Case Study

Buying an Investment Property in Brisbane – Keperra Case Study

Buyer's Brief

  • To purchase a property with 15km of the Brisbane CBD with strong capital growth potential and positive cash flow.
  • Budget: Up to $550,000

The Strategy

  • To purchase below the median price for the suburb
  • To manufacture instant equity and improve rental yield by performing major renovation.
  • Plan on holding property long term (15years+).

Our Solution

The Property

  • A 3 bed, 1 bath, post-war weatherboard home on a 612m2 block
  • Purchased for $419,800 in December 2017
  • The property required major renovation (and could not be tenanted in its original condition!)

The Location

  • Located 11.5km from Brisbane CBD in a leafy pocket of Keperra
  • The property is within walking distance to a train station, schools, local shops and parks.
  • Keperra was selected for its strong capital growth potential:
    • Existing Transport Infrastructure: A train line runs through the suburb allowing for quick and convenient access to the Brisbane CBD.
    • Strong Employment. The Australian Defence Force is a major local employer with many employees renting in the surrounding suburbs
    • Gentrification: Housing commission properties in the area are being sold-off and many properties are currently undergoing renovation.
    • New developments: A new Bunnings store has recently opened in the area and additional commercial property is currently being built.  Brisbane City Council has also approved the redevelopment of the Keperra quarry.
    • Adjacent Suburbs: Keperra is also likely to benefit from recent capital growth and development in adjacent Mitchelton.
    • Supply and demand characteristics: rental vacancy rates are low (1.2%), there is limited stock on the market (1.22%), and properties are selling quickly (Average days on market: 38).

The Numbers

Purchase Price:  $419,800
Purchase costs:  $14,680
Renovation costs:
Approximate renovation costs breakdown:
Professional fees (engineering, certifier, builder, approvals): $8,000
New driveway and double carport $16,000
Deck $22,000
Roof + gutters $12,000
Earthworks and landscaping (soft and hard) $10,000
New kitchen $8,000
Tiling and waterproofing (incl. tiles) $3,000
Floor sanding and polishing $3,100
Plastering + painting (labour and materials): $7,000
Asbestos removal $3,200
Other $27,700
Total Renovation Cost $120,000
Total Spend $554,480
Current valuation:  $580,000
Net equity gain:  $25,520
Previous rent:  Non-rentable
Current rent:  $520/wk

Cash Flow Analysis

The property is cash flow positive after tax by $72/wk based on the following assumptions:

  • Finance Amount: $554,480
  • Interest only loan @ 3.8%
  • Current marginal tax rate 37%
  • Rent @ $520/wk with 2% vacancy rate
  • Depreciating the cost of renovations


By adopting a renovate and hold strategy, it was possible to purchase a property in an area tipped for strong capital growth, and achieve positive cash flow.

Buyers Agent Keperra Case Study Internal

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