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Our body corporate was ‘inactive’. RACT have a limit on the number of units on the site (7 if I recall correctly) but our broker found a company to do the strata insurance as we had 18 units on the site.
I’ve found RACT to be very price competitive for strata insurance for the smaller complexes
We have Strata Units in Tasmania and the Body Corporate has it’s own policy for the common property liability, held in the name of the Strata Corporation number.
Interesting question. I’d invest in areas/types of properties where yields are at an adequate level to offset the risk.
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This reply was modified 7 years, 10 months ago by
Tracey B.
Look for the gems because they are out there. Maybe not like Steve’s did initially, doubling in a short time but it’s the ‘non-standard’ properties that sometimes deliver exceptional returns and outcomes. You just need to think outside the box.
For our units in our area it’s definitely worth it – especially as we have some basic furniture that we put there ourselves. Any units shown to prospective tenants furnished are re-let in a much shorter time frame than if they are shown unfurnished.
In Tassie we can take it to small claims if it’s under a certain amount. Costs less than a couple of hundred dollars to lodge and usually has a better/quicker outcome than a debt collection agency.
I’d write to the owner first giving them x days to pay and advise that court action will be the outcome if they don’t.
Is they’re anything they’re paying for (or not) in the strata fees that you could withdraw from them? May need to get advice on the legalities of doing so in relation to the body corporate rules etc. but that may motivate them to contribute their fair share.
I hope you have a good outcome.
I agree with the other comments already made.
When making your offer explain why it is what it is. List the recent sales and provide full costings/quotes of all repairs required to bring this home up to the standard of those sold houses. Working back from the end market value will demonstrate that you’re not being unreasonable with your offer.
This process will also create doubt in the vendors mind that their house won’t sell because other potential purchasers will also find about the issues that you’ve found.
Put an expiry time on your offer and be willing to walk away – the next great deal is just around the corner!
Let us know how you go!
This is very interesting thread! At this risk of being shouted down I’d like to share my thoughts.
As an investor in the fund I am very happy with it’s performance. In fact I’d be happy to invest 10 times more $ if I had access to the funds.
Never before have I had access to an investment where the day to day management is transparent, both in relation to the upsides and the challenges encountered. The regular face-to-face updates, available only to investors in the fund, have provided me with many insights and strategies that I’ve been able to use in my investing activities here in Australia.
I have absolutely no concerns about the valuations. Whenever you can purchase property for lower than replacement value you have a base line of support. I am comfortable with the all of the properties held by the fund, the reasons they were purchased and the levels of occupancy achieved since purchase to underpin the increasing valuations.
In relation to the considerable gain on the foreign currency I have enjoyed being able to ride that wave. Whilst I am mindful it could head in the other direction before the wind up of the fund I can see the actions being taken by the managers to mitigate that risk. I also have an opportunity annually to exit the fund, should I choose to.
In a nutshell – this fund is by far the best investment, managed by someone else, that I’ve ever put money into.
I have sent you Justin’s details in a Private Message. He will be able to give you current information on the best areas/streets within those suburbs.
Lol, I don’t usually believe their blurb nor take much notice of it but I don’t see anything in there that is crap and thought it might be a useful read for people doing some research on the direction of Tas. I don’t read newspapers either because the media rarely seems to be accurate.
Regarding Burnie, it has some terrific yields, even in good areas. I’ve not invested there as I’ve not been comfortable with the employment challenges. Major employers open then close and also that mine workers from the West Coast have families based there which leaves you exposed to mining industry variables. Caterpillar relocating to Thailand is a negative although Dale Elphinstone is a very clever businessman, committed 100% to the NW Coast and I believe he will find a money making opportunity which will provide jobs.
Having said that, Burnie is an area I would look at again if I needed to venture out of my favourite towns because I think the jobs/employment profile may have changed since I last took a close look.Thankfully right now Tasmania’s unemployment rate is lower than both Queensland and South Australia!
