Any comments on “student accommodation” in the Auckland Central area. That is, studios. The rental return appears to be very good, better than normal.
I’m just starting out and trying to overcome the fear factor, so any advice is appreciated
Waz,
This is a high risk area.
These studios are being marketed to Australians with all sorts of promises of high returns and strong student demand.
The truth is that there is an oversupply of them in Auckland and in addition there are less international students studying in Auckland.
Do some searches of this site for some stories on this. Some experts believe there will be a dramatic price fall in the smaller apartments in Auckland soon.
All the best and don’t be discouraged. Perhaps you need to investigate what most investors are after and then the demand will always be there.
Cheers,
Simon Macks
Residential and Commercial Finance Broker
***NODOC @ 7.15% to 70% LVR***
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These and the apartment market in Auckland is likely to crash. Do not waste your money on second rate products. Most of these properties are owned by Australian investors. The New Zealanders have more sense. I recently purchased a house that had been divided into to flats returniing nearly 8%. The property will also have far more capital growth than student accommodation n Auckland
Nigel Kibel
http://www.propertyknowhow.com.au
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There is a school of thought that with the new planning guidelines which now specifies a minimum apartment size (40sqm for studio or 1 bed from memory) that over time there will be a robust market for these smaller student sized apartments as they will not be able to be replicated. They will always provide an entry point to living in the city.
If you are seriously looking at one of these units then make sure you get your own advice on what the expected rental returns are – at the right price almost everything is worth buying.
Also talk to your bank as I know a lot of lenders are only lending up to 60% on anything under 40sqm.
Best of luck
If you are considering any Auckland CBD apartment market purchase there has recently been a comprehensive report specifically on that market.
See the thread at https://www.propertyinvesting.com/forum/topic/20510.html“Make sure you can survive the downside, and the upside will take care of itself!” Donald Trump
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