Hi All
What do you think of the NRAS investment schemes available currently. I was looking for a company that would run one in SA but can only find them in QLD, TAS, NSW and WA. Tenant income seems in a good range to not end up as a disadvantaged area, and can find some that only charge a 9% management fee. They can change a new property from negative to about nuetral. Anyone else looking?, Got any pointers on what to be careful with.
Kane
Hi Kane
I also cannot find much in SA
I have a home that is brand new and hasnt been tenanted yet and I was wondering if individuals can join in with larger groups to gain the benefit of NRAS
If so
Where do I start
Thanks
DeeHi Dee
The winners of Round 2 of the NRAS submissions are meant to be announced mid this month. Hopefully there are some investment companies involved in SA. If there is larger group allows people to bring there own properties in they will charge a fee for the managing the NRAS component and the tenacity management. The property also has to meet certain criteria in regards to location and building standards.
Regards
KaneOne thing that put me off a little was that I read somewhere that the property, if sold within the 10 years has to be onsold to an invester that takes it over as an investment in the NRAS scheme. I dont know if Id want to limit myself if for some reason I had to sell. There is a NRAS Hotline 1800 334 505
DeeLast week we were sent an email by Cameron Bird group re an NRAS apartment in Qld. We put in an expression of interest on a particular apartment that night . We sent them a form with all our details. They acknowledged our form that night. We then found out a couple of days later that apt had been taken and wed have to buy a dearer one.
We said forget it as we wanted the one at the price quoted by C B group and as it turned out its not such a great investment after all.
Hi All
NRAS is a good idea by the government but make sure you check out all the tax benefits and the holding cost to you.
As one contributor stated if you want out before ten years you may have some heart ache.
Also remember that if the rental is stated at 350 per week you have to carry 20% of this for the next year, you cannot get it back (as I understand it) via the ITWV form!
The other situation to consider, is that a large amount of this stock is being sold in apartment blocks and then rented.
Experience shows that a complex 100% rented will not gain the capital growth you could expect from say a duplex or stand alone home or maybe a unit in a complex with a mix of OO and rentals.
Even stock like I have at Chinchilla would show a better capital growth in my books.
Research you purchase long and hard.Bluegrass
Hello all I don't this scheme at all,
The investor has to offer the property at a discounted price off a valued rent and then "negative gear" the short fall for the year then HOPEFULLY the government will pay the $8,000.00 quickly so lots of cash flow issues here.
This smells like housing commission to me because you are renting the properties to people who are desperate and probably will not look after the property … no thanks.
The properties are located in crap areas with terrible growth and toooooooo far away from bus, train, westfield, hospitals, schools etc … once again no thanks.
This will end up being another sub prime mess … HELLO where is the $8,000.00 coming from TAX PAYERS yes u and me … once again no thanks.
If it looks to good and sounds too good it's no bl..dy good in my books … so keep this on record and lets see where this goes … oh and as stated above what happens if you HAVE TO sell it before the 10 year period.
D
www.fahcsia.gov.au/sa/housing/progserv/…/nras/…/default.aspx
Hi wealth4life
I got interested in this scheme because the the government payment makes some of the properties cash positive. You still get to choose your tenants. They don't need to be unemployed to be able to rent the property. Single person can earn up to 50K and a couple with kids up to 86K.
Would stay away form developments with a large number or all their properties in this scheme. It's the same as any other investment you have to looks to see if it meets you criteria ( area , price, fees, amenities).You can sell within the 10 year period but it needs to stay in the scheme or another property used in its place. The defense housing seem to sell with long term contracts still in place these should be able to as well. Planning to keep for 10 years anyway
Kane
Hi Kane
First up the defence houses are totally different to the NRAS.
They are rented by the Defence Force and used for personal.
The NRAS concept while needed is under siege from opportunists.
Granted you get the $8,000 at some time and the benefits of depreciation, but do you want to put yourself or your clients in a situation where the capital growth will be almost nil?
