We help people secure and create positive cashflow properties in Canberra generating 5% - 7% gross returns
What do we do for our clients?
We help residential property investors secure and create high or positive cashflow residential properties in Canberra, ACT (Australian Capital Territory).
We do this by finding great/below value, established residential properties suited to having a Secondary Dwelling and extension added to the block.
We represent clients in negotiating and purchasing great/below-value established property.
Partnering with Fixed Price Extensions and Canberra Granny Flat Builders, we then manage the planning and development approval for the additional Second Dwelling and deliver the building using a fixed price quality guarantee.
Once we have built the Second Dwelling, the dual-income property should generate a yearly gross return of 5%–7% based on the initial total investment.
Directly below is a selection of pre-qualified properties that demonstrate significant value and are suited towards adding a Secondary Dwelling.
Qualified Canberra Cashflow Properties For Sale
With Potential 5% - 7% Gross Annual Returns.
Qualified Canberra Cashflow Properties For Sale
With Potential 5% - 7% Gross Annual Returns.
|Date||Address||Recommend Buy Price||Median Suburb House Price||Estimated Gross Rent PW||Medium Suburb House Rent||Planning Report||Recommended Build Design||Likely Build Cost (including GST)||Second Dwelling Rent||Combined Rent PW||Stamp Duty Plus|
|Total Investment||Gross Combined Rent PA||Investment Gross Return||Get Help Securing This Deal|
Established Dual Income Properties For Sale In Canberra
Why do we do this for our clients?
We have an insight into some of the remarkable financial returns our clients have and continue to achieve by building additional housing on existing blocks to create dual-income property investments.
There are well-documented differing strategies when it comes to property investing. We aim to assist customers focusing on higher cash returns in stable and consistent property markets (Canberra) who have an aversion to multi-unit housing and body corporates.
We are your ideal partner if you believe in the merits of high cash flow returns from residential property investing as a wealth creation and asset accumulation strategy.
If you understand and believe in the resilience and strength of the Canberra economy and the benefits of investing in Canberra - then we can help you.
We recommend Canberra because it consistently has the lowest residential vacancy rates and the highest average weekly house rents across capital cities nationally - read here.
Canberra is also consistent in that over a decade (2010-2020), nearly all established Canberra suburbs had comparable capital growth on percentage terms, proving its citywide stability
Often accused of being bland and boring, the ACT has the highest median income of all Australian States and Territories.
There is an ongoing housing crisis; the rental housing crisis is very well documented. As we write this (December 2022) Canberra has an average weekly rent of $778.77 for houses across the city.
While population growth is set to soar over the next decade, real investment in community and social housing is scarce, putting increased pressure on the private rental market, explaining the 1-2% citywide residential vacancy rate.
Overly bureaucratic local planning and development legislation, including development taxes, has stifled suburban infill over the past decade.
The local government has focused on multi-unit development along the light rail corridor. This pre-occupation has resulted in an acute shortage of single-level houses built in established Canberra suburbs. This is why the demand for Secondary Residences, commonly known as Granny Flats, is so high in Canberra.
In short, this is what we recommend based on the financial success of past clients.
- Investing in the regions of Tuggeranong, Belconnen and or Weston Creek
- Feeling comfortable in buying ex-government-built homes predominately built in the 1960s and 1970s
- Focusing on properties with a per SQM rate of about $1000-$1100
- Blocks that are generally greater than 600sqm in si
- The investment level is around $700k-$800k (three-bed ensuites are great at $880k). Building a 1-4 bedroom Secondary Residence on the same block - front or rear zone - designs here
- Buyers focusing on even higher cash returns can consider an AirBnb stratgety similar to this 3 bedroom 2 bathroom design
- Potentially investing between $25,000 -$50,000 to uplift the existing home, making it more energy efficient and providing solar and non-gas heating and cooling - In-House Renovations can do this.
