Finance for small units

[Elma the Fuzz]

Dear Finance Wizards

I would like some feed back on getting a low doc loan for a unit about 42m in size (not including balcony) with car park. Could you please give me a roungh idea on max LVR available.

Please?

Elma

 

[The_Husband]

Dear mr Fuzz

Is that you real name?

I think you will find that you will have a hard time getting a normal loan for something so small. Even harder for a low doc.

Sorry can't really help other than that. Come to think of it no help at all really. I should just delete this...............

 

[Rolf Latham]

Hi Elma

Some private funder would take that on with a minimum of 66 %

Ta

rolf

 

[The_Husband]

Elma

Try RAMS. They have a low doc at 80% LVR and do units over 40 m, but not inner city (I think).

TH

 

[investor]

Originally posted by The_Husband
Dear mr Fuzz

Is that you real name?

I think you will find that you will have a hard time getting a normal loan for something so small. Even harder for a low doc.

Sorry can't really help other than that. Come to think of it no help at all really. I should just delete this...............

HAHAHAHAHAHA

Hi Fuzz

Is the unit u r looking to buy in Sydney ?
I know u r in Melbourne but I saw a similar one in the papers here in Sydney. Just curious

 

[bbruham]

G'day Mr Fuzz,

Caught by the Fuzz! ( must hurt).
Only joking!!!!!!!
The only problem I have with a unit THAT small is who would want
to rent it. That is just too small. Imagine sitting at home on a wet miserble day, with nothing to do, like being in a prison cell.
The other thing is, if you decide to sell at a later date, is this unit going to be easy to off load?
Just my thoughts.

Bruce G.

 

[geoffw]

Bruce,

There is a definite market for units that size.

It's aimed at singles- and, quite often, at the lower end of the market.

I have a block of eight such units. It's a mix of unemployed, old aged pensioners, and singles for other reasons.

The price is low- but they provide good value. They are at the bottom end of the market- as such, there is not much competition from the multitude of new units coming onto the market.

They fill a need. People who live there cannot afford to live in nice big units.

Because I bought the block, the bank was not too worried about the size (about 45 sqm per unit).

It's in Queanbeyan (near Canberra)- we're talking about less than ths cost of an average house in Sydney.

 

[XBenX]

and 8-9% yields as well

 

[geoffw]

Originally posted by XBenX
and 8-9% yields as well

Yes, I'm not complaining about the yields - but that does come with a risk. There's a much higher chance of defaults. Two tenants now are in arrears (up to two months), and have been to the tribunal.

Luckily the PM deals with all of that- it would be too much of a hassle for me to do.

 

[Jas]

Originally posted by geoffw

I have a block of eight such units. It's a mix of unemployed, old aged pensioners, and singles for other reasons.
...
It's in Queanbeyan (near Canberra)- we're talking about less than ths cost of an average house in Sydney.

Geoff - I'm interested in this. I saw a block of units in Queanbeyan and the price was more than than what the indivudal units would have gone for. Needless to say, I passed on this opportunity.

In talking with the agent, he said most of the blocks where snatched up by stupid syndeysiders who had no idea of Queanbeyan pricing.

Did you find that at all? (this was more than a few months back now)

Jas

 

[geoffw]

Jas,

I paid a small premium for the block because there is potential to build more (though I am not proceeding with this just now, as building costs are rather high- and indications are that they will drop in the next few years).

Returns are good, but not as good as they were a few years ago. The price of units in the area has gone up rapidly.

The last block I saw on sale was for a comparable cost per unit as mine- but for smaller units in quite bad condition, and with little off-street parking.

My friendly real estate agent has told me that interest in blocks has gone up considerably since my offer was accepted in July.