Property Investment Analysis Report

Property Investment Analysis Report

Introduction

When looking for an investment property, there are many different methods but the most optimal analytic approach is Discounted Cash Flow analysis (DCF). This is because traditional methods have been proven to fail, as they do not show a true reflection of value. On the other hand, comparative measures tend to disregard important components that result in the fluctuation of cash inflows. Also, by not taking the regulatory costs of investments, the comparative measures fails to display an investment’s true prospective position. The Discounted Cash Flow analysis factors in external elements such as rental growth, yields and vacancy rate. By including these factors we can evaluate the true investment potential and risk of a property. This report will cover an in depth analysis of two subject investment properties through the use of Discounted Cash Flow analysis. Subject A is located in Kogarah (South of Sydney Central Business District). Subject B, is located in Alderley (North of Brisbane Central Business District).There are three major variables in the property market that potentially affects the investment performance. These three major variables are; the Micro, Macro and Domestic environment. This report includes a market report touching base on each of the major variables. Thus, producing a more accurate projection of performance throughout the holds period. Both investment properties have a brief overview included.

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Subject A: Unit 2/14-18 Queen Victoria St, Kogarah NSW, 2217

Age (Constructed) 1977
Aspect South-East
Lot Size 65 Square meters
Bedrooms 2
Bathrooms 1
Asking Rental $495
Sale Price $633,000
NPV  
IRR  

General Comments:

Fairly old construction. Small lot size. Good level of fixtures and finishes.

Subject A is a small multi dwelling unit located in Kogarah the southern suburb of sydney and only 14 km away from the CBD.  Brick veneer construction, good quality build with 2 bedrooms inside and a  South-East Aspect.

Subject B: 3/51 Denman Street, Alderley QLD 4051

Age (Construction) 1989
Aspect East
Lot Size 66 Square Meters
Bedrooms 2
Bathrooms 1
Asking rental $360
Sale Price $360,000
NPV  
IRR  

General Comments:

Slightly new construction. Slightly bigger lot size. Good level of fixtures and finishes.

Subject B, is a multi dwelling unit based in Alderley just 7 km north-west of Brisbane CBD. Brick veneer construction, good quality build with a low asking price. Has a East aspect and 2 bedrooms. Property Investment Analysis Report

Market Analysis

Australian National Market

Australia’s economy has always been in a constant flux. Economy in Australia continued to grow over 26 years. Resources within Australia have started to become inadequate. Economy in Australia had its growth rate increased during 2017 due to the economies in asia which led to an employment spike within Australia. Thus the finance required increased along with new investment opportunities for business. Australia’s residential property prices have increased around 47% across capital cities since December 2012.

The key economic indicators in Australia such as the estimated resident population (ERP) from 31st of March 2018 had estimated 24,899,100 people. Compared to 31st of December 2017 showing a population increase of 125,100 people and when compared to 31st of March 2017 it showed a population increase of 380,700 people.

The Australian economy growth has increased as GDP per capita increased by….Show More….

 

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