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Damn it , our OTP just rented ...

Discussion in 'Property Management' started by See Change, 29th Aug, 2015.

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  1. See Change

    See Change Timing Lord Premium Member

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    Might sound a strange thing to say but ...

    Bought it two years ago in teneriffe . Gone up around 10 % since we bought it . The market wasn't that hot at that stage so it came with a rental guarantee . Ok , ok , I know , warning , wanting etc , but we were quite impressed by the quality of the builders work and it was deliberately marketed under market price so they could sell everything prior to starting the build.

    Our unit is on one corner , looking on to developers next project which has just started Once that's finished we think ours will be very private and quiet and have a nice outlook , but at the moment , being in close proximity to a building site , it was one of the last to rent .

    So what's the damn it moment ...

    The rental guarantee was paid by the builder , so no management fee was being taken out , so our " rent " was actually higher because of this . We would have been quite happy if it didn't rent until the adjacent building was finished , in a years time .

    Just received an email saying the building is 100 % rented " the management teams selective application process ensures that each apartment is now occupied by the highest calibre tenants including high income professionals and high profile celebrities such as TV journalists , top ten musicians and sports icons "

    Must admit I have mixed feelings about my unit being trashed by a top ten musician or sports icon . Maybe if they trash it , I can get their autograph :eek:

    Cliff
     
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  2. pugstar205

    pugstar205 Well-Known Member

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    I'd like everyone to join me in a minutes silence for See Change's luxuary apartment in Teneriffe that has now rented. :)
     
  3. Redwing

    Redwing Well-Known Member

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    Just goes to show how many people go OTP ;)
     
  4. See Change

    See Change Timing Lord Premium Member

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    Thank you for your condolences ...:rolleyes: .....o_O

    cliff
     
  5. Redwing

    Redwing Well-Known Member

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    Ssshhhhhh..... ;)
     
  6. See Change

    See Change Timing Lord Premium Member

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    Our first one , and probably only .

    It was an opportunity which we thought was worthwhile and it has been , but In reality we would have done as well if not better if we'd bought three houses in Logan , but we're doing the equivalent of that now anyway

    Cliff
     
  7. Hodor

    Hodor Well-Known Member

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    First world problems.
     
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  8. pugstar205

    pugstar205 Well-Known Member

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    How does the rent guarantee work? Do they guarantee the rent until you get the first tenant then it's considered honoured, or for a period of time after completion (e.g. no vacancy for 12 months)?
     
  9. devank

    devank Look, lets just get on with this, ok? Premium Member

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    You add the rental guarantee amount to the sales price ;)
     
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  10. See Change

    See Change Timing Lord Premium Member

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    Considering the sale price was around 50 k under market valuation I can live with that . That was my estimate before we went up to see the property . The James in Helen St .

    We spent about two hours with the developer , Damien Cavallucci ( not a " salesman " though he was a very good salesman :) ) of cavcorp . We had a look around Como which was the development they had just finished and teneriffe . During the " conversation " he mentioned that they were deliberately pricing them 50 k below market value so they sold 100 % prior to breaking round , so that gelled with my thoughts . He said this was a technique Mirvac used when they started .

    I had a look at their latest project and noted that they were being sold at market value .

    We ran the project past our long term Brisbane solicitor who said they were a high profile , well respected Brisbane family . His brother was the local member prior to the last q'land election. Doesn't hurt .

    Cliff
     
  11. devank

    devank Look, lets just get on with this, ok? Premium Member

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    I wasn't really questioning your purchase See Change.
    I was responding to pugstar205 without thinking about the relevance to the OP.
     
  12. See Change

    See Change Timing Lord Premium Member

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    No problems mate . I hadn't posted details about the specific property and was wondering about the wisdom of doing it as it might encourage other people to buy OTP close to the CBD which looks as though it's going to go into oversupply

    As a general rule I'm not enthusiastic about OTP , but if the timing is right and the deal is good ( which we felt it was ) there is a place for it
    .
    As I already suggested , we would have done as well , if not better with cheapies in Logan .

    It's a small % of our portfolio , and gives a bit of diversity . At this stage not sure if we will keep it long or maybe sell it if it goes up a lot in the current cycle . Gross return is close to 6% which is good for a centrally located property which suggests there is room for a reasonable price increase.

    Cliff