Hey Guys, what do you think about unapprved student housing? I saw one online http://www.realestate.com.au/property-house-nsw-newtown-115049543, return is high at $2,200 pw, not sure the yield because it's for auction, would it be ok to buy and keep renting this way?
Unapproved student housing
- Thread starter Williamyuan
- Start date
Consider insurance in the event of accident/negligence etc..... Would you Public Liability cover in the event of accident and somebody was seriously injured/killed?
I am no expert in this area but these are the things I have considered on properties such as this. It does scar me but depends on your risk profile.
I am no expert in this area but these are the things I have considered on properties such as this. It does scar me but depends on your risk profile.
I had a look at the listing and i don't understand. Why would you need approval to rent to students?
In qld you can rent to anyone as long as there are no more than 5 unrelated people in the same house. Doesn't matter if they are students. If they are students renting per room then you put them all on the one tenancy agreement and you proportion rent to each individual. All legal, all fully insured.
In qld you can rent to anyone as long as there are no more than 5 unrelated people in the same house. Doesn't matter if they are students. If they are students renting per room then you put them all on the one tenancy agreement and you proportion rent to each individual. All legal, all fully insured.
To get that kind of rent they probably have 4 bunk beds per bedroom.
I don't see any benefits of this particular property over every other similar property in the street.
What's to stop all the others doing the same thing considering there are no approvals in place.
So the $2,200/week "approximate" income should not be considered when valuing this property.
What's to stop all the others doing the same thing considering there are no approvals in place.
So the $2,200/week "approximate" income should not be considered when valuing this property.
Agree. It's also being sold as vacant possession according to the online listing, so even more reason to ignore the alleged previous rental income reported.
I am no expert in the Sydney market however with the momentum it currently has and the location in Newtown, I reckon investors will be priced out by PPOR buyers who will renovate and restore.
How does one get approval/license for student housing?
Do you need a certain zoning?
Apply to council as a student housing business?
Do you need a certain zoning?
Apply to council as a student housing business?
I estimated there are 11 paying guest living there.
From the photos, they only show a pic of 1 room with 1 bed. This being the smallest room and probably paying $300 for own room.
The plan doesn't show but I believe the Dinning and Living rooms are sealed to be rooms.
The Living and Bedroom1 are the biggest and probably have 3 paying individuals in each of the rooms while rest has 2 beds in them, so about total 11 shared plus 1 own room.
Sharing is about $180 x 11 = $1980
1 Own room = $300
Total = $2,280
There are only 2 bath and toilet to share with 12 room mates, so better take your shower and poo early before peak lecture starts...
This terrace can be chopped up to 5-6 rooms hence would be appeal to risk taker investor. Most other terrace in Redfern/Chippendale/Newtown are more narrower and shorter block and unlikely to dice up to more than 3-4 bedrooms
From the photos, they only show a pic of 1 room with 1 bed. This being the smallest room and probably paying $300 for own room.
The plan doesn't show but I believe the Dinning and Living rooms are sealed to be rooms.
The Living and Bedroom1 are the biggest and probably have 3 paying individuals in each of the rooms while rest has 2 beds in them, so about total 11 shared plus 1 own room.
Sharing is about $180 x 11 = $1980
1 Own room = $300
Total = $2,280
There are only 2 bath and toilet to share with 12 room mates, so better take your shower and poo early before peak lecture starts...
This terrace can be chopped up to 5-6 rooms hence would be appeal to risk taker investor. Most other terrace in Redfern/Chippendale/Newtown are more narrower and shorter block and unlikely to dice up to more than 3-4 bedrooms
Doesnt matter if students or not
Please correct me if I'm wrong, but I am fairly certain The Boarding Houses Act 2012 applies to any property being rented to 5 or more unrelated tenants in NSW? This means the building must be registered and inspected to meet the provisions of the act.
http://www.fairtrading.nsw.gov.au/f...rding_houses/Operating_a_boarding_house.page?
http://www.fairtrading.nsw.gov.au/ftw/Tenants_and_home_owners/Boarding_houses.page
http://www.fairtrading.nsw.gov.au/f...rding_houses/Operating_a_boarding_house.page?
http://www.fairtrading.nsw.gov.au/ftw/Tenants_and_home_owners/Boarding_houses.page
correct, but boarding house is not automatic when you have trigger certain threshold of unrelated guest. the application for boarding house requires strict fire safety such as sprinkler installed. It also change some bills such as electricity to commercial which means you pay more, plus insurance for boarding house, and valuation of property considerations because of the class1a to 1b in NSW, etc...
interesting to know other states like they're able to advise how many unrelated guest on state basis, whereas in NSW every council appears to have a different unrelated guest threshold
interesting to know other states like they're able to advise how many unrelated guest on state basis, whereas in NSW every council appears to have a different unrelated guest threshold
i think there are much more boarding house that is no registered in the fairtrading url link above. owner reliaze that once they registered, the council knows about it and will inspect and demanding expensive fix etc.
then there case where some owner just keeping rooming, and unconscious realize they exceed a certain threshold of unrelated guest, and should classed as boarding house.
then there case where some owner just keeping rooming, and unconscious realize they exceed a certain threshold of unrelated guest, and should classed as boarding house.
You pray (in whichever direction turns you on) every night that the student in room X doesn't have an accident with the camp stove that they're using to heat the wok and burn the place down causing an inquest to be held. Council coming down for breach of the approved use/development approval/illegal building works etc.
Ah ok, if having 5 or more unrelated tenants does not instantly require a property to be registered as a boarding house would you be able to tell me what does?
My interpretation of that legislation has been a significant factor in my lack of interest in student style investments. Probably rather silly to not seek advice on a third party in hindsight.
If you want to do it properly you probably need to install lifts and ramps for disability service under new building codes for guest houses. Set you back a few hundred k.