Ivan, you made me laugh – we don’t have a ‘Tasmanian’ team because of our great players being drafted by the other AFL teams. ;-)
I believe Tasmania is headed in the right direction at the moment . At our last state election the greens won so few seats that they no longer have enough elected members to be considered a party. This means the government of the day has been able to get on with implementing sound, sustainable policy rather than constantly being pulled away in other directions and this has certainly been positive. My understanding is that around the time that Gunns went under the forestry industry reached a point of being self-sustaining on regrowth forestry and this industry is regaining strength, as is tourism. Agriculture has been very strong over a long period and continues to grow (why I like the North West Coast).
The current unemployment rate in Tasmania is less than both Queensland and South Australia.
Once investors are priced out of a booming market such as Melbourne or Sydney they will look to Tasmania which will in turn push prices up so we have been buying over the past 12 – 18 months as I don’t believe Tasmanian prices will go lower.
You will find when doing your research that some markets seem very confused ie. Ulverstone. The asking prices are all over the place there because several agents in Ulverstone ‘buy’ listings. There are also sellers hoping to achieve a sales price today which is equivalent to what they paid at the top of the market quite a few years ago. The reality is that just now we are in a buyers market and some have had to realise a loss to move on.
Benny is spot on – the gross yield is a starting point but you really need to look at the NET yield to ensure the next property you purchase moves you closer to your end goal. Do you know the net yield that you need to achieve for the property to fit your investing strategy?
Whilst yields are strong in George Town, I don’t invest there personally as I am not willing to run the risk of either of the large employers scaling back or closing. There are certainly some areas of George Town that you wouldn’t touch. There is an agent who is very active in the George Town market who has sold property for us in Launceston who I can put you in touch with if you’d like to do more research.
Ravenswood is considered one of the rougher suburbs in Launceston and there are pockets there that would carry a fair bit of risk to invest in and would be a no go for me. Having siad that, some parts of Ravenswood would be ok (my Grandparents built there in the 1950s and lived in the ‘better’ part most of their lives) although there are other suburbs in Launceston who are stronger performers – it’s just a matter of doing your research.
What net yield are you trying to achieve Lorella?
Sure, happy to share. Many of the local agents will hold your details if you know what you’re after although they don’t always remember to call if you’re not in regular contact with them.
I’ll Private Message you his details early next week as I’d like to speak to him first to let him know.
It depends what your goals are. Tasmania works for our strategy – we have cash flow positive investments on the North West Coast.
At the moment there are some well priced properties available – we are currently considering some more units near Devonport. To give you an idea – asking price is $125,000 per unit and they rent for $175 per week. Annual cost of ownership is $1,255. 6.2% NET on the asking price so possibly an even better yield if we can negotiate a lower purchase price or increase the rent. (Some others in the block rent for $195.)
Properties like this often don’t get to the internet as the agents will offer them to their database first.
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This reply was modified 8 years, 8 months ago by Tracey B.
Well done on finding a strategy that you’re good at and it sounds like it’s working for you.
To answer your question – if you’re happy with how your strategy is working for you and it’s taking you towards your goals in the time frame you’re happy with I wouldn’t change a thing.
If you want to make some chunks of money to pay down the debt more quickly then you might need to do some of the other things you mention. Do you have the knowledge and time (or people in your team) to use other strategies as successfully as the unit strategy?
Hi Argyle
We live in Tasmania and all our property investing activities are currently here. Our investing strategy is a little different – we buy high yielding property for our hold portfolio, purchasing below market value which provides an immediate capital gain. Sometimes we need to do something to those properties after purchase to improve yields. Subsequently these properties are being paid off by their own cashflow and also through chunks of profit from projects – flipping property, small subdivisions or unit developments.
The Tasmanian economy is showing signs of improvement as is the housing market. The North West, where most of our investments are, is underpinned by the strength of the agricultural industry with most of our residential tenants employed in agriculture or associated industries. Due to demand for high quality food I don’t see the strength in this industry changing anytime soon. We have also provided accommodation for the seasonal workers from overseas which has been positive for us. The farms employing these people have aggressive growth plans in the coming years so the demand is likely to increase.
There is also good demand for property in other areas – for example downsizers/retirees. There are many people relocating to Tasmania for their retirement, attracted by the laid back lifestyle and non-extreme weather conditions here.
I’d be interested to know whether you decide to do something in Tassie!
Tracey-
This reply was modified 7 years, 10 months ago by