- Implementing upfront tenancy agreements that enable the construction of the Secondary Residence while the primary tenants remain in place during the build
- Building 2 homes on one title will result in no changes to the land taxes or rates so focusing on RZ1 zones is better
- Focusing on high turnover and out-of-area agents and attending as many auctions and showings as possible
- Building the Secondary Dwelling within the first 12 months so you can mximise the cash flow
- Generate a return of between 5%-7% per annum after completion of the Second Dwelling
Level blocks with minimal improvements, uncomplicated easements and direct utility connections are generally preferred. Protected trees and the availability of compliant parking are also factors, however less significant.
What does this service cost, how do we get started, and why should we engage Buyers Agent Canberra?
There is no upfront engagement fee, just a commitment to work exclusively together.
Each week we post 1,2 properties that we research and recommend.
However, often the hidden value is talking to the agents direct and attending auctions and being in a position to bid, sometimes as the sole bidder, as we see many properties pass in.
So once we have exchanged contracts on the target property, you get to pick the applciable success fee between a range of 1.5% and 2.5% inclusive of GST.
What's included in the 1.5%-2.5% service fee?
- We will negotiate and or bid at auction, saving you, on average, 3.5% of the properties' expected or asking value.
- We may need to attend upwards of 10 auctions on your behalf to secure the best deal, and we have three dedicated and experienced bidding agents in Canberra.
- If the sale is off-market, then the standard fee range remains, which you get to select, and we most definitely do not receive a fee from the listing agent.
- We will remove the stress and time involved in shortlisting and selecting the best-suited properties for this high cashflow strategy.
- We can save tens of thousands of dollars by using our expertise by reviewing building and compliance reports pre-negotiation or bidding (you may need to request from the agent to maintain ).
- We will also undertake the Planning and Development evaluations before purchase to determine potential hidden costs and complications and the most suited blocks to develop.
- Target flat fee, out of area and high-volume agents to obtain the best value deals.
- If you require assistance in finding an experienced lawyer, accountant or finance broker we can provide you a shortlist
If you decide to advance with the building of a Secondary Dwelling (which we hope you do) and an extension, then we will engage our design team at Canberra Granny Flat Builders and Fixed Price Extensions.
As soon as we have finalized the design, we will provide you with a Fixed Price Quality Building Agreement, which includes a total and fixed price.
If you are happy with the proposal, we will advance to the planning approvals stage.
On average, planning approvals to build a Secondary Residence take six months to obtain in the ACT.
Rest assured, and we can add a condition in the lease agreement that will enable us to lodge the development application and build. At the same time, the tenant remains in the primary residence to pay rent.
But why Frank Walmsley and Buyers Agent Canberra?
Over the last 5 years Frank has called close to 1000 Canberra and surrounding auctions, for 25+ agents and agencies Read Franks reviews here.
When he is not calling auctions on the weekends, he is helping clients understand what they can do with their blocks of the earth in Canberra, having delivered over 2000 Planning Assessment Reports in the last decade.
In the media:
- Canberra's best auctioneers - Riotact
- Desperate home buyers enlist professional bidders to attend 'pressure-cooker' auctions -Domain
- Madness stuns agents and house hunters -zango.com.au
- Bidder moves against himself to secure property - The Canberra Times
- Record price for land in Deman Prospect - The Canberra Times
Even in falling markets, it takes experience to know what to do in the different circumstances that present themselves at auction.
Andrew Morris and Frank Walmsley can represent you at auction or in direct negotiations to secure the best value properties using their combined 30-plus years of experience.
What's the next step and to find out more?
Let's have a 15-minute zoom meeting to answer your questions. Happy for your accountant or financial advisor to join. Complete the contact form below.
Frequently Asked Questions
The ACT is unique in that it has a leasehold land title system. In theory, you are renting the land from the Federal Government with a 99-year lease with the certainty of renewal.
For tax purposes, as you are not acquiring the land, you can claim 100% of the stamp duty as a tax deduction (for investment properties) for properties purchased in the ACT within the financial year it was purchased.
No is the short answer.
