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Serviced apartments?

Discussion in 'Property Management' started by AdamPineapples, 10th Aug, 2016.

  1. AdamPineapples

    AdamPineapples Well-Known Member

    Joined:
    9th Sep, 2015
    Posts:
    57
    Location:
    Melbourne
    I discovered services corporate apartments the other day. Company's like Corporate Keys rent them out. My question is what's the difference between that and traditional leases? I understand the obvious differences, like utilities and furniture is provided. But besides that, what else is different. Like contractually. Because on their website they other day rates like a hotel but then they advertise on real estate websites for a weekly rental fee?
    My other question is why would this company do this? What money is their to made to rent out serviced apartments? And why would an owner go their?

    I also noticed that Corporate Keys has a lot of apartments from the Eureka tower listed.
    This is something else that puzzles me. Because for a building that's the biggest residential building in the Southern Hemisphere. I can barely find any listings for it. No sales listings and about 4 or 5 rent listings which are done by Corporate Keys.
     
  2. hash_investor

    hash_investor Well-Known Member

    Joined:
    11th Oct, 2015
    Posts:
    912
    Location:
    Sydney / Canberra
    Serviced apartments provide guaranteed rental return to the owner. Companies like Corporate Keys pay monthly rent to the owner and charge short term corporate rates from the tenants. The difference is theirs to keep.

    A lot has been said about serviced apartments here on the forum. Some people are making great cash flow from it. A simple search will reveal everything.
     
  3. D.T.

    D.T. Adelaide Property Manager Business Member

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    13th Jun, 2015
    Posts:
    5,595
    Location:
    Adelaide, SA
    Serviced apartments?
    Short answer no
    Long answer noooooooooo
     
  4. AdamPineapples

    AdamPineapples Well-Known Member

    Joined:
    9th Sep, 2015
    Posts:
    57
    Location:
    Melbourne
    Haha why is that??
     
  5. Colin Rice

    Colin Rice Mortgage Broker Australia Wide Business Member

    Joined:
    9th Jul, 2015
    Posts:
    1,078
    Location:
    Perth
    Lenders dont like them as they are considered "short term" accomodation and as a result LVRs are often limited to 70%.

    The resale market is small as well so thats why they seem cheap.

    Did one with ANZ via a desktop val so got it through no probs at 80%.