Student accomodation

[Crankshaw]

What are peoples thoughts on purpose built student units, 4br, 4 bathroom type place, 5 min walk to uni, many have returns around $680pw with asking around $190k, if outgoings were about the $350 - $400pw mark, to me that still seems like a reasonable return.

Over the last month or so I have just stared seeing what is available as IP, all new to this, scary stuff !

 

[Jake Milne]

From a cashflow perspective student accom can be better than other similar options such as holiday rentals or serviced apartments. They're sometimes easier to rent out consistently as students may stay in the same room for several se/trimesters or even years.

It does depend on the area and Uni you're buying into though. Like any investment you'll need to do you due diligence. Try to understand how many students attend, how much on site accom there is and how big the shortfall is for the excess students.

The issue with these types of properties that you should seriously consider is that they can perform very poorly from a growth point of view due to the fact that only other penny pinching investors will purchase this from you later. Capital growth is the most powerful way to make money in property as it does something that rental income and renovations do not... Growth compounds over time.

So my recommendation to people who are new to investing is try and focus on getting one or even a few good growth properties. They'll be your cornerstones in the future as their equity compounds meaning that the end result will be more money than by focusing on cash flow from the out set.

The knack is finding the right property with as much growth as possible whilst working in the constraints of your budget and debt servicing ability.

Hope that helps.

 

[jerryparker]

Student Accom

What are peoples thoughts on purpose built student units, 4br, 4 bathroom type place, 5 min walk to uni, many have returns around $680pw with asking around $190k, if outgoings were about the $350 - $400pw mark, to me that still seems like a reasonable return.

Over the last month or so I have just stared seeing what is available as IP, all new to this, scary stuff !

I am onto some on the Sunshine Coast...positive return...and with the University enrolment figures on the increase...and they can walk to class. Its like having a coffeeshop outside the movie theaters...the convenience factor.


PM me if you want more info. cheers

 

[FlyingFox]

Interesting article from yesterday - http://www.theherald.com.au/story/2948274/students-cram-for-accommodation/?cs=305

 

[Deltaberry]

Wouldn't buy it individually. But maybe if you owned the land and a complex.