There are a wealth of ways to make money off investment property – after all, it is an investment! From capital gains to rental income and everything in between, it’s important to understand how you can make a return on your investment.
We explore the key methods used to gain ROI and showcase some of the results ALC has been able to deliver for our clients.
What is ROI?
ROI, or Return on Investment, is a calculation used to measure the financial gain or profit made on investment as a percentage.
How is ROI calculated?
ROI is usually calculated by subtracting the initial value of the investment from the final value of the investment, then dividing by the cost of the investment.
For example, say a property cost $500,000 (initial value). 10 years later, it was sold for $800,000 (final value). The calculation would then be:
$800,000 (final val) – $500,000 (initial val) = $300,000
$300,000 / $500,000 = 0.6 or 60% ROI.
Increasing ROI on your property
There are several ways to make a positive return on your property investment. A lot of investors will rely on rental yield, which is the profit made from rental income, while others may focus on capital gains or appreciation. Whichever method you choose, you must ensure you carry out the right research to ensure your investment is going to deliver increased ROI.
How ALC has achieved positive ROI for real clients
As investment property experts, ALC always keeps a finger on the pulse of the housing market. Through our extensive research, we’ve been able to secure house and land packages in areas that have experienced notable growth rates. Most of the locations we recommended to our business network have grown more than 10%, with others achieving growth of up to 40%.
How $440,000 invested in residential property, have made up to $200,000 in capital gains
For any of our partners who placed clients into an ALC home and land package in Melbourne’s Wyndham Vale or Doreen areas, their clients will be experiencing significant capital gains. Below we explore some of these real examples.
Our results:
Doreen, Victoria
Property Specifics:
- 3 Beds
- 2 Bath
- 1 Car
- 212m²
- Purchase price: $340,000
- Recent sale price (Dec ’21): $545,000
- Capital appreciation: $205,000
Wyndham Vale, Victoria
Property Specifics:
- 4 Beds
- 2 Bath
- 2 Car
- 400m²
- Purchase price: $440,000
- Recent sale price (Dec ’21): $640,000
- Capital appreciation: $200,000
With results like these, now is the time to talk to us about your clients needs and ensure you can secure only the best home and land packages. Chat to one of our team today, or fill out our order form here to be sent a portfolio of properties that match your clients needs.
We’d love to connect
Always speak to your qualified financial advisor for tailored advice for you.
