Hi all.
I have come across some properties that appear to be postive cashflows for less than $100,000 in Retirement Villages.
It appears these are investments where the unit owners share in the profits after expenses.
Has anyone out there got actual experience or ideas in relation to thses type of investments?
Thanks in advance.
Michael and Loretta
Problem is that you can't borrow against them! (Or you can only borrow 60% LVR or something like that – can't remember which.) So unfortunately they suck as an investment proposition.
WOW!
Is that correct that it is hard to borrow for these types of investments? hmmmm Thanks for that, Trakka. I was looking at putting in about 20% of the cost.
Ring up your mortgage broker and check, but I've done a bit more searching and I have a feeling that you'll be lucky to get 60%. Basically, the more "specialised" and "unique" the security is, the lower LVR you can borrow against them. So a "bog standard home or reasonably sized unit" – up to 100% or even 106%. Some commercial properties with a diversity of potential uses – max 85%. Specialised properties – max 60%. And various categories in-between.
Wow!! Thanks for that, Trakka. We may need to do more research on this then DEFINITELY!!!!
Thank you for valuable information you have given us.
what about covenants on apartment blocks which say that everyone has to be over 55?
does that count?
say someone is over 55 can they live there and have people under 55 living with them?
what about with student apartments, if i buy a 2 bedroom student apartment can only students live in them?
Any place with covenants restricting the age or occupation of occupants (eg over 55s, students) is going to be difficult to get a high LVR lend. Generally under 55s can't live in over 55s accommodation, and they're exempted from age discrimination laws so you can't get around it that way. And non-students generally can't live in student accommodation because the fire safety regulations for student accommodation are not as stringent as for boarding houses that are open to non-students (at least in QLD). Landlords/property managers can restrict who lives in certain types of accommodation, and that will mean that you can only get a 60 or 65% LVR.
Taking the above details we have been discussing though – knowing that these types of investments are "specialialised"- I have noted again that the nett return are still between 8 – 10%. Is it still worth considering these types of investments?
Taking the above details we have been discussing though – knowing that these types of investments are "specialialised"- I have noted again that the nett return are still between 8 – 10%. Is it still worth considering these types of investments?
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