,000 per week within 20 years (being 2035).

Buy up to 6 properties over time to achieve their income objectives.

How Vision helped

The Fact Find enabled Vision to:

Conduct a full assessment of their purchasing/borrowing capacity

Make further enquiries which helped the Brothers fine tune their goals

Financially modelled their circumstances to see how they could achieve their desired outcome.

We then discussed what property types they felt most comfortable with and agreed to move forward to search for appropriate properties for their portfolios.   Then we gathered all the supporting information to confirm their borrowing capacity and proceeded to get the lenders approval.

Then knowing what the clients required and what they could afford, Vision conducted a rigorous macro and micro analysis of the Australian property market.  Which city? Which part of the city? What type of property?

What was done?

The Dimoski Brothers are a good, balanced pair in terms of borrowing capacity as one brother is stronger in equity, while the other is stronger on income.

This led to Vision and the Brothers being suited to a number of property types, giving Vision the opportunity to mix it up to achieve the same balance required to continue borrowing for portfolio growth.

 

First up was a duplex. Why?

They provide a great combination of strong yields whist providing the added potential benefit short term uplift in value due to the one property becoming two.

 

Second property was a Dual Occupancy property. Why?

They provide amazing yields that generate positive cash flow from day one. Going forward these are properties that deliver the rental returns required to meet the Dimoski passive income objectives with less capital / money invested.  Dual Occupancy Homes achieve this from receiving two lots of rent from a standard building block.

 

Third property was a well-positioned luxury inner city apartment in Brisbane.  Why?

Capital growth with reasonable yields. The apartment specifically targets the downsizing cashed up baby boomer with a developer that has consistently outperformed the market on returns for investors.

Where to now?

The Dimoski are well on their way to achieving their long term goals

Their new properties have rented out within a week of completion, with all rents above initial projections. And with recent independent property valuations, the Brothers portfolio is already showing a % increase in their equity position.

The strategy put in place means that the next two properties will be purchased in a few years to fully benefit from the increase in equity from their portfolio which limits the funds they are required to put in themselves for their next purchases.

In the meantime Vision and the Dimoski Brothers will continue to remain in close contact and work together as Portfolio Builders, to ensure they achieve their financial aims.

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