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seniors rental - big returns, what's the catch??

Discussion in 'General Property Chat' started by ozdrjohn, 13th Feb, 2016.

  1. ozdrjohn

    ozdrjohn Member

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    nsw
    hi everyone (and remember i am still a newbie here with only 1 day's experience on this site!). am seeing some amazing returns from seniors rental accom (see 51 & 52/1 Wellington Street Brassall Qld 4305 - Unit for Sale #106790059 - realestate.com.au). can anyone shed light on the reasons for such high returns, and also what are the 'traps for young players' looking at this space? for someone looking to build income replacement these seem like gold, however such high returns also mean potentially a much different risk profile. i welcome any thoughts on this. thanks in advance, john
     
  2. HUGH72

    HUGH72 Well-Known Member

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    I've only considered them briefly, but...
    Banks don't like them so lower LVRs required, limited resale market and capital growth although income might be okay which is what you are after.
    Watch management fees as well. What happens if it's poorly managed, you cannot change manager.
     
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  3. Cactus

    Cactus Well-Known Member

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    If the LVR requirements are different then you can probably deliver the same cash on cash return with a small cosmetic Reno. Before you even consider capital growth.
     
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  4. legallyblonde

    legallyblonde Well-Known Member

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    I agree that the major limitation is that your resale market is really limited... So your changes of CG are significantly reduced.
     
  5. Coota9

    Coota9 Well-Known Member Premium Member

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    I was going to say tenant turn over!!:D:D:D:D
     
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  6. Scott No Mates

    Scott No Mates Well-Known Member

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    If your mum was cruisin this site Coota, she'd turn over in her grave ;)
     
  7. Coota9

    Coota9 Well-Known Member Premium Member

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    My mum, god love her doesn't know how to work that "dam interweb"