Hi,
I was looking at the Dale Alcock web site and they sell their display homes. They rent them back for 7% of the purchase price as rent for 1 yr with 6×3 month options.They have a depreciation schedule included in the price, so properties should go cf+ i would imagine after tax.
Has anyone bought one of these investments and if so how did u go? I will be attending an info evening on this[computer]I’ve been looking at the melbourne market for house and land packages as investments.
Devine do 4.7% rent guarantee for first 12 months.
One bonus with these seem to be if you put a small holding deposit on a block in an estate in the very early stages of it being released, the value will often jump 20 – 30 grand quickly once a few fancy houses have been built and the area revalued.
Just watch out for oversupply and slick talking sales guys.
I am in the process of extricating myself from a deal whereby i was going to be refinanced out of my existing properties for the purchase of house and land…. i was promised all the money in the world. I took a step back and investigated further into the fees and extra charges I would be up for and found that I would be forking over an extra $8000 that I didn’t need to.
The quick gun financier for the company did not take much interest in structuring the best deal for me….. more interested in getting a commission from my money being sent through his bank.Telling me that it would be rolled into the loan anyway………. an extra $8000!!!!! plus paying interest on that for 25 years………..
and that was before I even started looking at the extra charges for the house and land.
When I asked about what extra costs there were, I was just brushed off. Even specific questions were waived with remarks that avoided the question.
I feel for the new home owners that are purchasing through some of these companies and are not aware that a large portion of their fees and costs are a lot higher than they need to be…..until they have to start paying them off for the next 25 years.
And boy did the guy get gnarky when I pointed out that I would be crazy to refinance when it was going to cost me $3000 in break costs from my existing loans and then I would have to pay $5000 in Lenders Mortgage Insurance that I had only just paid….. 12 months AGO!! When my existing lender said they could provide the same money without any of these costs!
Be careful.
Live, Learn and GrowLifexperience
Hi lukis p ,
I bought one ( with 12 month lease-back ) though at the time I wasn’t in to RE Investing.
It ended up being the starting point for my RE Investing though , at which time I realised that I’d paid too much for it .
Builders usually build in fairly healthy profit margins for themselves in these display homes !
A Quantity Surveyor is money well spent .
Cheers,
MichaelMLV
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