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South Hedland - 6 Hedditch St

Exciting New Armchair Developer Project.

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Initial outlay by investors will be $135,000 with a further $267,000 upon completion. This will provide a potential capital gain of $141,000 and be a cashflow positive property with a rent return of over 17%.

South Hedland is a key regional town in Western Australia’s Pilbara region.

Investment by the WA State Government, multi-national mining companies and second tier resource companies has driven property prices upwards in South Hedland for many years. This, combined with extremely low vacancy rates and very high rent returns, provides an ideal scenario for property investors.

The population of South Hedland is forecast to grow from 15000 people to 40,000  by 2024

Massive and continued expansion of resources, and significant investment by BHP, FMG, Rio Tinto, Atlas, Hancock in resource projects for the West Pilbara and Hedland continue to drive local economies and provide outstanding property investment opportunities.

 

Project Overview

Total outlay $409K
Final est. Value $550K
Est. Profit $141K
Yield ~$67,600/pa  (16.5% ROI)

   

 

           

Intentions:

We will develop this site into ten, one bedroom, one bathroom units with single carports.   Completion should be within 12 months.

 

Profit forecast:

Costs per Investor: (estimates)

Land $135,000
Construction $274,000
Total $409,000

                                                   

                                                                             

Est current market value $550,000

                  

Capital Gain $141,000
Yield (rent) $ 67,600/16.5% P/A

                                  

                                  

The total cost to investors of $409,000 includes interest on construction loan, furniture, stamp duty, borrowing fees and  commissions .   Full details are available in the Information Memorandum (IM) for each project.

Investors need to be able to fund the initial deposit of $135,000 from other sources however the final borrowing can be against the South Hedland property.  Estimates indicate that if all funds are borrowed, the annual cash flow will be approximately $27,000 positive.

 

Construction:

Both residential and commercial construction in the Pilbara can be problematic.  Builders need to be able to manage a range of difficulties not faced in Perth.  These include weather conditions, strict building codes (cyclonic), an expensive labour market and transport costs.

We are recommending McGovern Construction for the following reasons:

-          Experience in the north

-          Large construction firm

-          Solid concrete construction

-          Built in Perth as a modular construction, fully fitted out and transported

-          Fixed price

-          Reliable construction times

 

Tax:

All investors are responsible for seeking their own tax advice, but they need to be aware that selling the property may attract both capital gains tax and GST.

Click here to download a complete  PROPERTY REPORT

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Disclaimer IMPORTANT:  This is not advice.  Clients should not act solely on the basis of the material contained inthis document.  Items herein are general comments only and do not constitute or convey advice per se.  Every effort is made to ensure the contents are accurate at the time of publication but clients need to be aware the figures are all estimates.  Clients should seek their own independent professional advice before making  any decision or taking action.  We take no responsibility for any subsequent action that may arise from the use of this document.  Published by Eos Property Group