High Yield in Surfers - Whats the catch

28/69-73 Ferny Avenue, Surfers Paradise, Qld 4217
https://www.realestate.com.au/property-house-qld-surfers+paradise-134812982

2/1/1 apartment for $238k, rented out at 450pw.

Seems like a good investment for yield, in a popular location. Unsure about the strata but don't imagine it would be so high its a deal killer. Whats the catch?

 

Mix of holiday rentals in there.
Why anyone would pay $450 per week to rent there is beyond my comprehension, much better options for that money, but if they are, great for the owner. Would be interested to see the body corp fees

 

I'd say this too.

 

Deduct all your costs:

Rates
Water
Management Fees/Cleaning
Strata fees
Internal maintenance and refurb costs

Then see what's left Might be $200 per week IF you're lucky.

Not much growth there unless a developer comes along and want's to buy the building.

 

Could be a lot of reasons, is it a serviced appartment or similar? The yields on serviced appartments are rarely as good as they initially look.

$235k seems very cheap for the Gold Coast. Rental income and property value aren't always directly linked. Perhaps the catch is it won't go up in value?

 

What you posted no

There are meh/rundown apartments on peninsula drive which are only 2 storey and zoned for high rises. I havent looked at it lately but in 2016 etc it was possible to get one around 250k which rented for 350pw and had potential to be purchased by a developer. I was renting on this st and the guy below me had a contract for 450k pending the entire complex was sold

 

Thanks guys, the serviced apartment theory certainly makes sense. Cheers