Hi everyone, my wife and I are considering picking up a Defence Housing property. The ones that are often advertised in Australian Property Investor. The yields are about 4% with 16.5% management fee, but you do get a long lease (9 years) and all management issues and repairs taken care of. Have any of you done this before. Pros/Cons/Thoughts all appreciated.
Thanks, Jeffrey and Natascha
Hi Jeff/Tash,
This question gets asked fairly often and you’ll find those that like DHA property and then there are those who do not like it.
Try the ‘search’ button which is located just under the ‘forum boards’ button in the top left corner.
Ultimately it becomes a matter of free choice.
Derek
[email protected]
0409 882 958
Property investment advice and researched property in quality locations available.I’m one of the ones who has a DHA property and am quite happy. If you have any specific questions I would gladly answer them.
Cheers,
Mick
I am currently serving in the RAN.
My advice is to buy in areas where the the government is spending money on up grading the bases.
Cairns navy base has been approved for a big upgrade so to be able to accomodate the new Armidale Patrol Boats. There will be more personnel posted to Cairns and the area in figures released last week is to grow faster than South East Queensland in the next 20 years.
Townsville has been given the go ahead to have a detachment of American soldiers move there to live and train in the area and in Darwin.
Also Rockingham area in WA is a good pick considering the new train line which comes online next year and the Anzac class ships moving from East based to West based in the years to come.
Keeping in mind that these properties won’t be cash flow positive.
Being an insider, I have been advised by DHA that you will only come out on top if you keep the property for the 9 year period and not sell.
Hi guys,
I think DHA properties are a safe investment in terms of a long lease good tenants having repairs paid for you by the defence force as well as the property being recarpeted and painted. You can claim the depreciation of the property and claim money back on tax.
However as you said you make about 4% on your investment where the banks are now paying 5% and the ACR is paying up to 7%. With interest rates to rise by 0.25% in the next two weeks and another 0.25% in April/May you may as well place your money in the bank and have less stress and hassles.
I think you are better off finding a property which is +cf if you don’t wish to work harder to pay for the DHA but that is just my opinion.
You may have found a good area which is expecting a lot of capital gains in a downward market and in which case I hope it turns out well.easymoney
4% doesn’t sound like much of a return for something that ties your investment up for 9 years.
Based on the investment and return 16.5% sounds like a high management fee to me for something I assume would have a good class of tenant residing in it.
I feel the Govt. is the winner on that one.
Only my opinion.
I looked hard at DHA properties a year or so ago. As some of the other posters mentioned, the return is a pretty slow drag @ around 4%. Of course, risk = return and they are parctically hazard free investments. The entry prices were a bit rich for my blood, as I prefer small fish properties under 150k. Anyhow, go to the link below and sign up for their email newsletter if you haven’t already. Cheers, nw
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