Buying a Holiday Property for Income Generation (Port Douglas)

Hi

We are thinking of buying a holiday apartment in a resort facility with low-medium strata rates in Port Douglas (but also open to other, more profitable locations) and before starting to do some extensive research wanted to hear others’ stories of doing something similar.

It looks very attractive following my brief calculations:

- $200 - $250K apartment with 20% deposit

- $120 - $140 per day in low season

- $160 - $200per day in high season

- 20% strata fees

- 10 – 15%% managing and leasing costs

- 30% vacancy rate, however I work in tourism marketing, so am determined to bring this is low as possible.

- This way the property could pay itself of in a few years.

Could somebody please give me some feedback on the accuracy of my calculations as well as point me to any other variables that I might have missed? Any success stories of doing something similar would also be appreciated.

Thank you

 

Will a lender lend for this property ? eg Does it have a kitchen ? etc....Some resort accom isnt eligible for mass market finance as its not eligible to be used for a residential tenancy if the venture ceases.

You didnt mention insurance ? That coast is littered with resorts destroyed in storms that couldnt rebuild or access any insurance. Mainland and islands. You could buy a property that gets destroyed, wipes out the operator and you are left with ????
Paradise lost: Inside Australia’s abandoned resort islands

Is the rental rate what they pay you or the value you get after the GST is excluded but before their resort fees and admin ?

If its a managed resort how can you influence the resort rental ? Its not like you can tell them to rent out your unit. Any bookings you make may be allocated to a pool eg someone elses unit

 

.....by doing what exactly?

 

You mention '20% strata fees'. 20% of what? What are the strata fees in dollars per year?
I can't see cleaning fees there. They are typically high and often people don't find out about them till later. They will not be included in the management percentage.
30% vacancy rate is very optimistic.