QLD How do you assess market demand?

Discussion in 'Property Analysis' started by mr_alex, 1st Sep, 2020.

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  1. mr_alex

    mr_alex Well-Known Member

    Joined:
    28th Jan, 2017
    Posts:
    227
    Location:
    Gold Coast
    I'm looking at the idea of building some studio unit style accommodation but as a sharehouse arrangement. Either by converting an existing property or building new. Each unit would be atleast 25-35sqm +, own kitchenette, bathroom and access to private back yard area. And shared main kitchen and laundry with 3-4 other units.

    Where would you begin to look at if something like this would work in an area? Would I start by looking at the demand for units and studio apartments? Or rooming accommodation? How would I find recently rented similar properties? Thank you for any advice
     
  2. segue

    segue Member

    Joined:
    18th Mar, 2019
    Posts:
    18
    Location:
    Melbourne
    if i am looking for comparable, I would normally search in domain, with filter of 5+ bedrooms or more.
    599 Properties Sold & Auction Results in Dandenong, VIC, 3175 | Domain
    If I am more serious I will look for a list of approved rooming house within the council. Then search it one by one in google. Put it in excel and then compare everything.

    Normally inside the ad you'll see agent talking about returns, yield and if I am valuing the properties I will also compare the weekly rent per room. For example, for the following listing,
    2 & 4 Ebdale Street, Frankston VIC 3199 | Domain
    If the return is not listed in the ad, I would phone the agent and ask about the return, vacancy rate and redevelopment potential...etc.

    if this one is rented for $150 p/w per room, my brand new studio should be able to rent in a higher rate. If I am able to find some similar studio rooming accommodation, my rent per room should be similar. And my studio with shared kitchen shouldn't rent higher than studio with independent amenities. After doing this research I will understand where is my marketing positioning and my likely rent per room.

    And then I will move on and plug in the figure of my returns and list out all the expenses. At that point I will have a general idea of whether it is a good deal.

    Bear in mind, in some places rooming house need licensing. I would check the requirements as well if I want to do one. And I will make sure I am in contact with insurance companies to see if their landlord insurances cover rooming house.
     
  3. mr_alex

    mr_alex Well-Known Member

    Joined:
    28th Jan, 2017
    Posts:
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    Location:
    Gold Coast
    Thanks segue, I will be working with a builder and certifier so will all be above board.

    First time browsing on flatmates, I didn't realise you can search for residents as well as rooms.
    This seems like a really good way to sus out demand, I've compared different suburbs and some show 1 page of ppl wanting accommodation, other suburbs show 3,4 pages.

    Is there a website that shows recently rented? I can only find recently sold. Cheers
     
  4. segue

    segue Member

    Joined:
    18th Mar, 2019
    Posts:
    18
    Location:
    Melbourne
    Sorry, I personally don't know any website that shows recently rent properties. But if you could find one please let me know, that would be a great tool.

    Flatmates is a great one. I remember using it a few times when I was in uni travelling around different states. Back in the days I don't think people would even negotiate the asking rent. So the asking rent would most likely be the leased rent. Although now I see some residential listings with discount or rent free period so it might not be the case anymore.

    I agree this is very important to get to the bottom of the market demand and the asking rent. I would call the relevant agents who knows more about the market of this sector and ask about what they think. Most of the time they are happy to help.
     
  5. datto

    datto Well-Known Member

    Joined:
    23rd Jun, 2015
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    6,675
    Location:
    Mt Druuiitt
    Check realestate.com etc for comparables

    Speak to agents.