It seems many of us are all fired up about the 11 second solution for positive cashflow, but suddenly hit a barrier finding properties that even come close to passing the test.
Just as a test (I’m not quite ready to buy yet), I did a dry run of searching for properties over the last few days. The closest I managed was a small complex of units far west of Brisbane.
From other posts I’ve read, plenty of people have the same problem.
I was thinking about ways to increase the rental returns of properties, so that they do meet (or get close to) the 10.4% positive cashflow target.
I have only come up with two ideas so far, and neither are original.
1. Increasing the rental return by modifying a suitable house into units.
2. Increase the rental return by providing fully furnished premises
3. A combination of 1 and 2.
My thoughts are locations near universities for students, hospitals for nurses, anywhere were there is a likely need for share accommmodation.
Furnishings are very inexpensive with a creative approach and a nose for bargain.
Has anyone tried these strategies? I can see some obvious pitfalls such as wear and tear costs, initial premium for properties in a likely areas. Any ideas or comments?
cheers,
Darren.good morning slatzagain, its great to see someone showing some initiative and trying to create an opportunity, in an increasingly difficult market, as opposed to complaining that you cannot find something in your first hour of net searching.
In relation to your points, I believe they have merit, especially about hospitals and staff.
In regional NSW the hospitals have difficulty in attracting Nurses and Doctors to work on a casual/as required basis. As suitable accomodation is not always available or does not meet the high standard required by Doctors, I am sure a market can be found.
It should also be noted that generally as part of the employment package accomodation costs are paid or subsidised by the hospital. This would result in some form of security for your investment.
No doubt someone already knows this and is doing it, but find a town that requires it and investigate it further, just give me 24 hours head start[
]BC
I just put an offer on a house in regional vitoria that meets the 11 sec sol. I am going to be offering the tenant dvd rentals vouchers as he has a couple of young boys, in order to sweeten the $5pw increase in rent that I will be making (assuming I get it). If his kids were younger I was going to put a swing set in teh back yard.
I recall Steve saying he has offered movie tickets, dinners, and I think a card that offered his tenants special discounts around town.
Cheers
Leigh KRead, learn, grow but most of all do it.
Thanks for the reply bc. I hadn’t thought of the accomodation allowances, that’s cetainly an upside.
Leigh – I certainly agree with the incentives idea. I read Steve’s book as well. Sounds like that can really put some icing on the cake. Great idea to really tailor it to your customers needs.
Good luck with your offer, and congrats for finding an opportunity!
cheers,
Darren.A quick comment on furnished vs. unfurnished: our rental agent advised not to furnish as her idea was that tenants who had their own furniture were less likely to move around as often.
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