My banker has not been able to figure out how much I may be able to afford for me, so I am raising the question here, as many motel experts are on this forum. I have little idea about the banks’ LVR for freehold and leasehold motels. It seems that for freehold the LVR is up to 70% but is also depending on whether the sale is on split contract or not. Say if I have $300k of cash, would I be able to afford a FHGC motel of $800k, $700k or $600k? Any advice will be appreciated.
Hi Ergoudan.
Banks should be able to give you some ball park figure based on knowing your circumstances and by you giving them an example motel showing costs, turnover, age, condition, size, facilities like pool, restaurant, land size, historic figures, SWOT analysis etc. You need them to give you an indication of how much $ you can go shopping with. LVRs differ between applicants and motels and current economic conditions. Start with what you want and why.
Cheers
thecrestthecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
Thanks for your advice. I ended up buying a cheap motel in 2016 and sold it in early 2021. Paid a little over $400,000 for a FHGC and the capitalization rate had been about 40-50% (net a little over $200,000 pa).
Thanks for your advice. I ended up buying a cheap motel in 2016 and sold it in early 2021. Paid a little over $400,000 for a FHGC and the capitalization rate had been about 40-50% (net a little over $200,000 pa).
That’s a nice result, kudos.
Colin Rice | CDR Finance
http://cdrfinance.com.au/
Email Me | Phone MePerth Based Mortgage Broker - Investment Property Finance Specialist | E: [email protected]
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