Looking for thoughts.

Viewing 7 posts - 1 through 7 (of 7 total)

Ambo72_2
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@ambo72_2
Join Date: 2004
Post Count: 102
November 24, 2004 - 8:53 am
Hi all,
Today I inspected 2 houses on a subdivided block selling for a combined price of $185 000 negotiable and a combined rent of $300/wk.
They are rented by a charity organisation who then offer them to tennants for a reduced rent, and rental is gauranteed whether there is anyone in the houses or not.
My question/concerns are:
1. Worried that the tennants may not be the most desirable and trash the place. Although the agent said that the organisation was ammenable to fixing any damages.
2. Do you think it is a worth while investment i.e risk/return (gauranteed rent but having no say in who the tennants are).
Thanks for the input,
Ian
Mortgage Hunter
Participant
@mortgage-hunter
Join Date: 2003
Post Count: 3,781
November 24, 2004 - 9:20 am
What are the CG prospects?
Simon Macks
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Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Ambo72_2
Participant
@ambo72_2
Join Date: 2004
Post Count: 102
November 24, 2004 - 9:43 am
Hi MH. CG I’m assumming means capital gains? If that is the case, it’s not spectacular at the moment, but if we get more rain things may improve as this is a central west QLD town that has a lot of sheep and cattle.
thecrest
Participant
@thecrest
Join Date: 2004
Post Count: 992
November 25, 2004 - 2:42 pm
Hi Ian
The risk factor increases when the tenants are charity cases. Expect some damage. Ask your bank to check the financial capability of the charity organisation and ensure it is written into the agreement. How is the lease structured ? – is it a lease to the charity which allows them to sublease ? Make sure the charity is fully and immediately jointly and severally responsible for any damage and that the lease arrangement and the liability of the charity to pay all damages and your downtime costs will hold up in a tribunal. good luck.
cheers
thecrest
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imogiri17859
Member
@imogiri17859
Join Date: 2003
Post Count: 3
November 29, 2004 - 11:04 pm
Once had a nice 4-bedroom house in Mt Isa. Similar charity bought 2 house in the court. Tenants soon trashed the neighbourhood and we were lucky to sell for a capital gains of $1000
Peter
yack
Member
@yack
Join Date: 2003
Post Count: 1,206
November 30, 2004 - 12:06 am
Is that really the business you want to be in.
I am in the business of property investing for the following reasons;
1. Make capital gains
2. Add value over time (between tenancies) to the property to increase capital gains.
3. As capital gains arise so to does rental increases.
4. Have renters who maintain property and limit damage to natural wear and tear.
Personally I would not touch the property.
Terryw
Participant
@terryw
Join Date: 2001
Post Count: 16,213
November 30, 2004 - 6:44 am
It depends on the area. I would not buy based on rental yield alone.
Terryw
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