VIC University Housing with High Rentals - Notting Hill, VIC

Discussion in 'Where to Buy' started by virhlpool, 27th Feb, 2017.

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  1. virhlpool

    virhlpool Well-Known Member

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    virhlpool, 27th Feb, 2017
    #1
  2. JacM

    JacM VIC Buyer's Agent - Melbourne, Geelong, Ballarat Business Member

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    Hi @virhlpool

    One to be careful of is whether or not you can finance it. Lenders don't like things that are less than 50m2. Check with your broker first.
     
    JacM, 27th Feb, 2017
    #2
  3. Corey Batt

    Corey Batt Well-Known Member

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    Significant finance restrictions - in terms of many lenders not willing to touch them at all, or at greatly reduced LVR's.

    There's a reason why the yields are high, because no one wants them and the values are goign nowhere, so you're sacrificing any growth for these kinds of B-Grade investments.

    When there's millions of A-Grade properties in Australia, you have to ask yourself why you would consider subpar investments.
     
    Corey Batt, 27th Feb, 2017
    #3
  4. seema

    seema New Member

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    What about buying something like this from SMSF without any mortgage? Is it still that bad?
     
    seema, 27th Feb, 2017
    #4
  5. The Y-man

    The Y-man Moderator Staff Member

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    It's not "bad" per se - but you need to compare apples with apples. So in this case, you can't compare with resi real estate - it is closer to a commercial deal. Basically you have a unit that is leased to an accommodation company on commercial terms (NOT resi). Thus you need to ask questions related to Commercial props eg what is the term of lease, any increase in rent built in, what if the accommo company goes bust, etc

    The Y-man
     
    The Y-man, 27th Feb, 2017
    #5
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  6. JacM

    JacM VIC Buyer's Agent - Melbourne, Geelong, Ballarat Business Member

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    Keep in mind you might need to sell it one day, and there are a limited pool of cash buyers keen on such dwelling types. Wouldn't want to be left holding a hot potato if you needed to liquidate an asset.
     
    JacM, 27th Feb, 2017
    #6
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