Rates in the ACT are determined by the property's unimproved value (UV), which means the land's value, not the improvements/structures upon it, determines the calculation of the rates
Land tax in the ACT is only applicable for investment properties.
If you have two dwellings on one title and live in one dwelling and rent out the other, then only the residence rented out attracts land tax. In this instance, the land tax is paid proportionally on the net lettable area rented. There are some subtle loopholes to this as well, which I can explain when we meet.
Yes, 100%. It was well documented in the best-seller Freakonomics.
Watch here: https://www.youtube.com/watch?v=aFYlgqv3T-w
Agents are generally motivated by the financial incentives negotiated with the seller.
Agents working for flat fees like $10,000 or 2% of the sale price have minimal incentive to hold out for a premium price on behalf of their seller clients.
What generally motivates them is the speed and uncomplicated nature of the sale and the ability to turn over the deal as quickly as possible so they can move on to the next sale.
Most sellers list with the agent they like the most or know, or who is cheapest (often flat fee) rather than those most likely to negotiate an incentive outcome or versed in the art of negotiation. I mean, even the seller out-negotiates the appointed negotiator (agent).
We can use this to our advantage; we have developed a list of the 20 most favourable agents to buy from. The savings can be up to 15% of the market value.
We cannot legally publish this list of the most favourable agents to buy from, but here are some of the factors that get those agents onto the list:
agents selling properties from their rent roll - interstate owners with limited knowledge of the value highly influenced by the agent
agents selling out of the area
agents with lots of stock - looking for high and quick turnover
agents with a high auction clearance rate, 95%; this means a higher likelihood of convincing the owner to take an offer on the day of the auction
agents with a preference to sell pre-auction
agents looking to retain properties in their rent roll, preferring investors over owner occupiers
agents selling complicated properties with factors like class 10 structures or unapproved dwelling elements
All these factors can be used to your advantage. Having the ability to exchange and settle quickly can also create bargaining strength.
The percentage of private sales is minimal in the ACT 1% of transactions. On occasion, this can be very fruitful.
There is limited sales evidence of homes with Secondary Dwellings selling in Canberra; however, the sales evidence that we do have demonstrates a significant return on capital for those that build
The Planning and Development Act changed in 2017, allowing for Secondary Dwellings to be built on blocks greater than 500sqm (about the area of a basketball court) in the ACT.
Since 2017, only about 80 (Secondary Dwellings) per year have been built. Not because of the absence of market demand but primarily because of the perceived complexity of dealing with the ACT Planning bureaucracy.
From our research, only a handful of properties with two residences had sold post-2017 when the laws were introduced. Most properties purporting to be dual residence homes are makeshift properties with Class 10 structures illegally rented as Granny Flats.
As an auctioneer, I have sold two properties with two dwellings on one title in the last 12 months, and both have sold well above expectations.
In Kambah, with a UV of $395,000, a three-bedroom Secondary Dwelling and a modest four-bedroom home sold for $1,525,000 in late May 2022. Video: https://youtu.be/oKW6vsITDYc
In October 2021, we sold a basic 98sqm three-bedroom home and a three-bedroom Secondary Dwelling (design 384) for $1,080,000. Video: https://www.allhomes.com.au/20-montefiore-crescent-conder-act-2906.
Most property websites have published rates and land tax values of the specific property being offered for sale.
However, as rates and land taxes are calculated on the Average Unimproved Value of the property, there is a straightforward online calculator tool:
This tool also calculates applicable land tax rates based on foreign ownership %.
Yes, is the short answer. However, you will need to have tenancy agreements in place. Residential Tenancy agreements are legislated in the ACT and are governed by the Residential Tenancies Act 1997. This means that the 100 conditions outlined with the residential tenancy terms can't be negotiated or changed because they are regulated.
To enable two separate tenancy agreements, 1 per dwelling, you will need to have individual utilities, specifically electrical. This means both houses need separate electrical meters, and individual water metering is not required for a unique lease arrangement.
