All Topics / Help Needed! / Investing in units in Cairns

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  • Profile photo of dare_to_dreamdare_to_dream
    Member
    @dare_to_dream
    Join Date: 2006
    Post Count: 88

    Hi guys,

    I’ve noticed that particularly in Cairns (but also Darwin somewhat) that there appear to be alot of places that are selling units in resorts or hotels and then gaurantee a weekly rent that will give 7-11% gross return.

    Has anybody bought any of these type properties and would you recommend looking into buying one?

    Thanks
    Paul
    [biggrin]

    Profile photo of jnistedjnisted
    Member
    @jnisted
    Join Date: 2006
    Post Count: 39

    Hi Paul

    Margaret Lomas talks about these types of properties in one of her books (I think it’s her 3rd book but don’t quote me). She gives a run through of the pros and cons and what to look out for.

    Janet

    Profile photo of Luan CaoLuan Cao
    Member
    @luan-cao
    Join Date: 2004
    Post Count: 23

    Hi Paul,

    From my experience I have found that many of these types of property investments have high management, strata or body corporate fees that negate the initial high yeild that you think you will be getting from teh property.

    Have a look at the fine print and see how you go.

    Also could I ask how much and how large these properties are.

    Kind Regards

    Luan
    http://www.ampg.com.au

    Profile photo of depreciatordepreciator
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    @depreciator
    Join Date: 2003
    Post Count: 541

    They can also have very high cleaning/laundry charges that aren’t in the sales documentation. These charges can be as high as 20% of the gross rent.
    Scott

    Tax Depreciation Schedules
    Australia wide service
    1300 660033
    [email protected]
    http://www.depreciator.com.au

    Profile photo of dare_to_dreamdare_to_dream
    Member
    @dare_to_dream
    Join Date: 2006
    Post Count: 88

    Hi guys,

    Thanks for your replies.

    I’ve talked to the real estate agent who sent me a complete list in an excel document of all the outgoing fees and rental returns and the property is still cashflow positive. The properties are returning 10.5% gross and 7.91% net after all corporate fees. (neglecting any land rates and some annual fees)

    The only thing i’m not sure about is that its not a traditional resort that guarantees the rental returns, this is more like a large village of units with corporate body fees but its up to me (the landlord) to find tenants.

    I don’t know much more than this unfortunately.

    Regards
    Paul
    [suave2]

    Profile photo of crushercrusher
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    @crusher
    Join Date: 2002
    Post Count: 186

    How can they guarantee rents if you have to find the tenants? I have an IP (house) in Cairns and I think I know the development that you are talking about.

    Regards

    Todd Burns
    http://www.freepropertyhelp.com.au

    Profile photo of taffytaffy
    Member
    @taffy
    Join Date: 2003
    Post Count: 9

    hi paul

    currently living in cairns,whats the complex called,may be i know it
    or could find out the location ,size etc

    steve

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