If I’ve got $200K in equity, what’s a sensible first co-living project size?

Answering: If I’ve got $200K in equity, what’s a sensible first co-living project size?

Estimated reading time: 10 min read

With $200K in equity, a sensible first co-living project in Melbourne sits between $850K and $950K for a 4-bed property, or up to $1M if you prefer a 5-bed configuration with growth potential. Your equity position supports standard 80% lending while maintaining a buffer for stamp duty, legal fees, and contingencies that every prudent investor needs. Based on Harmony Group’s analysis of 200+ high-yield projects worth over $210 million, investors who start with a 4-bed property around $900K typically see $200 to $400 weekly positive cash flow from settlement, with the flexibility to scale to additional properties once they have 12 months of performance data behind them.

You have worked hard to build that equity, and the last thing you want is to overextend on your first project and find yourself stressed about cash flow. The concern about getting the sizing right is completely valid. Too small and you leave potential returns on the table. Too large and you risk compromising your financial buffer when unexpected costs arise.

The reality is that success depends on matching your project size to both your equity position and your personal risk tolerance. Conservative investors who prioritise safety margins target the $900K mark, leaving approximately $100K buffer for contingencies. Growth-focused investors comfortable with tighter margins can stretch to $1M for a 5-bed property that generates stronger weekly income. Neither approach is wrong, but knowing which suits your circumstances before you speak to a broker makes all the difference.

With team experience spanning 200+ high-yield projects across 30+ councils and 93% of selected properties meeting or exceeding initial income projections, the Melbourne market offers clear entry points for investors at your equity level. This guide breaks down exactly how to size your first project across Melbourne, Adelaide, and Perth so you can make an informed decision.

Key Insights

• Co-living project sizing Melbourne comes down to a simple choice at your equity level: $900K for conservative entry with buffer or $1M for growth-focused cash flow.
• Both options deliver 10 to 12% gross yields compared to 3 to 4% from traditional rentals in the same areas.

Keep reading for full details below.

Table of Contents

• Understanding Your $200K Equity Position
• Project Sizing Across Melbourne, Adelaide and Perth
• Risk Management and Buffer Strategies
• Closing
• Frequently Asked Questions
• Want to Learn More?
• Citations

Understanding Your $200K Equity Position

Your $200K equity creates a clear purchasing window when you apply standard 80% lending ratios. This means you can comfortably target properties up to $1M while retaining funds for stamp duty at approximately 4.5% in Victoria, legal fees, and a contingency reserve. The mathematics work the same whether you are looking at Melbourne, Adelaide, or Perth, though entry costs and yields vary by market.

The question most investors ask is whether to use all available equity or hold some back. Harmony Group’s portfolio data shows that conservative investors targeting $900K maintain a $100K safety margin, while growth-focused investors stretch to $1M with tighter buffers. Your choice should reflect how you handle financial uncertainty, not what generates the highest theoretical return.

Banks assess co-living properties differently from traditional rentals, particularly on first projects. Expect additional scrutiny until you establish 12 months of rental performance data that demonstrates consistent tenant demand and occupancy rates. Getting pre-approval that specifically mentions your co-living intent is essential to avoid surprises later in the process.

Your usable equity figure needs to account for emergency reserves you want to keep separate from your investment. Many investors make the mistake of calculating equity without setting aside funds for their own financial security outside the property.

• Calculate exact usable equity after separating emergency reserves and consult a specialist broker to confirm lending capacity in Victoria
• Determine your risk tolerance before pre-approval conversations so lenders assess realistic scenarios from the start

Project Sizing Across Melbourne, Adelaide and Perth

Melbourne 4-bed co-living properties in growth corridors range from $850K to $950K and deliver $1,400 to $1,600 weekly rental income. Suburbs including Footscray, Brunswick, and Coburg consistently perform within these bands, with specialist property management teams maintaining 98%+ occupancy rates. These are not theoretical projections but repeatable outcomes from existing portfolios.

Adelaide offers similar 4-bed configurations at $800K to $900K with comparable yields but lower entry costs, making it attractive for investors who want maximum buffer. Perth 4-bed properties sit around $950K but generate stronger yields at 10 to 12% gross due to mining sector demand and acute housing shortages in key areas. Your market choice affects both entry cost and yield profile.

Moving to a 5-bed property adds $100K to $150K to your purchase price but typically increases weekly income by $300 to $400. This improved cash flow velocity matters for investors planning to scale their portfolio quickly using deposit recycling strategies. Harmony Group’s 118-point analysis framework identifies properties meeting this performance threshold before acquisition, filtering out options that look attractive on paper but fail under closer examination.

State-specific stamp duty significantly affects your effective equity position. Victoria charges approximately 4.5%, South Australia around 3.5%, and Western Australia about 4%. These differences of tens of thousands of dollars should be modelled before you commit to a particular market.

• Request actual income statements from existing co-living properties in your target area rather than relying on projections
• Factor stamp duty into your equity calculations for each state you are considering

Risk Management and Buffer Strategies

The 4-bed $900K option leaves approximately $100K buffer for unexpected costs, vacancy periods, or market adjustments. This buffer is critical for investors managing their first co-living property without established cash flow history to fall back on. Starting with breathing room lets you learn the model without financial pressure.

