All Topics / General Property / city apartment in canberra

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  • Profile photo of peace123peace123
    Member
    @peace123
    Join Date: 2003
    Post Count: 1
    October 26, 2003 - 12:27 pm

    i found a property listed in city of canberra for 200,000 when enquired the agent says it is an investment which gives you 7% pa and is to be leased back to hotel for 10 years and cannot live in it. the chances of capital growth are not high and bank needs about 40% deposit can some suggest is it a good investment strategy keeping in view of 7% rental return without to find tenants and what can be hidden cost keeping other then general rates, land tax and boady corporate.

    Thanks

    Profile photo of HueyHuey
    Participant
    @huey
    Join Date: 2003
    Post Count: 213
    October 26, 2003 - 12:42 pm

    Hi Peace,

    I think other costs can be:

    1. Refurbishing. It can be very costly.

    2. Increase in management fees.

    3. Cost of some unexpected major repairs.

    It’s harder to sell as well.

    Cheers

    Huey

    Profile photo of melbearmelbear
    Member
    @melbear
    Join Date: 2003
    Post Count: 2,429
    October 27, 2003 - 1:15 am

    Hi Peace

    I think the biggest drawback with these is the 40% (I thought it was about 30%?) deposit. For a 7% return! You can do much better things with that whole hunk of cash than settle for 7% with the other costs that Huey has mentioned.

    Is it the James Court – or Saville Suites?

    Cheers
    Mel

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