QLD Who said you can't find 7.5% yield in Logan anymore

Come on. I'm no expert in town planning. I basically follow your posts to get those town planning and zoning info.

 

or Bob lives in Richville

 

In Bob's dreams

 

@cherubym that is awesome mate! thrilled for you. well done for doing your research and picking up on the right opportunity. sounds like a solid deal!

congrats again! looking forward to hearing about more this year

 

Your Latest Purchase

This is your 3rd one in Logan to date? such a silent achiever...

Not your average cookie cutter purchase as well too...

750m2 - Woodridge townhouse zoned
6% yield to hold now and develop townhouse in few years time ( my calculation you can do 4x2bed or 3x3bed townhouse)

800m2 - Crestmead
7.5% for a great suburb in Crestmead with option to put granny flat.

And I thought I was the only one buying in Logan

 

Yes, this is the 3rd one in Logan. How can I become a loud achiever?

The other Crestmead one is actually returning 6.5%, as we over-estimated the rent and the condition is not even as good as this Crestmead one.

Although I want to buy more in Logan, the budget for my next purchase will be limited to $200K-$250K. So I'll have to look at other areas.

 

I am assuming that as long as the place is not advertised for rental with the utility rooms as 'bedrooms' that its not really an insurance issue?
Cannot do separate lease with non-legal-height-downstairs dwellings but if the tenants have family sleeping down there...
Or could insurance argue that the lease named more occupants than what would be expected for the legal size bedrooms (although people do share bedrooms) Or that property inspections would have revealed this being used as habitable space.
Interesting. @RPI what are your thoughts?

 

I don't know how the southside agents market these properties but houses on the Northside on the outer fringes with rumpus/utility rooms set up as bedrooms definitely attract higher rent. They just are never advertised as bedrooms and are never on a separate lease.
That is still a big rent though. The median rent for a legal (full height and advertised as a genuine bedroom) 4 bedder in Crestmead is only $380.

 

From what I know, those 4 bedders you refer too are usually newer lowsets with an ensuite which at best suits a large family fetching between 380-420/w max. They have 2 bathrooms but 1 is usually an ensuite to the main.

Cherubym's purchase is usually classed by agents as 'dual living' which caters more to extended families or even 2 families as there is usually clear separation, i.e. upstairs & downstairs are clearly partitioned, thus providing privacy.

It's this element which allows for the greater rent as 2 families can now pay less than 250/w ea for their own separate space, e.g. it can be nuclear family on top and grandparents down the bottom or 2 non-related families that are friends, etc.

Now not everyone wants to live in this sort of arrangement but I guess that is what is special about Logan's demographic. Ethnic groups such as islanders prefer this arrangement as it allows them to keep a sense of their tribal/communal heritage back home.

Helps the back pocket too

 

At the end of day to get such a high rent in this case people will be sleeping downstairs in an area which isn't legal height. The agent and owner knowingly understand this is to be the case regardless of how it is publicly advertised or put in writing. Simply by the rental return against comparable gives this away, and if that doesn't the amount of people residing will tell the rest.

You'd hope to g-d that there is no safety or other issue that happens underneath to the tenants.

Different to when you buy these type to live in yourself, you can do whatever you want and are only answerable to yourself and family if anything goes wrong.

As a landlord we have a duty of care which can't be buck passed to the agent if sh&t hits the fan.

We all need to sleep well at night, and sometimes I don't know if a little bit more rent rent is worth the higher wear & tear and potentially less squeaky clean deal compared to a regular place which is 100% legally built for sleeping throughout.

Maybe the landlord would be covered further if the tenants signs a legal declaration that no one will be sleeping or using rooms underneath that are not legal height as official bedrooms? That would narrow your tenant pool asking that to be signed.

Just my quarter cents worth, but not need everyone needs to agree, and I'm quite well aware that there and countless examples like this Logan - so it's OK because so many others are doing it and there have only been a few disasters with similar configurations - therefore chance of something going wrong or being hounded by council is low.

 

How does the living area classification work? Is it only if one classes it as a bedroom? There are plenty advertised as rumpus rooms etc. What about places that have a kitchen build down stairs?

 

It can't be classified as dual living if the downstairs is not legal head height as the rooms cannot be legally used as bedrooms.
Be very careful your property is not advertised as such.
Marg

 

Not really a planning issue unless there are more than 5 unrelated people residing there. >5 and probably breaking planning, building and fire codes

 

Thanks I thought you did insurance too?

 

One of my commercial litigators runs appeals against rejection of insurance claims. That is where the bca and fire breaches might come in to play.

 

I am interested. See a lot of the 'not legal height but built under highsets' in the outer north also. Rent for good money to large families or even sets of friends sometimes I think.
It would be interesting to know if PMs put all the names or numbers of occupants on the lease (that would be the smoking gun for insurers to use to reject a claim perhaps?).
Any PMs want to comment? I know PMs will not do separate leases.
So common as 2.1m is still quite comfortable. Council should just change the law on this one for older dwellings.

 

Do you think Crestmead / Marsden are still good suburb for new investors or have they already missed the bus assuming the growth started in late 2015 or even sooner?

 

Just my quarter cents worth, but not need everyone needs to agree, and I'm quite well aware that there and countless examples like this Logan - so it's OK because so many others are doing it and there have only been a few disasters with similar configurations - therefore chance of something going wrong or being hounded by council is low.[/QUOTE]


I heard that if the agent had advertised as 5 bed room and if something goes wrong downstairs then insurance company would check if the property was advertised legally as 3 bedroom.
If it was illegally advertised then claim becomes void.
If you advertised legally as 3 bedder plus 2 utility room then it becomes difficult to charge the 5 bedder rent.