Am trying to get my head “out of the clouds” about a possible cf+ in rural Vic i’v come across.
My concern is it’s out past the black stump,sort of thing.So,just looking for the experiences (not “hear say”,as that’s obvious) of people trying to rent properties out whoop-whoop??
My concern is mainly how to attract a good tenant if current one leaves.There is no local real est. agent or m/ment mob.
Also concerned about getting tradies out there…
Suggestions? Experiences?[grad]We nearly had a lemon, I think it was the day after settlement our existing tenant topped himself and we didn’t know for a good week or so. Then being a smallish town everyone knew of the event and we figured we wouldn’t be able to sell it or rent it.
Then we identified a niche rental market in teh town. Each year the town bring in insterstate and overseas doctors, teachers and nurses etc. These people used to higher rents and generally plan to stay for 2ish years. So long as our properties are in there best condition we could rent out the potential lemon to someone that didn’t know the background and also we can charge a higher than market rent on all our properties, because the people are prepared to pay a bit more for a good quality property.
We do have a rental manager in teh town – I should say a rent collector but at least we had that much.
Maybe you could meet a local tradesman or neighbour and offer a small fee in return for small jobs.
Cheers
Leigh K[biggrin]I am afraid to ask LeighK, topped himself, is that mean he hanged himself !!!!
We have a property in regional Vic. One issue I have is you don’t have a wide selection of tradesmen. We were going to paint the exterior of the house and build a small section of the house, but all the local painters were booked for the next 3 months. End up we had to ask this mature group (not Jim’s) to do the job. Guess what, we were really pissed at the workmanship and the inflated price. That guy quoted me $4800 for material & when the job was finished he could only account for just over $2000 of materials
The site was a mess and the workmanship was very poor. We complainted to the mature group they didn’t even bother to reply and acted if they were only a messenger service and it got nothing to do with them. My advice is never give any job to this mature group.lots of country towns have tradies but many of them small nit communiti and they charge heaps for jobs done thats if you can in to buy their first taht is!
i think sometimes its best to be ready to do lots of stuff youself othrwise it can cost more than yu make!Agree hotshot, at presenting getting tradespeople to do renov in regional town WA. It is costing alot more than expected as they are charging a fortune and know they can get away with it.
For example new ceiling in main bedroom, quote was $900, it should be around $600 tops. Not Happy.. Fortunately I got the IP for a steal so have to wear this one.
Cheersthats just it marisa!
you have to look at the hole pic but sometimes ppl forget that and thats when they end up losing money and its not just with country areas it can be oversees or intastate props to!DIY is definately the go. You may not be able to claim the work done but you’ll still be able to bump up the rent a little. If you’re not that way inclined, just start on the easy stuff or rope in a mate to help out (often only costs a couple of beers).
I have a rural IP & other than repeatedly having to ask the tennants to cut the grass (they didn’t want to go halves on gardener) even when a mower is supplied with the property, there have been no problems. Quite the opposite. I realise the the risks may be a bit higher rurally, but that is the way I’m going to keep going.Regards
Patrick
Oh Well. Good to see some reality about rural properties hitting the airwaves. I would love to hear from someone who has owned rural properties for over 5 years.
Has it been worth the hassles? How much postive cashflow from a rural property do you need to justify the time you need to put in? Thats the magic question?
Hi Yack
My rural IP is in the UK, so the situation is slightly different. I paid it off 3 yrs ago and whilst the loan was still running it was still giving me approx. 14%. Its a bit less now as I’m having a fair bit of work done to it (extending house, buying land to make block bigger etc). As I said in another post tonight, the only hassle is getting thr tennants to cut the grass!
It was the location that interested me, only 10mins to station & 50mins to London. Initial CoCR was awful but has paid off hugely since. [biggrin]Regards
Patrick
The dumbest question is the one you don’t ask.
We have owned an IP in a small town (pop 350) since 1999 and it has been nothing but a blessing. It has been vacant for about 3 weeks total and all tenants (except one who only lsated 6 months anyway) have been great. The situation has only been helped by our wonderful PM team. Since we bought it it has also more than doubled in value.
