Taking on projects in an upward market

Posted 21 Dec '20

by Simon Tavendale on
Article appears under: Case Studies, About Property Investment, Covid-19, Investment Strategy, Renovations and Maintenance

Looking to add a minor dwelling to increase value and achieve higher returns? Here is an example of a minor dwelling conversion completed December 2020.

The property was purchased February 2020 and sourced privately through a vendor who came to know of iFindProperty after the neighbouring property was purchased for another client using the Premium Buyers Service. The client was not wanting to proceed with this second opportunity.

The property consisted of a 2-bedroom ex-state home with a large skyline garage. The existing 2-bedroom dwelling was in good condition, apart from minor modifications required to meet the new Healthy Homes Standards and returned an income from day one as the vendor wished to rent back the property for a short period (later extended due to COVID).

The skyline garage consisted of a double garage, lined utility room and bathroom. We engaged local contacts to assist with the consent and planning and local builders to complete the building work. Due to the size of the garage at 72 square m, it was possible to add 3-bedrooms with an open plan living dining and kitchen area, as well as combined bathroom and laundry.

Finance was sourced via a second-tier lender at, believe it or not, 8.45% interest for one year on 100% of the purchase price, plus a portion of the build cost as well as capitalised interest for 6 months.

Although completed behind schedule due to COVID, our local network of tradespeople and service suppliers were able to pull out all the stops to get this job completed and tenanted before Christmas. Here is what the numbers look like after completion.

Purchase price


Renovation costs


Interest & financing costs




Weekly Rent

$400 + $430 = $830

Gross yield


Don’t be afraid to take on projects of this nature particularly in an upward market where capital growth can be achieved through general movement in the market as well as value added via renovation.

Simon Tavendale
Property Investment Specialist - Palmerston North
022 504 8500

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