i am looking at buying a one bed room flat and then rent it out is their any thing i should watch out for,[8D]
There will be many. One that I don’t think many do is to speak to the Body Corporate Manager. Understand what works, maintenance, beautification are being looked at. More specifcally, the status of the sinking fund and possible upcoming one-off levies for that work.
Is car-park on title??
James
a car park is on the title and the body corp charge $220 a quarter i fill that is to much the rent is $105 a week and the unit is $105,000 [8D]
Have you seen the section 32. Is the levy just for Body Corporate rates?
The previous BC notice will confirm who the managers are – ring them and speak to them re sinking fund.
Based on figures it is ~5% gross. Determine other outgoings ie council/water rates, rental commission would be 7% probably, insurances, maintenance, mortgage payments and then determine net return. You may find it is prob. ~2.5-3.0%
You would need to be satisfied about longer term capital growth of suburb. What are other comparable sales for the area? Find that out and if you still want to buy, put in an unrealistic low offer, say $85-90k. You never know, the may be desparate to sell??
James
Buy one larger than 50sqmts and close to public transport … Phil
I am assuming (given car park is on title), that it is strata title. (preferable to stratum or company share)
James
$220 per quarter is probably not too much. These days,I see anything under $1000 per annum as reasonable. I doubt you´ll find any BC rates anywhere under $660 per year.
Also, it would be good if the property was built after 1985- there´ll be good depreciation benefits.
Any special features? Heating, bath, views etc?
kay henry
Don’t buy in blocks that are older than 20 years and younger than 2.
Remember this tip.
All the best to you
Bec
Can you explain the reasoning behind your tip please Rebecca?
Thanks,
Simon Macks
Mortgage Broker
http://www.mortgagehunter.com.au
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
$220 per 1/4 is fine..
How many units in complex..anything too large means more competition for your tenant base.. look for close to transport, shops, services etc.. things that will attract a tenant
Agree with speaking to BC re upcoming works due etc, how much $ in sinking fund…
lifts, swimming pools, on-site caretaker is a drain on funds..
how old is the property ? ( depreciation and possible maintainence issues )
mainly Owner occupier or rentals in complex..
and lastly.. do the sums !!
how much are you putting into the deal etc.. what is end yield.. are you – gearing, + gearing.. and why ??
REDWING“Money is a currency, like electricity and it requires momentum to make it Effective”
another thing with 1 beddy units. make sure there ISNT A PHONE BOX OUT THE FRONT. trust me on this. at 105 p/w the area is more than likely where the low income earners live. with a phone box out the front, theres yelling and fights etc at all hours of the night, cars were getting broken into and general mayhem as they congregated around the phone (i dont know why)
we ended up getting telstra to remove the phone box and havent had a problem with the place since.
just my 2 cents worth anyway
shaunLead, Follow or get out of the bloody way
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