Defence Houseing
- Thread starter localinvestor
- Start date
We hit the wall after property 5 - not the serviceability wall the frustration wall, late rent, no rent, vacancies, damage, surprise sat night electrician callout fees so on - we looked at DHA and bought.
The extra 8% mgt fee gets me no hassles, no vacancies, no damage, no late rent, a repaint and recarpet at the end of the deal. And the surprise an independant rental review every Dec in the last 3 years they have written to me twice to say they are putting my rent up $20pw - none of my other properties are so stress free.
It gave us back sanity to go and purchase other properties knowing that one is just working away.
I have clients who have bought DHA and are happy. I am more than happy to give DHA more testimonial because at the end of the day it has worked for us. You will find some lenders do not like the limited resale market, where as some lenders like the security and have allowed up to 100% of the rental to be used in serviceability calcs, valuers are not always sure what to do with them and the values can come in a little low, the house next door they are comparing it to does not have the security on windows and doors and the repaint carpet at the end of the lease. For these there sometimes can be a higher price tag.
It was a step we were willing to take. At the end of the day though you need to be comfortable that you are buying in an area that after the 9 or 12 year lease you have a property where people want to rent or buy and which will have some growth. Once again research is king and it should not be a blind investment.
Buzz
The extra 8% mgt fee gets me no hassles, no vacancies, no damage, no late rent, a repaint and recarpet at the end of the deal. And the surprise an independant rental review every Dec in the last 3 years they have written to me twice to say they are putting my rent up $20pw - none of my other properties are so stress free.
It gave us back sanity to go and purchase other properties knowing that one is just working away.
I have clients who have bought DHA and are happy. I am more than happy to give DHA more testimonial because at the end of the day it has worked for us. You will find some lenders do not like the limited resale market, where as some lenders like the security and have allowed up to 100% of the rental to be used in serviceability calcs, valuers are not always sure what to do with them and the values can come in a little low, the house next door they are comparing it to does not have the security on windows and doors and the repaint carpet at the end of the lease. For these there sometimes can be a higher price tag.
It was a step we were willing to take. At the end of the day though you need to be comfortable that you are buying in an area that after the 9 or 12 year lease you have a property where people want to rent or buy and which will have some growth. Once again research is king and it should not be a blind investment.
Buzz
There is of-course another aspect to consider about to DHA or Not DHA:
You will have a lot of trouble negotiating on the purchase price. If you believe that for an investor, your profit is made whan u buy, then DHA are an average investment. No negotiation, just take it or leave it.
The opportunity to get 20% off the asking price does not exist.
But some people relish that part of the game and some prefer to watch from the sidelines.
That does not mean they are a bad investment over 10+ years. But for those who wish to make money from day one, it won't happen with DHA properties.
Having said that, when I consider some of the asking prices in my local area in Sydney for knockdowns vs DHA say in Canberra or Townsville or Brisbane, then DHA aren't so bad.
Each to their own, you have live inside your context.
JB
You will have a lot of trouble negotiating on the purchase price. If you believe that for an investor, your profit is made whan u buy, then DHA are an average investment. No negotiation, just take it or leave it.
The opportunity to get 20% off the asking price does not exist.
But some people relish that part of the game and some prefer to watch from the sidelines.
That does not mean they are a bad investment over 10+ years. But for those who wish to make money from day one, it won't happen with DHA properties.
Having said that, when I consider some of the asking prices in my local area in Sydney for knockdowns vs DHA say in Canberra or Townsville or Brisbane, then DHA aren't so bad.
Each to their own, you have live inside your context.
JB
My DHA is a 4br house in Manly, Sydney with av house price in the street of $1.2mill. I bought off a current investor - with price negotiation. There is always a way to get what you want, sometimes just not the way everyone else is doing it.
Buzz
Buzz
