Hi all, thanks for the informative site. Just a few questions about buying a house near uni in Wodonga and renting it out to Uni students on a per room basis.
Using Jaffasoft cashflow calculator the numbers come out like this:
assuming $190,000 purchase price, for 4br home with no money to be spent on it.
Renting to students per room @$100/week including utility costs (i have allowed $2000)
8 weeks vacancy = -29.24/week
4 weeks vacancy = -1.30/week
2 weeks vacancy = +12.67/week@ $110 per student/room
8 weeks vacancy = -13.81/week
4 weeks vacancy = +15.49/week
2 weeks vacancy = +30.19/weekWhat do you guys think?
The house is going to auction this Saturday!!!
So we have some major decisions, we will have to put ALL our savings into this just to get into the deal and that is only with a 5% deposit[blink]
So we are feeling very uncertain, we can see how this could be a great thing if it worked, but also know how complex it could get.
Any constructive comments would be really helpful, especially from thise who have been there
Thanks alotcollie
HELLO!!!
Does anyone have any comment pleeeeeeeeeeeease?
Thankscollie
I would first talk to the Uni (and RE Agents) about the accomidation situation. Also find out the average rents and think about how you can handle vacancies (esp. over the Christmas break).
Also collecting rents can be difficult, very difficult, as well as maintanance. A lady called Marleen Geyen has made it a particular successful niche. So check out: http://www.universitywealth.com/ for help.
You can email Marleen (I think all her properties are student rentals), and I’m sure she would be able to help you out.
Rgds.
Lucifer_auBe careful. If you rent more than 3 bedrooms in a property, then you become a “rooming house”, under the residential tenancies act (victoria anyway) and a whole heap of extra rules.
Also I know in some areas, that if you have more than 4 people living in the house than you come under a new set of council conditions called “prescribed accomodation” which can include things like requirements for health inspector checks and more.
And check insurance… i asked for an insurance quote on a share house and couldn’t get anything under $10,000 p.a. (no typo, thats $10,000). Good luck on claims if you don’t disclose this info and just get standard IP insurance.
I reccommend local legal advice, dangerous waters.If you go through, approach the local universities off-campus accomodation officer, develop a good relationship and be genuine, they don’t take too kindly to people that come across as trying to rip poor struggling students out of their measly pennies, as many have tried to before.
Remember uni holidays go for 3 months, so be aware of this for your vacancy rates.
You will also have 3 times as many tenant problems and have to find new tenants regularly.
Under law you have to include the gas and electricity in the rent unless you have an individual meter per room.
Think about how (if) you will furnish rooms. More money and time.
Good luck.
p.s. do a search for “uni accommodation”, there are heaps and heaps of posts on the topic.
Live, Learn and GrowLifexperience
oh, and my electricity bills for a 3 bedroom house with students was $1200 for 3 months over winter.
I also made the mistake of living two hours away from the properties………i lost a lot of time and money travelling.
Live, Learn and GrowLifexperience
thanks everyone for taking the time to reply and share your thoughts.[biggrin] We have decided as this is our first property venture that we will not go ahead with the uni house idea. I think it will be just a bit complex for our first go, also having trouble with obtaining finance and thinking that $105/week for a student is pretty steep especially in a regional area, but his is what we would have to charge to make things a bit less of a squeeze. So back the drawing board.
Yes i did research the idea as well, such as ringing accom register at the regions uni’s finding out demand that sort of thing, also rang tenancy board and they said that 4 people in a house is not going to add any sort of extra rules,(VIC).
Anyway thanks again, appreciate your comments and links to visit.
TAcollie
Good on you collie for taking the time to review the deal properly.
The other point I was going to add was;
Check other 4 bedroom houses in the area. Whilst $100 per room might not sound like much, if there are other 4 bedroom houses renting for less than $400/wk, you are not going to get many tenants other than those who can’t do math [biggrin]Regards,
Clint
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