Unless you’ve been living under a rock, you will know that “money is very cheap” (interest rates are low) right now. That is great for borrowers, but can make life very hard for buyers of investment property, because yields usually decrease in-line with the cost of borrowing.

More and more investors are turning to buyer’s agents in order to find properties with great cashflow that don’t come with an equally large amount of risk. Identifying property with this kind of potential takes real skill, and as the good deals tend to be snapped up quickly, you still need to be ready to move quickly when the opportunity arises.

Dean approached us a few months ago with an interesting brief: he had a high budget, with great existing equity to leverage against, and wanted a highervalue property that would pay itself off (both principal and interest) over time without him having to put any cash in.

It took us a few weeks to identify the right deal for him and it was through Peter Ambrose’s private network of investors in Wellington. One of Peter’s contacts had converted an inner-city property in the capital to two 5-bedroom flats in the past and was looking to exit. The vendor was prepared to sell to another investor at an 8% gross yield, however with a price of close to $1.5 million there was a lot of due diligence required.

Dean is based in Auckland, and a big part of working with an investment property buyer’s agent is access to their team of local industry experts. Depending on the deal you might need quick access to the right property managers, insurance brokers (important in Wellington), building inspectors, tradespeople, architects, surveyors and more. Peter was able to line up the right professionals to assist Dean make a fantastic buy that will pay for itself entirely, eventually giving Dean a “free property” worth over $1.5 million in today’s value and a rent roll of over $100,000pa.

You don’t need a seven-figure budget to invest well, you just need to have access to a good deal when it comes up. Kate Feeney recently helped two Whakatane-based clients land a great deal in Whanganui in another case of the right buyer being ready at the right time.

The deal was in a fast appreciating suburb and comprised two dwellings, which were rented for $170 + $160 respectively ($330 pw) giving a 6% gross yield on the appraised price range of $250,000-$300,000.

Some work was required to bring the property up to the Healthy Homes legislation and in addition there was deferred maintenance required on the front house, such as some painting work. Quotes for this were obtained for the buyer during the due diligence process.

All-in-all Kate identified that the actual gross yield on market rate would be around 8.4% and there is the potential to add a third dwelling at a similar high yield (subject to council consent).

With the upside in value and rent correctly identified, the buyers won the property at a deadline sale with enough due-diligence time to then properly assess potential risks and are now the happy owners of a profitable dual-income investment property.

These are just two examples of how buyers are leveraging modern communication technology and local networks of experts to analyse and secure deals that help build financial freedom, no matter where they happen to live. There is simply no longer any reason to think “well I can’t do that” when you hear of successful investor’s stories, you just need the right team on your side.