as i said returns are high $600 a week rent for approx 40weeks a year rates $2500 body corps fees $4500 letting pool takes first weeks rent if new tenants are found there are 4 bedrooms all with toilet/shower $150per room p/w bought off the plans for $217500 5years ago now we can buy one for $199500 .Two questions why have they lost capital and what is the catch
1) Depreciation – new units have a developer's margin (profit) as well as GST recovery built into the price, they don't give them away. You would have to be extremely lucky to find a unit at the start of a boom/end of a downturn and hold for short time to make a profit.
2) This type of unit is hard to sell – it is the managers who make the money from these deals.
can be hard to finance too. Which will lead to less buyers.
Also there is a general decrease in property prices now.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Recently there is an agent recommending me a villa (6 rooms) right across a university here with a promise of $800 p/w rental (guaranteed for the first year). I turned it down because I suspect that the developer has already added the guaranteed rental into the purchase price. I suggest that you do more research into the area to see whether the other properties are comparable in price you are paying or not.
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