Client Case Study

Purpose

Lucy wanted to invest in property but wasn’t sure she could do it on her own. She wanted to invest in property because it always felt like a safe option and something familiar. Lucy would typically let her ex-husband handle the investments, he had a good track record, and they had a substantial portfolio before the divorce. She felt out of her depth and needed someone to guide her along her journey. She knew she had to take responsibility for herself now and needed investments that would increase in value and provide her with income in retirement. She also wanted to show her two children what is possible in life. She was ready to step up and take action!

Situation

Our Strategy Session revealed that our client was newly divorced, and her ex-husband usually handled the family finance and investments. They finalised the divorce settlement, where she got the family home valued at $1,800,000 with a very low mortgage of $80,000; and her ex-husband got the three investment properties valued at $1,700,000 with combined mortgages of $1,105,000. Lucy had a good job, close to home but was limited in time she could devote to investment research.

Strategy

Our Discovery Session revealed that Lucy had lots of equity locked up in her home that she could work with. We ran the numbers for Lucy and showed her how she could acquire an investment property with great tax benefits. The strategy was to refinance the home loan to access the equity needed for the purchase. A separate investment loan would be taken from a different bank for the purchase. She loved that she was making her first step towards a property portfolio on her own.

Solution

We worked with our client to arrange finance from an independent broker, once she had her pre-approval in place, she was able to access our Priority Investment List’s exclusive Property Solutions. We presented three Traditional Property Solutions being a Dual Key, House and Land Package and a completed Townhouse. Lucy decided to go with the House and Land package for $513,650 in a sought-after location.

Outcome

Our Annual Review revealed that the property build is nearly complete, and that our client has received an updated local agent appraisal confirming that rents have risen in the area. She will now be able to achieve an increased yield of 6.6% (based on her original purchase price). Our client is now planning to refinance against the uplift in equity to make her next purchase.