what is wrong with guaranteed rental?
reading formum replies a comment was as “bad as guaranteed rentals”.I have come across 2 units near the brisbane river. both come very close to Steve’s eleven second equation prior to negotiation which at least the agent is willing to do. current lease is 3 years 2.5 remaining, may possible to extend a further 3 years.
currently returning 8% waiting for figures to determine whether net or gross
breakingout,
There are at least two reasons why guaranteed rentals are usually no good.
1. The rental is already built into the purchase price (even if it does come close to the 11-second rule).
2. It’s likely that you will find it hard to get tenants at the “guaranteed rent” level once the guarantee period expires.
Why wouldnt the owner rent it out themselves if they could achieve close to +cf? Perhaps they need to sell, perhaps they dont…
Hope this helps,
Steve.“Knowledge is Power”
many thanks – “looks to good to be good” rides again
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