All Topics / Help Needed! / Do you think student accommodation is a good investment?

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  • Profile photo of LouieroLouiero
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    @louiero
    Join Date: 2011
    Post Count: 6

    http://www.realestate.com.au/property-unit-qld-meadowbrook-106913034

    The catch from my asessment of these types of properties is that the capital gain is minimal over time but it's a nice little money spinner.  Anyone else have thoughts on these types of properties.

    Profile photo of fWordfWord
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    @fword
    Join Date: 2009
    Post Count: 471

    With the strength of the Aussie dollar I would think that the number of students coming here would be much reduced. If this is the case then you may have trouble renting out your property.

    Profile photo of Ryan McLeanRyan McLean
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    @ryan-mclean
    Join Date: 2010
    Post Count: 547

    Just note that though student properties may appear to have a high rental return they are often vacant for 2-3 months of the year when the students are on holidays.

    This can put a strain on your cash flow.

    Not saying don't do it, just saying that this is something to be aware of.

    Ryan McLean | On Property
    http://onproperty.com.au
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    Profile photo of v8ghiav8ghia
    Member
    @v8ghia
    Join Date: 2005
    Post Count: 871

    Hi Luiero…….my opinion only – No.
    Finance is usually a lot harder to get too, depending on size of property.
    Cheers

    Profile photo of sonyasalsonyasal
    Member
    @sonyasal
    Join Date: 2008
    Post Count: 421

    HI, i have been looking at buying an old nursing home that has a large kitchen 16 rooms and a number of bathrooms and setting this up as student accommodation. Any thoughts? My niece is off to uni this month and her accommodation costs are $200/week with 4 other people in a five bedroom townhouse, this includes utility costs.She is responsible for her own cleaning of the house along with her housemates. She pays rent for the whole year, rather than not paying for two or three months as mentioned above. So the figures outlined above look pretty good to me. $1,000/week rental income on a five bedroom house. If i was charging the same amount for a 16 room set up then that would be $3,200/week.

    Let me know what you think, i would really appreciate any comments from someone who has invested in a similar set up.

    Profile photo of Jacqui MiddletonJacqui Middleton
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    @jacm
    Join Date: 2009
    Post Count: 2,539

    Hi Sonya,

    Students are not the only demographic that require basic or short-term accommodation.  For example, people employed in professional roles that are moving interstate ad are looking for somewhere to live for a while… or in fact professionals just looking for a room in a house for a long while, but don't want the nuisance of a regular sharehouse where the divvying up of bills is a battle.

    ps have you checked with council to see what zoning the property is sitting on, and what types of uses are permitted?

    Another thought is that you could advertise rooms on the Stayz website as basic holiday accommodation…

    Jacqui Middleton | Middleton Buyers Advocates
    http://www.middletonbuyersadvocates.com.au
    Email Me | Phone Me

    VIC Buyers' Agents for investors, home buyers & SMSFs.

    Profile photo of Property investingProperty investing
    Participant
    @property-investing
    Join Date: 2011
    Post Count: 1

    Reading the comments about student accommodation, i have two IPs which i rent out by rooms (not always to students, mostly to workers) and i find that the rental income is far better than renting the whole house out, however, the lender refuses to revaluate the property so we can restructure the loans to extract the extra equity for the next IP purchase. Would you know how to get around this issue ? Thank you,

    Anne

    Profile photo of Alistair PerryAlistair Perry
    Participant
    @aperry
    Join Date: 2004
    Post Count: 891

    No, unless you get them for a ridiculously low price. For most investors they just tie up equity and stop them from doing other, more profitable things. 

    Profile photo of Ryan McLeanRyan McLean
    Participant
    @ryan-mclean
    Join Date: 2010
    Post Count: 547

    @ Anne – Do you manage the property yourself or do you have someone manage it for you?
    How do you select people for the rooms? Do you have to take into account group dynamics?

    Ryan McLean | On Property
    http://onproperty.com.au
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Viewing 9 posts - 1 through 9 (of 9 total)

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