Block of flats purchase

Body Corporate & Property Manager are two different things. You can get a block of units on one title, which means that when you sell, they all go at the same time. It's the one structure. A body corporate is a committee of owners of the units in a block. If you strata title a block of units, they can be sold separately and will need a body corporate.....but if you hold all units in the block you don't need a body corporate, because you own them all.

 

No, not a lot of upkeep at all really. In fact less than having 6 x individual properties. If it's a block in one line you have ONE building insurance, not 6, same with rates. Yes, you do have 6 x LL insurance, due to 6 x tenancies. Many smaller blocks don't have power to common areas.

 

Sounds like something that I'd say

 

Well, yes, but I'm speaking from experience. Plus I hadn't read your post.

 

The land is what goes up in value so the more the better, the building goes down in value over time.

 

Just my experience too I’m still happy with my investments

 

i would say consideration for structuring this type of purchase is important. strata or one title beside this to me sounds a higher risk type investment and most likely a high cashflow investment. so benefit of negative gearing very limited.

so structuring via trust, or set up a company to buy so that you can distribute income effectively. also should anything go wrong you can detach it from yourself easily. i own 6 property and recently 1 tenant was a massive headache and i spent more time and money on this bad tenant than rest combined.

 

I don't buy property to 'negative gear'.

Ummm, you do know that everyone's situation is different, don't you? KISS is a very good technique as well. And bad tenants always take more effort than good ones, the best way to offset this is to use a decent PM, but the more time you invest for, and the more tenancies you have then the more of this you will see.

 

@K168 no idea where you got this idea but based on your post and comments of wanting it in 'upcoming areas' have you ever actually seen one for sale? I have never seen one unless we have differing views on whats an upcoming area. All the blocks of units ive see have always been well over market value (of individual units) as usually these can be further developed.

Have seen a few come up in regionals and what is I would definitely consider not being upcoming areas.

 

There can be some good deals in regional areas, but definately not upcoming areas.

 

Have seen a few over the years. Some seemed like bargains but could be potential headaches (building condition, potential Tennant pool) but depending on what they cost mean to you and your appetite for risk could end up being cash cow

Actually in saying that I do remember what I believe was a fire damaged ex doh studio apartment complex in Dundas (very close to Carlingford border) sell for 1.6-1.7 mil (might have been 32 small studios) around 2015. I dont know how bad the damage was but I do remember it was refurbed and rented out at 350pw. That was probably the only upcoming (well now its a high end) area opportunity

 

See, now something like that, was probably a good buy for the purchaser, if they could get the funds for it. Even better if it could be strata'd and sold off individually.

There was a large unit block in St Mary's probably around the same time that sold for more, I think. Same situation. Mostly studio's, but some 1 bedders in the mix. Block was refurbed, and individual units eventually all sold off.

 

Yes I have seen a block of 16 in a suburb I was looking to buy. I didn't think anymore of it at the time because that was not what I was looking for. I am now on the fence for this strategy.

 

We get various blocks of units come on market in Perth area. A lot of them are older and might not have been strata-d so can only be sold as a whole block

eg
https://www.realestate.com.au/property-unitblock-wa-rockingham-135735022
https://www.realestate.com.au/property-unitblock-wa-nollamara-132219070
https://www.realestate.com.au/property-unitblock-wa-como-136329038

 

Offers from 2m, how much is the land worth, any idea?

 

i haven’t done any investigation but it wouldn’t surprise me if land was around $2000 psqm in that area.

 

Who runs the BC on the strata title option? Im looking at some now but they have huge BC insurance fees.

 

There's usually a committee, but it all depends on how many units there are. We had a block of 4 that were strata titled. As we owned the whole block, we ran the BC.