whilst searching for properties in Melbourne, I stumbled across many student apartments offering 7 to 12% return with ongoing tenancy for 5 years and managed by an organisation such as the YMCA or uni col.
Is there anything one needs to watch out for with these investments, ans why are there so many posted in realestate.com. surely if they were that brilliant wouldnt everyone be snapping them up
Untrusting
showersinger[angry2]
DAB
Showersinger,
Check out whether it has a rental guarantee (in which case its usually loaded into the developers price) and also the size of the unit. Its a lot harder to get finance for units under 50 m sq and some student accom can be as small as 18-20 m sq.
Cheers
DannyThey can be hard to finance and management fees etc. that are usually involved can be a hindrance to cashflow to say the least…
I think that when you buy properties you must have an exit strategy. If market is oversaturated, it could be hard when it comes to sell. I think in this market it’s important for a property to have a unique selling point. Buying an apartment of this type may be okay if it was unique in some way (eg only one with wheelchair access).
I’m also yet to see one of these apartments that are cash flow +, normally there are high management fees, rates etc, like G7 pointed out.
Be very careful if advertised as inner city, high capital gain etc! Steve’s recent post reinforces the danger of buying an inner city apartments.
https://www.propertyinvesting.com/forum/topic/18536.html
You’re far better off concentrating on average/emerging suburbs, with high growth potential.
Anyway, just my opinion and observations [biggrin]
Newbie
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