Hi Guys,
I have recently started looking to the future with Investment Properties and would like some advice if possible.
Initially i was very interested in the idea of purchasing a studio / 1 bed apartment and rent this out to students / temporary professionals. The initial 150K purchase price and the rental return were the key figures that lured me to these. This was mainly due to the low deposit required (about 15-20K) and the fact that if in the case that it wasn't rented, i could cover the costs of servicing the loan etc.
I was looking to start my own investment company / trust with this property under the banner and slowly increase the number of investment properties as time goes by. The idea behind this was to have a number of apartments paid for so i had an income at time of retirement. This would be purely for a future income when i decide to retire in 40 odd years. I have no interest in taking any income from these properties now.
Now i see that a lot of people on this forum are against this due to the unpredictability of tenants and also the studio appreciating.
I would love to get some information and advice on what i should do? I am 25yrs old and looking at these purely for retirement. If anyone can help, that would be greatly appreciated
Thanks
The problem you are going to have with 1brm studios is one of financing them. If <50m2 it can be done but there are a limited number of lenders who firstly will do it and secondly will do it at a decent LVR.
Depending where the studios are, they will do OK with CG – but this is dependant on location and the (large) management fees involoved with studios which are commonly in a rental pool.Your strategy of accumlating property now and providing for your retirement is a good one. If you choose well, in a high rental demand area, you should not be concerned with having much vacancy at all. It all comes down to good selection criteria.
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