Property Investment and Risk Management

Running head: PROPERTY INVESTMENT AND RISK MANAGEMENT
Property Investment and Risk Management
Name of the Student:
Name of the University:
Authors Note:

PROPERTY INVESTMENT AND RISK MANAGEMENT
1
Contents
Introduction:....................................................................................................................................2
Property market:..............................................................................................................................3
Requirements of mortgage:..............................................................................................................4
Ratio calculation and analysis:........................................................................................................7
Conclusion:....................................................................................................................................10
References:....................................................................................................................................12

PROPERTY INVESTMENT AND RISK MANAGEMENT
2
Introduction:
18-20 Ettalong Street property is situated in Auburn, New South Wales, Australia has a total land
area of 1220 square meter. The property is an ideal property for tenant investment with whole
extent of property is fully furnished and desirable for tenant agreements. The property is highly
desirable as the location of the property boosts of the following characteristics:
I. 22 primary schools located around the location of the property.
II. 70 DA approved places.
III. The metro is situated nearby the property.
The map below will help the prospective investors to understand the exact location of the
property.
Image: The location map of the property.

PROPERTY INVESTMENT AND RISK MANAGEMENT
3
The infrastructure and transportation facility in and around the property is extremely efficient
making the property immensely attractive for the investors.
Property market:
The property market in Australia and specifically in NSW is extremely vibrant. The demand of
property in the region is quite high. This is mainly due to both the environment and infrastructure
of the region. Over the years the property market in Australia has developed at a rapid speed and
NSW has been in the fore front of this development. The demand of property in NSW region is
quite high but the supply commensurate property has made the property market in the region
vibrant and prosperous. The vacancy rate in region for rental property is generally within the
range of 15% to 20%. The average rent in NSW is quite high due to the high demand of rental
property in the region. Thus, the investors have added incentive of making available of their
properties for rental agreements. High rate of return is generally earned by the investors by
entering into rental agreements with tenants in the region (Sweeney, 2014).
In this case the location of the property, i.e. 18-20 Ettalong Street property in Auburn, New
South Wales makes the property even more attractive for the investors as it has number of
characteristics which are extremely important for any tenants including close proximity of
number of primary schools and other infrastructural advantages. At present the rental of the
property is $93,600 per annum as per the best estimates made from the available information
("Real estate investment decision making – a review", 2017).
The stamp duty for the property is estimated to be $116,115. The property can be used for office
purposes as it has a floor area of 1220 square meter.