Download ACT residential lease agreements: https://www.revenue.act.gov.au/__data/assets/pdf_file/0015/1502502/Standard-residential-tenancy-terms-Commencing-25-August-2020.pdf
A complimentary BMT Tax Depreciation schedule will be provided if you build a Secondary Dwelling with Canberra Granny Flat Builders or an extension or improvements with Fixed Price Extensions.
Please find an example BMT Depreciation schedule that incorporates CGFB designs 160 and Design 390. Download
The report calculates the values of Division 40 and 43 deductions for the client/property owner.
Division 40, also known as plant and equipment, are the removable assets within an investment property.
Division 43, these are:
- buildings or extensions, alterations or improvements to a building
- structural improvements such as sealed driveways, fences and retaining walls
- earthworks for environmental protection, such as embankments.
Claiming the tax deductions has a significant financial benefit to the property owner. This is why having a property that combines 2 dwellings with new and old buildings - low deductible (older), and high deductibility (new) - is so appealing.
Canberra has the highest median weekly rents of any major capital city in Australia, coupled with the lowest vacancy rate (1%).
According to SQM research, the median weekly rental value for a 3-bedroom home in Canberra was a staggering $695 in August 2022.
Canberra has the highest average weekly earnings of any state and territory, and its unique and bureaucratic planning laws mean a constant undersupply of rental properties.
The strong labour market and low housing supply mean that rental prices are historically higher than in Sydney and Melbourne.
While property land tax and rates are higher in the ACT, in comparison to most other major capitals, when you combine the cashflow generated from having two incomes from two separate dwellings whilst maintaining one set of rates and land taxes, Canberra properties are commonly more profitable and stable than any other capital in Australia.
The stamp duty value is determined using that ACT revenue office calculator.
We used the recommended buy price benchmark value researched and provided above to determine the stamp duty value.
In calculating stamp duty, we have not applied the Home Buyer Concession Scheme or Pensioner Duty Concession Scheme and have applied as a non-owner occupier.
Some other costs applied to the "Stamp Duty Plus" in addition to the Stamp Duty.
- Legal fees for conveyancers or solicitors: $2000
- Value of the building, EER and compliance report: $1500
So the calculation of Stamp Duty Plus is: Stamp Duty + Legal Costs + Building Reports.
In the ACT, the buyer of residential property must compensate the seller for the costs of providing the building, pest, energy efficiency and compliance reports.
In the ACT, unlike other Australian states and territories, the full contract for sale is prepared before marketing the property by the seller.
Over the years, as an auctioneer, I have seen examples of buyers paying much more than needed to secure a property and, as an auction bidder paying less, much less than the buyer was prepared to.
For the last three years, I have called, on average, 200 auctions per year as a freelance auctioneer across Canberra and the region.
These 200 auctions have been for 20 different agencies. I did/do this intentionally to learn about the processes around auctions from all perspectives.
I've seen some buyers pay $100k more than they needed to and pay as a bidder $100k less than we would have if pressed or negotiated—generally, it's about timing and circumstance and picking the right agent.
Expertise is defined: as expert skill or knowledge in a particular field.
Do you think an expert can save you 3%, 5%, 10% or more when buying a property?
I wish to forge an ongoing relationship, which means I may need to turn up to 5 or more auctions for you and walk away from all of them if the deal is incorrect or if there is no value.
You will give me a blank pass to bid at an auction and negotiate on multiple properties. This is why we agree to a fee range that you select at the end of the process - 1.75%-2.5% - of the total sale price.
A buyer's agent who negotiates a flat fee is generally motivated by transaction speed. If they are charging a flat fee of $10,000 or 2%, what is the incentive for them to pass over a property in pursuit of a better deal?
I hope to demonstrate your value to you, so you pick the higher fee at the end. I hope to build a strong relationship with you as you build your next property and grow your portfolio.
We are currently compiling a database of rental income examples of granny flats in Canberra.
This will be available in September 2022
We have clients generating 15%-20% utilising Airbnb. https://hotelyourhome.com.au/ are our recommended Airbnb specialist in Canberra.