buying of property with long lease guaranteed by Housing Commission

[newcomer]

Hi,

I came across this property from REIV site:

http://www.realestateview.com.au/Real-Estate/Property-Details-buy-residential-1564632_S.html

It is something new to me, i.e. the property come with long lease from Housing Commission. What I know about Housing Commission are usually those tall Housing Commission Flats, which I believe are owned by government. I didn't know that Housing Commission lease property from private investors and then sub-lease it out?

Would appreciate if anyone can share their experience with me.

My questions are:
- presumably I (as landlord) will enter into lease agreement with Housing Commission, and they in turn will find tenants?
- this means I don't have control as who is the tenant?
- also means that even if the property is vacant, changes in tenants etc, I still got my rent income?
- presumably the rental will be below market rate?
- presumably the surrounding houses are also being leased to Housing Commission? is there a way to find out ?
- presumably at the end of lease term, if Housing Commission wants to extend the lease, I don't have the choice to say No?
-usually how long is the lease term?
- looks like if I want to sell it, I can sell at the open market like what the current owner do, but with the same restrictions that it must be leased to Housing Commission. Would it impact its capital growth, i.e. will it has lesser capital growth opportunity/ less attractive for investors? It seems that this is an old listings, so wondering if it may be hard to sell subsequently?
- any other thoughts/ comments?

Thanks

 

[Pa1nter]

This is only my opinion as I have had only a small amount of contact with this type of property.

I believe you will find it hard to get insurance when your house is rented by Housing commission,check that out as it is a very important item.
Ring an insurance company and get a quote,

Usually very long term leases,5 years with option to renew,I believe maintenance can be attached to the lease and they look after that side of things.

The lease will then probably be attached to your deeds and searches from other party's will turn up that housing commission lease.

 

[newcomer]

thanks for pointing out about the insurance part...such an important part that I have overlooked!! I am just thinking about investing in property for the first time, so still a lot to learn. Thanks again for the advice

 

[Peter_Tersteeg]

At the end of the lease, do they return the house to you in the same condition that you gave it to them? Make sure it's a condition of the lease.

It seems a lot of the tenants from hell end up in housing commission.

A lot of people looking for long term leases purchase through the Defense Housing Authority. It's not for everyone, but most are generally quite satisfied at the end of the lease.