I have come across a property in “Palgarup” (country WA – near Manjimup) that is a 3 bedroom, 1 bath Fibro home. I have only seen pictures but it is being offered for approx $65k with a tenant paying $100 per week….though The agent tells me he thinks we can get more rental from the property than $100 per week…like $110-$120.
I am thinking of placing an offer on the property for approx $55K…
I am wondering what proples opinions are on Fibro made homes?
I am new to this site and were just wondering on what peoples opinions are on this prospective investment?Thanks
Thayer [
]Welcome aboard! I’d be careful about posting too many details regarding exact locations as you may find your deal taken by the time you get back to contacting the agent.
I’d look at size of the town, industry, prospects for the future, number of renters etc and if it still stacked up, then go for it.
A.
Hi, I have a fibro home and it’s been the least trouble of all
The only money I’ve had to spend on it was for a new fence! Mine is made with concrete stumps, which apparently eliminates the need for re-stumping, too. They are usually built to be very strong… sounds like a good investment on face value but obviously it depends on other circumstances as well.Thanks for the advice/info “soleil” and “ANUBIS”…much appreciated. Will see how it goes
Thayer
I have lived in my fibro home for 13 years without any trouble.
My only word of warning – if you renovate, depending on the age of the fibro you need to be careful of asbestos. If left alone it is fine.
Shushar[
]“All our dreams can come true, if we have the courage to pursue them.” – Walt Disney
sounds like a $65k headache to me
Thayer
If the deal looks good go for it, do the “RESEARCH” though
“The man that thinks at 5o as he did when he was 20 has wasted 30 years of his life”
Thayer
Whats your opinion of the investment ??
Take this the right way but rather than search ‘realestate.com’ or such then post deals on the site, asking others on the viability of the deal,do some reasearch on the town, population, proximity to services and larger towns, prospect of getting tenants if the one in place departs ( don’t always believe the Agent selling the property ! )
Also by posting ‘all’ the details you could find yourself losing the deal rapidly. Do some research on the areas you’re interested in and then post queries on the Forum,and, believe me everyone here is quiet helpfull and will assist you in your efforts to find a property that meets your need’s and that you’re comfortable with… remember anyone can give you advice,but, you have to be comfortable with the deal..
Wish you all the best [^]
Redwing
“The man that thinks at 5o as he did when he was 20 has wasted 30 years of his life”
Hi Thayer
I come from SW WA and I haven’t even heard of the place so it must be tiny!
I agree with others re independent research.
$100pw @ $65k is pretty poor given the size of the place. $110pw @ 55k is not bad, but my gut feeling would be to favour an even higher return for a place so small unless you think it’s got growth prospects. Also it could be a problem to manage or to get tradespeople out.
Check out country WA towns & cities with populations between 3000 – 30000 and look at sale prices & rents. You might get something with slightly lower yield but vastly lower risk especially if you plan to hold for the long term.
Regards,
Peter
Good advice from Redwing and Peter. Nothing wrong with fibro houses but do check your area very carefully for industry and employment prospects.
If I knew then what I know now……….you know how it goes
I have done some research into towns such as Mt Barker and Manjimup and was turned off by the higher than normal vacancy rates. Hell – I know the area is beautiful but there seems to be a lack of people wanting to move there.
I would be careful and make sure you do plenty of reseach first.
Good luck Thaer
‘Eat rich food, barbeque a yuppie’
the younger ppl of these areas can’t wait to move out, i was born and lived in manjimup and my extended family still live there, it’s a great area, but they survived on the mill industry for years which is now almost dead. most ppl are moving up to bunbury or perth for job prospects. there is only a handful of shops and ppl are settled in there for long term jobs as they obviously don’t wish to leave the area. the wineries are really getting up and going now. keep an eye on the region though, there are some HUGE developments taking place in the next 10 years from what i’ve read, more towards the cowaramup area.
You could always try to wrap it.
then you would get some real return out of it:
Perhaps this will look better if I explain (or NOT)
You Buy say $60K
Your costs $15K – inc closing costs
Mortgage = 45K
Interest (P&I) @ 7.5%
Payments: = $76.75/week
rates and Water = $10/week
Total = $86.75/ weekYou Resell @ 72K
Deposit = 10K
Total owing: 62K
Int rate(p&I) = 9.5%
Payments = $135/week (inc $10.00 rates etc)
********************************************
$135 – $86.75 = $48.25 (+tve Cashflow)
as you have recieved $10K deposit….. you can either take it off your mortgage and further reduce your payments….. or re invest…. let us see the 2 options.
1. pay $10k off your mortgage = $35K = $69.70(inc rates etc)
CoCR = $5000/$4511(annual net cashflow) = 90%
ROI = 13months (approx)2. pocket $10K for reinvesting:
mortgage = $45K = $86.75(inc rates etc)
CoCR = $15000/$4511(annual net cashflow) = 30%
ROI = 13months (approx)
Still this is much better than les than 10% on the rental scenario.
Something to consider anyway
As you can see dthis could be atractive for a home buyer that is renting as it is only around $20 more per week than renting (Inluding rates)- If the going rate is $100-$120/week
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