I know that we are very lucky though. It is our only IP and I figure that the more you own, the more likely it is that the lemon is going to turn up.
Cheers
Sonjasometimes the lemon isnt the building or the area.
I think the lemons are often the tenants or the PM.As for charges, it isn’t a bad idea to try and build up your networks asap in those towns. Yes you can get ripped, but I think it is how you present…. lets face it. You might not live in the town, but you do own a property, so you are part of the town and the community, you provide something within it, you might spend some of your income in the towns economy and you are adding value. Your money has come into the town in the first place, you might even improve the building, which might spur on others. What I am saying is, just because you dont live there, doesnt mean to say you have no say, or cannot be part of it, and the locals wont rip you off for too long, or even initially if you put it in the right context…gee you might be moving there in time…just not now?
always hard to break into the clicks of small towns, they can resent outsiders. So be positive, it might rub off.
elves
” a blind man may see what a sighted man may not”
Very interesting thoughts elves.
I have been considering sponsering one of the classes at the local Agricultural Show in the town where our IP is. I know that they (like many rural Ag shows) are struggling yo raise funds and get volunteers to keep the thing going. I would volunteer but the 5 hour drive is a bit prohibitive.
This was motivated mainly by my own vested interest in the Agricultural Shows. As a kid I spent many years chasing them around showing horses. I have many treasured memories of this and would like to see that the shows continue. Sine I was involved many have folded for various reasons.
The local Agricultural Show is a major social event for rural communities and it also draws tourist $$$. So there is my plug for the good old Ag Shows! How about visiting your IP when the town’s show is being held and take a look for yourself.
Cheers
SonjaI think it is too much of a gamble to buy an IP in a town of 350, just wondering how big the rental pool is. My criteria will be at least a population of 10,000, okay may be 5000 if the deal is very good.
We originally bought it at a PPOR but work transfer fell through. We then had trouble selling so we decided to rent it out. Just luck and coincidence really. Like I said the more times you tried to repeat it the more likely you are to get that lemon.
Cheers
SonjaAh yes, getting to know the townspeople helps. When renovating a PPOR in a rural town recently, the neighbour lent us a heater (as it was freezing), we gave her some left over guttering as she needed approx 1 meter.
She then found us a handyman when we hadn’t been able to. We gave her some leftover paint for her roof once we’d finsihed ours etc etc.
She couldn’t be more helpful and it has helped us break into the niche groups and get the tradespeople a bit quicker than our own attempts. It just took a bit of give and take to break in.
PK
Hi Misty
i used to live in Stawell (Vic) for about 7 years, i would be a bit concerned about some of the tiny Wimmera or Mallee towns. My strategy was to buy in towns over 5,000, but little towns like Nhill, Dimboola and so on have been good investments for those have bought there. Personally i wouldn’t be a buyer in the market today- but hey i don’t know how good your deal is, so don’t let my comment put you off.
PM me if you want to know about the particular area i maybe able to share some comments.
On the positive some small towns could be in areas that will benifit from things such as the Douglas Mineral sands project and the others in the Murray Basin.
regards westanI live in New Zealand and for a fee find cash positive deals there, email me at [email protected] to join our database
hi all.Westan,u hit the nail on the head,it is a mallee town.Perhaps u can shed some light on where/when this project is expected? There may be other readers that will benefit from this knowledge too![cap]
I wouldn:t touch it if there is no rental manager and no tradespeople.
I have properties in whoop whoop towns of a few thousand myself, and they are fine, there is more than one property manager to choose from and say 8 or 10 builders, two or three plimbing firms etc.
My returns are around 20 – 24 percent yield CASHFLOW not to mention capital gains as well. to cover the `risk` that the rest of the world tells me I have there. (hehe). Now if your whoop whoop returns aren`t pretty much up there either for cashflow or capital gains, then by the time you@ve solved all the problems, is it gonna be worth it???? you@d have to be getting twice as much as a term deposit from it, wouldn@t you, to bother???cheers-
Minijoy to the world
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