NSW Homebush Completed property

Hi

newbie here

I am purchasing a completed brand new unit in Homebush. the property is tenanted and I got offered 3 years rental guarantee for 5%
So purchase price: $440k with $420/week rental for 3 years

Its a studio apartment (advertised as 1 bedroom as the it has door and window)

Do you think this is a good property?

Sorry if its the wrong topic and wrong place

 

If it's such a good deal why do they have to provide a rental guarantee? Doesn't mean it's bad per se but makes you wonder.
Funding for these style of apartments can be tricky depending on overall size

 

I dont think its a good deal without the rental guarantee. however with the rental guarante, i feel like it becomes a good deal.

 

80%

 

If it doesn’t work without the rental guarantee than I think that answers your question. Guarantee is only as good as the one giving it. What happens after the guarantee ends and the rental price collapses?

 

Are you saying that any property that offers rental guarantee means they are no good deal?

thanks

 

So in 3 years time... it's a bad investment?

Think about WHY they need to offer a rental guarantee, if it was such a good location and rental price they wouldn't need to offer this just to get you to buy it, in my opinion.

 

Have you read about all the issues with the new builds, particularly in and around Homebush?
Did you know that there are over 3,000 units in and around Homebush set to be built within the next 5 years?
How do you think the rental will perform after the rental guarantee is finished with 1000s o\f units competing with you for renters?
Have you factored in a significant rise in the strata fees over the first 5 years within your numbers?

I wouldn't touch it at half that price

Stick with a 3 storey, double brick walkup with limited number of units, no pool, no lift and on decent land

 

Amazes me that there are people still buying these things

 

You've paid for the 5% guarantee for 3 years by overpaying for the apartment by 15%.

You think the developer is just giving money away for free?

 

I am so happy for you that you were able to post here before buying. Listen to these people...

JUST DONT. For that pricepoint $440k I would look for a nice deco apartment in a low density like maybe Campsie near the station? Will work much much better than that unit you are eyeing.

 

Have a look online and see what the rental would be worth without the guarantee. If they are offering you $50pw above market rent, that $7,800 over 3 years has to come from somewhere. Either you are overpaying or no one else wants to buy it or the real returns would turn people away.

 

On face value seems like a good deal

Reality is how big is the apartment and location (near the station or quiet far like DFO etc)