University Properties

Viewing 5 posts - 1 through 5 (of 5 total)

RAC28H
Participant
@rac28h
Join Date: 2003
Post Count: 23
December 4, 2005 - 6:30 am
Hi All,
Has anyone ever purchased purpose built university unit properties ?
ie: 1 bedroom, small kitchen, bathroon
Im looking at investigating some purpose built properties, close to universities that cater mainly for students.
Any ideas appreciated.
Thanks
Rach
Tools
Participant
@tools
Join Date: 2003
Post Count: 363
December 4, 2005 - 8:11 am
I believe they are a good return,but no growth ,and are hard to sell.
Tools
learnshare
Member
@learnshare
Join Date: 2003
Post Count: 105
December 5, 2005 - 4:18 am
Please also check with your lender or broker first. Sometimes Lenders are fussy and uncertain when you mention student accomocations.
Chers,
herman’
mathewc73
Participant
@mathewc73
Join Date: 2005
Post Count: 241
December 5, 2005 - 6:23 am
Hi,
Also check the lease in detail to see how much control you have over tenants (if any) and how much control the lessee has in setting rates.
eg YMCA Melb will try and get in students for 6 month leases. Jan to Jun gets good results, then they reduce for rest of year if they cant get a student. You also cop the vacancy between semesters.
You need to take all this into consideration.
Mat
MarkyMark
Member
@markymark
Join Date: 2003
Post Count: 132
December 5, 2005 - 1:11 pm
I lived in one of these while at uni. They were really nice places and just perfect for me as a student. They have cleaners and where I stayed they had security and where strict. So the properties where kept in good condition.
You may want to ask about how they allocate which place is to be rented and when. I spent about 6 months in one of the best units by myself because they didnâ€™t have enough students to fill all the places. However, the whole complex was at about 90% capacity at the time.
I asked that they put someone in my unit at the very end when they were totally full (becuase I liked being by myself). They sort of verbally agreed to this as I was an excellent tenant and they were careful who they matched with who.
So what does this mean from an investors perspective? Well it means that the complex could be 90% full and you may still only be getting half your return or no return. However, it could be only 5% of capacity and you could have a full unit.
I personally would be concerned that I cant do anything about it. Its up to the onsite manager. Unless you have some guarantee or something??
I think the more control you have over ensuring that your investment makes money the better.
Cheers,
MarkyMark
Just my opinion.