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Purchased
Entry level asset with no stamp duty!
This was our valued client’s first purchase with Rethink Investing. They were looking to invest in either South Australia or the ACT to avoid stamp duty for their SMSF purchase. This entry-level 233m2 industrial property in Adelaide was perfect. We saved our client a lot of money by securing it off-market, and since it’s located in South Australia, there was no stamp duty. Extra upsides for this asset include a four year lease and being located less than 10km from the CBD.
Purchase Details
Asking Price
590000
Purchase Price
537500
Deposit (assuming
70
% debt)
161250
Stamp Duty
0
Building Report*
700
Solicitor Cost*
4000
Valuation*
2000
Other Costs*
Other Fees* (Depreciation
report, bank fees)
report, bank fees)
590000
Total Cash Required
167950
Purchase Price + Purchasing Cost
544200
Net Annual Cash Flow Return
33500
Net Yield on Property
6.23
%
Net Yield Accounting for
Purchasing Costs
Purchasing Costs
6.16
%
Cash-OnCash Returns
Deposit Needed =
% + Costs
167950
Cost of Loan
(Assume
3
% pa on
70
% debt)
11287.5
Return of Equity
(Pure cash flow return)
13.23
%
Return of Equity with a
5% Capital Growth Rate:
29.23
%
Return of Equity with a
7% Capital Growth Rate:
35.63
%
Return of Equity
10% Capital Growth Rate:
45.23
%
*approximate number
Key Highlights
• Building Area: 200m2
• Land Area: 200m2
• 6.2% net income + Growth
• 4+3 year lease
• 3% annual increases in the rent + 3 month bank guarantee
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