As wealth4life stated 'This will end up being another sub prime mess…….' I could not agree more!
There are so many great investments out in the market place that surpass this stuff like they are standing still!Bluegrass
Bluegrass I totally agree with you …
This government is getting into more debt by supporting and investing in such schemes …
Why doesn't the government teach people how to save from an early age instead of spending tax payers money to support people who can't save … this is housing commission gone wrong.
Wallace D'Wattles wrote a book in 1904 called "the science of getting rich" and in that book he said – the worse thing you can do is give money to poverty or poor people because it will keep them poor and the greatest thing you can do is teach poverty how to make money then they will believe it is possible … (the book is free in google search … )
Labor governments invest in poverty that is why we have gone from "credit" to 200 billion in debt …
aaaaaahhhhhhhhhhh
D
the nras homes in tassie ive seen are first rate quality close to services and offering 7% plus returns. I dont know about other states but I think the opportunity of getting a guarantee from the govt in return for giving up 20% of rent is a no brainer.
Hi, there were some numbers bandied about re Tassie NRAS properties. $280 thousand house rented for $407 pw. Hello, how is that possible? Can someone check the median rents in Hobart and Launceston? It smells like a RORT.
Ten years is a long time. Suppose the govt that guarantees the scheme gets voted out & the next govt says it's not me, it's …, then what?
KY
Yes once again the money that the government is giving this scheme is coming out of tax revenue and that tells me there is a bigger problem coming in the future.
What I really can’t figure out is that Australian tax payers are happy for the government to be doing this … it is like allowing people to dip into yours savings account and you think that is OK ??
Financial intelligence must be taught in schools from age 7 for these problems not to occur in the future.
Philip Sigglekow
Unfortunately whether we agree or not the Govt has already decided to use tax payer money to make rental housing more affordable to low to middle class Australians. We can debate forever whether a future govt might or might not remove the subsidy.
The real issue is something has to be done, the Govt thinks ( rightly or wrongly) this will assist and obviously it will assist tenants at least for the next 10 years. ( or until the incentive is withdrawn!!)The homes I saw in Tas were "normal homes" rented to normal people in normal suburbs, could just be the model works better in Tas due to lower capital values and lower wages there makes for higher calibre of people capable of being eligibile.
Gross return of 7.5% on $250k pp on brand new home with a 10 year subsidy from Govt is not going to make me do cartwheels in the street but for the reasons above looks better to me than what else Ive seen.
I guess it all comes down to what our beliefs are.
BTW I think learning financial intelligence and stop giving money to the poor is a MUST!!!
I have decided to go ahead with the NRAS property in Taz and I am currently just waiting for the bank valuation to come back for finance. I was looking at doing a new build anyway so the government rebate just helps make the property more attractive. If the scheme gets canceled by a future government then the rent goes back up to the market value or i can sell it with no conditions in place. Looked long and hard at a lot of scheme's and decided this property was the best for me.
As i have said before i can see some of the developements having problems later because of the large number of properties dedicated to just this scheme, if not all. I much prefer where they make up a small percentage in a large developement.
KY made comments about the figures $280 thousand house rented for $407 pw. The maket rent would be around $300 pw, take 20% discount = $240 is what the property will be marketed for and then add the government rebate currently about $167pw so you get your 407pw.
Check out these guys, they are in SA and do NRAS, they seem to have a different set-up and your don't seemed to be locked in so much as others, you own the property and can sell to whomever,whenever…
Hi Chillbaby
Thank you for that info. Currently waiting on finance for property in TAZ, if that falls through I'll give them a ring. Have had contact with them before on a another property in andrews farm in adelaide and they where good to work with.
Kane
If you want any additional information on NRAS, feel free to check out http://www.NRASScheme.com.au.
With expert speakers on their free webinars they can answer any queries you may have.
Try this link to get more info on NRAS
http://www.nrasscheme.com.auenjoy
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