Hi everyone, I’m new to IP so I need a lot of help. I have been doing a lot of looking around and am currently considering brand new homettes priced well under 100k with potential for great return. However it is based in a caravan park and is only selling as a construction without the land component. Does anyone here have any thoughts on this? If so it will be greatly appreciated.
Thanks.
This shouldn’t really even be considered as real estate. It is more like an equipment leasing enterprise.
The total price will be depreciable, but you will have no land value appreciating.
I personally would not touch these.
Simon Macks
Residential and Commercial Finance Broker
***NODOC @ 7.15% to 70% LVR***
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0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
I agree. No land…no deal.
I heard that these units still go up in value. Probably by a small amount, but they also seem to have very good +ve gearing. And the bonus is that they are cheap with virtually no vacancies in this area.
I would steer clear of this type of deal!!!
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Originally posted by investingracer:I heard that these units still go up in value. Probably by a small amount, but they also seem to have very good +ve gearing. And the bonus is that they are cheap with virtually no vacancies in this area.
Of course they get good rent! Purely because the purchase price is low and this is because demand is low.
I am not saying not to get one.
I am saying they are not IP’s. More a business decision. Not even sure that you can get a mortgage for them?
Cheers,
Simon Macks
Residential and Commercial Finance Broker
***NODOC @ 7.15% to 70% LVR***
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
What return are you going to get?
If the yield is good enough after costs it might be worth thinking about. But then if the yield was hugely cashflow positive, then why aren’t the developers making the cash?
Avoid.
Looks like at best you will get your 100K back in rent over 20 years and then probably have a worthless asset.
Life is like a box of chocolates – you never know what you’re going to get!
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