Professional property managers specialising in co-living maintain 98%+ occupancy rates with tenant waitlists in high-demand areas. This changes how you think about conservative sizing. It becomes less about fear and more about predictable cash flow while you build experience and confidence in the model.

Starting conservative allows you to prove the concept with one property before scaling. Most successful investors add a second property after 12 to 18 months once they see positive cash flow from settlement and have auditable performance data that banks accept for subsequent lending applications. Patience at the start accelerates growth later.

Each additional bedroom typically adds $75K to $100K to the property cost but generates $15K to $20K additional annual rental income. The decision tree is straightforward: if safety margin matters to you, stay at $900K with a 4-bed property. If growth velocity matters more, stretch to $1M for a 5-bed configuration with higher weekly income potential.

• Model worst-case scenarios including 3-month vacancy periods and compare outcomes between both options using your actual mortgage rate
• Build relationships with specialist co-living property managers before purchasing and confirm they maintain 98%+ occupancy with active waitlists

Closing

Co-living project sizing Melbourne ultimately comes down to your personal risk tolerance and growth timeline. Property investment in this sector rewards both conservative and growth-focused approaches when matched correctly to your equity position. Start with one property that fits your comfort level, prove the model with 12 months of cash flow data, then scale to additional acquisitions using deposit recycling once you have performance history behind you.

For a deeper look, visit https://theharmonygroup.com.au/contact-us/

Frequently Asked Questions

Q: Can I really get positive cash flow from day one with a co-living property?

A: Yes, with proper sizing to your equity position and specialist property management. A 4-bed co-living property at $900K typically generates $1,400–$1,600 weekly rental income; after mortgage payments at current rates (approximately $800–$1,000 weekly), property management (8–10%), maintenance, and council rates, most investors see $200–$400 weekly positive cash flow from settlement. The key is working with specialist managers who maintain 98%+ occupancy rates and choosing properties in high-demand areas with established tenant waitlists. Harmony Group’s portfolio confirms this is repeatable across Melbourne, Adelaide, and Perth when you match project sizing to your equity position and risk tolerance.

Q: What’s the difference between using a property manager versus managing the property myself?

A: Specialist co-living property managers maintain 98%+ occupancy rates through active tenant screening, maintenance protocols, and established waitlists—outcomes self-managed properties rarely achieve. Managing co-living yourself introduces vacancy risk, higher tenant turnover, and compliance complexity; the 8–10% management fee typically pays for itself through reduced vacancy periods and faster tenant replacement. If you’re building a portfolio, delegating to specialists frees you to focus on acquisition and scaling strategy rather than day-to-day operations.

Q: How long before I can add a second property to my portfolio?

A: Most successful investors add a second property after 12–18 months once they’ve generated auditable rental performance data from their first property. Banks become significantly more flexible with lending once you can show actual cash flow history rather than projections; this enables portfolio acceleration through deposit recycling. Starting conservative with a 4-bed at $900K and proving the model allows you to scale to 5-bed properties or multiple acquisitions within a 3–5 year timeframe.

Q: What’s my first step if I want to explore co-living project sizing for my $200K equity?

A: Book a consultation with co-living specialists who can show actual project performance data, occupancy rates, and tenant feedback—not projections. Request income statements from existing co-living properties in your target suburb, confirm 1B certification pathways with local councils, and get pre-approval from your lender mentioning co-living investment intent. This groundwork typically takes 2–3 weeks and removes decision paralysis before you commit to a specific property.

Want to Learn More?

We’ve drawn on 15 years of collective team experience across 200+ high-yield property investment projects worth $210+ million to create this comprehensive guide for Australian investors. Our approach prioritises your financial position and risk tolerance over sales pressure—if a project sizing doesn’t suit your circumstances, we’ll say so directly.

Citations

• “Welcome to INVIDA” — INVIDA specialises in co-living property analysis and project vetting across Australia, providing investors with performance data and compliance assessments for properties matching co-living project sizing criteria. https://invida.com.au/
• “Investing in Co-Living Property (Heaps Good Homes)” — This resource validates pricing bands and rental yield expectations for 4-bed and 5-bed co-living properties across Melbourne, Adelaide, and Perth markets, confirming market positioning for different equity positions. https://www.heapsgoodhomes.com.au/blog/investing-in-co-living-property
• “Co Living Property Investments Melbourne, Australia” — Co Living Property Investments Melbourne provides current market data and project examples across growth corridor suburbs including Footscray, Brunswick, and Coburg, helping investors compare specific suburb yields and occupancy performance. https://colivinghomes.au/

Co-living properties must meet Victorian Building Authority 1B certification requirements for Melbourne; equivalent regulatory frameworks apply in South Australia (Building Rules) and Western Australia (Building Code of Australia). Confirming compliance before acquisition is non-negotiable.

If you’d like to learn more, visit https://theharmonygroup.com.au/contact-us/ to explore how we approach co-living project sizing for investors with $200K equity across Melbourne, Adelaide, and Perth markets.

Ready to move forward? The data shows that investors who start conservative with one properly sized 4-bed property, prove the model over 12 months, and then scale generate portfolios that outperform traditional property investment significantly. You’ve built the equity—now it’s about matching that capital to the right project, the right location, and the right team. If you’re serious about co-living yields but want clarity on your specific position before committing, that’s exactly the conversation we’re equipped to have.