Buying in minning towns

[Marmoura2001]

I bought established house 350k on 1012 m2 block currently rented for 850 pw furnished, in Miles one dwelling per 300 m2 is allowed. Building 2 x 4br dbl storey townhouse development at rear of block, due for completion mid Nov. Going to rent them all out, maybe sell one in a year or so.

Did you find any difficulty renting out the existing house? Or do you expect to find any difficulty renting out the town houses with an increasing vacancy rates for miles at the moment? That is my biggest fear .I won't be able to afford to pay the mortgage if the house is vacant for few months.my strategy in this investment is a positive cash flow as I already have another one negatively geared in Melbourne with a huge potential of capital gain down the track.

 

[powderfingers]

I bought the house a year ago so had no trouble renting it then. I think this region will be up and down as far as rental vacancy/ demand goes, you just have to ride out the bumps. It should tighten up again in next few months (http://www.theaustralian.com.au/arc...c-in-surat-basin/story-e6frg9ef-1226713191557)

You just have to be prepared to drop the rent if need be.

 

[JPS25]

According to all what I read there are no caveats on the rental guarantee. It runs for 5 years and it is 10% p.a.it increases annually as per CPI.it can be renewed for another 5 years if I wanted. There is a management fee of 8.5%.

The property is in miles and some of the projects are confirmed .

If this is what I think it is they are also in Chinchilla with a guarantee rent of 8%

You buy from the builder who then becomes your tenant and guarantees the rent. He in turn sub lease's the unit as a furnished property (He furnishes it) and charges you 8.5% management fee. Your guarantee goes up each year by CPI at the end of 5 years he removes his furniture and returns the property to you as it is.

Think about it check out realestate.com.au and property managers How much is in it for the builder ??

There was a thread recently same thing on Chinchilla

Do your research carefully

If you buy/build a property it should be able to stand on its own two feet without a rental guarantee

Jean

 

[JPS25]

Oh and yes if things are going great you may get another 5 years
But what if rents are dropping ???
What if they have dropped badly ??
Do you think he will carry on paying you more than he is making

He will walk away as bankrupt and leave you hanging rent guarantee meaning nothing

Think about it carefully

 

[Marmoura2001]

I bought established house 350k on 1012 m2 block currently rented for 850 pw furnished, in Miles one dwelling per 300 m2 is allowed. Building 2 x 4br dbl storey townhouse development at rear of block, due for completion mid Nov. Going to rent them all out, maybe sell one in a year or so.

thanks for all your help and suggestions.really much appreciated.I am now considering listenning to all what the opinions said on the forum and having a big block then considering a subdivision latter.did you say that a dwelling is allowed per 300m2? because i spoke to the council and Dianne there said it is one per 450m2. what about the access dimensions..my real estate says it has to be more than 4 m when again dianne is saying only 3.5 m for a duplex or triplex..not sure who is right so just thought i might ask you because you have done it recently and you would know.
what would be the cost to construct 3 x 3 bedroom, 2 bathroom villas (120sqm of building)? what would the pessimestic resale value be you reckon?

 

[powderfingers]

Well mine is 2 x 4br dbl storey attached townhouses size 150 m2 each, plus the original house at the front of the block, I have 5m side access. You'd want to look for something with at least 4m to be safe. Building costs are higher there, around $1600 per m2 plus for turnkey.