We have found a fair few positively geared retirement units, has any one had any experience with these type of properties befor and any advice would be appreciated.
hi pearl81,
Welcome to the forum.
I had looked at the opportunity sometime last year but dropped the idea due to the following reasons:
* Limited capital growth
* Low LVR (around 65%-70%)
* You cannot add value to the property because you cannot do anything with the investment. The only option is to lease it to the retirment village management
* The gross yield appears good but usually there are a number of expenses (sinking fund, body corporate, management fees, etc) that eats into the yield. The net yields are usually not as good.
Hope this helps.Also lenders will not readily lend to you for a retirement property.
This is due to the fact that if you can't repay the loan the lender is restricted as to who they can on sell your property to.
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