Serviced apartments

Viewing 7 posts - 1 through 7 (of 7 total)

Raider11
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@raider11
Join Date: 2016
Post Count: 2
January 27, 2016 - 6:09 pm
Hi all I would like to know if anyone has invested in serviced apartments before and if this has been a good investment. Also if there is hidden costs on completion of lease.
Regards Raider
Redwood
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@redwood
Join Date: 2013
Post Count: 340
January 27, 2016 - 7:37 pm
There is a heap of content on serviced apartments here and elsewhere. It is a big NO.
They have no capital growth and yes a high yield but you need both to have a successful investment. You may also have issues financing the investment as most lenders donot like the security. Never seen one that is a success most like student accommodation. Cheers Ivan
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Worm
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@worm
Join Date: 2016
Post Count: 2
January 27, 2016 - 9:08 pm
I have a Quest apartment. Purchased in my SMSF – it was 300K for a 2 bed, 2 bath. It is rented back to Quest for 26K per year. The lease ends in 2025 at which point it could potentially be back on the open market as a normal apartment. It will be worth a whole lot more then. This is not my only Property – it’s part of a balanced growth vs cashflow positive portfolio. Lenders treat it like a commercial loan an only lend up to 65%. After costs I’m adding an extra $1000 to my SMSF on top of my salary contributions.
Redwood
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@redwood
Join Date: 2013
Post Count: 340
January 27, 2016 - 11:19 pm
What makes you think it will be worth a lot more Worm?
Cheers Ivan
Redwood | REDWOOD | SMSF | PROPERTY | FINANCE
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Raider11
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@raider11
Join Date: 2016
Post Count: 2
January 28, 2016 - 6:43 am
Thanks redwood think i will look elsewhere.
Jamie Moore
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@jamie-m
Join Date: 2010
Post Count: 5,069
January 28, 2016 - 1:19 pm
Banks don’t like them – they generally expect at least a 30% deposit so that says something.
High yields seem attractive – until the management costs quickly erode the benefits.
There’s generally bugger all growth too.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
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Redwood
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@redwood
Join Date: 2013
Post Count: 340
January 28, 2016 - 9:08 pm
Good stuff Work – take my feedback constructively. Good luck on your journey
Cheers Ivan
Redwood | REDWOOD | SMSF | PROPERTY | FINANCE
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SMSF - PROPERTY INVESTMENT - WEALTH CREATION AND FINANCE SOLUTIONS