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You have to be careful with contracts, wording is everything
If it is subject to fiance that only means can you get out if the bank won't give you a loan, has nothing to do with the valuation. If the fiance clause says it is subject to a satisfactory valuation then you are covered. I have always preferred to give a figure on the valuation clause so there is no doubt e.g bank valuation must match purchase price or bank valuation needs to be within 5K. I have been advised in the past that if the purchaser wanted they could still enforce the purchase on a generic finance clause in this case as the bank is willing to lend you the money and you have the ability to met the shortfall with the valuation.
Most vendors won't figth it but they do have that ability if they want.
Thank you mike for the report. Very interesting read.
Thank you again
KaneHi Gary
I didn't have any problem with the Banks due to the NRAS but i did have issues with valuations. Some valued the new property low and some valved my PPOR low (for the LOC). Ended up with the NAB. They valued the new property at the going price, paramount said the vauler they use is on the panel for the NAB . They valued my PPOR 10k low, the valuer did a site visit after the loans had been drawn up and reassessed his paper valuation and came up with the same figure i had. The rest of the problem was with the commonwealth, they had lost some paper work that held us for about 3 weeks.
Kane
Hi Gary
It was paramount i went with. There are other ones i wouldn't touch but that was mainly because too much of the development was dedicated to the NRAS scheme. There wasn't a good mixture of home buyers, private investor and NRAS. I personally feel that these types of development could end up as a bad area. Especially the apartment blocks.
Kane
Hi Gary
The property was completed at the end of November and was built to a good standard. The tenant has been great so far, no problems with rent, their employed and they keep the property clean( a little early to make a full judgment).
The developers have been helpful and understanding all the way through (issues with banks). They seem to be doing a good job as property managers and don't have any complaints yet.
The property price seem comparable to other new builds in the area. It is a bit more expensive than existing properties.
There are starting to be a fair few companies offering this scheme. There are a few i wouldn't go near but there are some, like the one i went with that i believe are worth giving a go. The way I looked at it was that i would probably have bought this property without the NRAS so it's just a bonus.
Wuzziemoo
These guys were quite good to deal with.
http://www.piedu.com.au/
Regards
KaneHi Chillbaby
Thank you for that info. Currently waiting on finance for property in TAZ, if that falls through I'll give them a ring. Have had contact with them before on a another property in andrews farm in adelaide and they where good to work with.
Kane
I have decided to go ahead with the NRAS property in Taz and I am currently just waiting for the bank valuation to come back for finance. I was looking at doing a new build anyway so the government rebate just helps make the property more attractive. If the scheme gets canceled by a future government then the rent goes back up to the market value or i can sell it with no conditions in place. Looked long and hard at a lot of scheme's and decided this property was the best for me.
As i have said before i can see some of the developements having problems later because of the large number of properties dedicated to just this scheme, if not all. I much prefer where they make up a small percentage in a large developement.
KY made comments about the figures $280 thousand house rented for $407 pw. The maket rent would be around $300 pw, take 20% discount = $240 is what the property will be marketed for and then add the government rebate currently about $167pw so you get your 407pw.
Hi wealth4life
I got interested in this scheme because the the government payment makes some of the properties cash positive. You still get to choose your tenants. They don't need to be unemployed to be able to rent the property. Single person can earn up to 50K and a couple with kids up to 86K.
Would stay away form developments with a large number or all their properties in this scheme. It's the same as any other investment you have to looks to see if it meets you criteria ( area , price, fees, amenities).You can sell within the 10 year period but it needs to stay in the scheme or another property used in its place. The defense housing seem to sell with long term contracts still in place these should be able to as well. Planning to keep for 10 years anyway
Kane
Hi Dee
The winners of Round 2 of the NRAS submissions are meant to be announced mid this month. Hopefully there are some investment companies involved in SA. If there is larger group allows people to bring there own properties in they will charge a fee for the managing the NRAS component and the tenacity management. The property also has to meet certain criteria in regards to location and building standards.
Regards
KaneGreat tip Thanks
Kane
Hi Dan
Thank you for your feedback, this is the type of information I was after. Looking at doing a new build as part of the NRAS scheme and Rokeby ended up a slightly cash positive investment. As an investment this is the market I'm aiming for, generally with blue collar workers there is always demand for rental accommodation and they are decent tenants. As the the area get older and the sprawl spreads the prices go up.
Kane
You can get the ANZ breakfree package. You get the 0.7% off and you get the offset account as well. It costs $340 a year but you make that back in savings.
Cheers
Kane
Hi Richard
Both properties are in SA, the GCT on the IP will not be much as this was my PPOR until 12months ago. Currently getting between 85-100k a year so im at 41cents in the dollar. PPOR is at a variable rate and the IP is fixed but am willing to break.
Regards
Kane
