Meet Steve and Sarah – well they’re a little camera shy. 25 and 22 years of age respectively. With plenty of media coverage on young millennials being locked out of the property market, you might be surprised that these two are already on to their fourth property – and buying uninsured ‘as is, where is’ has helped them get there. Here’s a few things which have contributed to their success:
Steve and Sarah purchased their first home in North Beach in April 2012. The real estate market was rather subdued after the Christchurch Earthquakes. The property was sold with open EQC and insurance claims to be assigned, something a number of buyers at the time would’ve been reluctant to do. Being a builder, Steve was able to spot that the damage wasn’t major and further down the track, these claims were cash settled which helped fund further improvements to the property. Since 2012, the property’s value has increased by approximately 30%.
2. Negotiating favourable terms
Steve and Sarah’s first ‘as is, where is’ project was a run-down 1950s house in Mt Pleasant with sweeping views of the city’s coastline. They purchased it in May 2014.
“When we showed our parents the house we wanted to buy, their jaws just dropped – it far from liveable”.
When it came to auction, Steve and Sarah were the only bidders and were able to negotiate an acceptable sale price, and on terms which enabled them to carry out works to the property prior to the settlement date.
“This helped us make the property liveable prior to having to start making mortgage repayments. On settlement day, we were able to move straight in and start renting out our other property – this saved us a considerable amount of money”.
3. Know-how and hard work
There’s no doubting that Steve being a qualified builder gave them both an advantage when it comes to their project. Sarah’s eye for interior design and styling compliments Steve’s technical know-how and they help each other out where needed. Sarah’s often in charge of plastering and painting while Steve does the building work.
“When we both walk into a property, we look at completely different things. Steve can get a good handle on the work that needs to be done, whereas I look at layout and how configuration can be improved,” Sarah comments.
“While we rent out most of the properties we renovate, we still like to add our own tastes to the work we do. We wouldn’t rent out a property that we wouldn’t happily live in ourselves”.
Steve and Sarah secured their third reno project in February 2015. For three months, they along with the help of friends and family, worked tirelessly after work 5 days a week and most weekends to completely transform a tired and damaged beach bach into a contemporary family home. The property is now returning $550 per week in rent, an estimated gross return of 9% per annum.
With work well underway on their fourth purchase, this DIY power couple aren’t showing any signs of slowing down.
“We’re already keeping an eye out for the next one!”