Right now you may be on the fence as to whether to move out solo or with another individual. Consider these options for the latter.

Tenants in Common

Ideal for individuals who don’t want equal ownership, ‘Tenants in Common’ depend upon the agreed shares of each party which may be something like 70/30. This also means that if one party dies, rather than their interest passing on to the other tenant, it goes on to the individual’s estate and will.

Joint Tenants

The most common form of ownership, particularly for husbands and wives is ‘Joint Tenants’. Essentially what this arrangement entails is that both parties have equal shares. Alternatively to Tenants in Common, if one party passes away, all the shares are transferred to the other individual through rights of survivorship.

Although this is universally the most common option, it is not always the best. For example, in the situation where one party is earning remarkably more than the other, an arrangement such as Tenants in Common may be more appropriate in certain situations which will be discussed below.

These options are polar opposites which can make it hard to decide, however, fortunately there can be some flexibility in certain cases. There are different situations that can arise which would combine both. An example would be if a third party was involved that desired a smaller share, whilst the first two parties would share the greater half. This would result in a Tenants in Common and Joint Tenants relationship.

How to Determine What Option to go With

Whether you go with Joint Tenants, Tenants in Common or a combination will solely depend on your circumstances and personality. There are certain factors and situations that call for one option over the other. The below points will provide you with some insight as to what option may be more appropriate for you depending on your conditions.

Joint Tenant

• Both parties are in equal or similar income brackets.
• Ideal for married couples or business partners.
• Continuity – you desire to keep ownership of the property for whatever means if the other party dies.
• Financial stability – will not go into turmoil if other party becomes deceased.

Tenants in Common

• You earn significantly more or less than the other party.
• You do not want full ownership if the other party passes away.
• Financially cautious (lower income party).

Both options are advantageous depending on your situation. The final decision would have to be made between the two main parties or more, to come to a conclusion if you’re set about moving out with someone. Ideally if there are more parties involved, a combination may be the best option.

Although Joint Tenant has historically been seen as the default option in most cases, this is beginning to change as people have begun to act more consciously with their capital in property purchasing. At the end of the day, it will come down to your research as well as your knowledge to choose the option that’s best suited for your circumstance.

Want some help deciding which option is best for you? We can help! Contact us today.

Although unfortunate, it is a fact that frivolous lawsuits are an issue and people are taking advantage of our legal system. Wealth can be acquired throughout an entire lifetime, and taken away by one superficial claim. This article will go about explaining the different ways you can protect yourself from this fact so that you never have to suffer from a frivolous creditor.

Individual ownership of assets

The best way to shoot yourself in the foot in terms of asset protection is to own investment properties in your own name. In the case of being sued you are at risk of losing everything under your name.

Many people would argue the tax benefits and cost effectiveness you would receive by using your own name, and they would be right, but the argument for the potential loss is a much better one if your focus is on protection.

Company structure

An alternative to individual ownership is using a company structure, which is characterised by being a separate legal entity from the owner. In the case of asset protection, this is a much safer and wiser choice as the risk is transferred to the shareholders in the company.

The issue with this structure is that if the individual happens to own all the shares in the company, much of the asset protection benefits you would receive from this form of ownership would dissipate.

Trust fund

Typically, property investments owned in a generic trust are the way to go over the above examples. The benefit of this is clear, the individual does not own the asset, but rather the trust does. The individual however, does control it.

During the situation of a lawsuit, a person with a trust does not bear any potential loss or risk that a company structure and individual ownership do. The only caveat is that you must know what trust is right for you for many reasons including tax effectiveness; whether you’re a business or on your own will have a lot to do with this.

What about insurance?

Many individuals mistake asset protection for insurance and make the fatal mistake of choosing one over the other. The truth is, both supplement each other and are mandatory. Having insurance provides many benefits towards asset protection including legal fee assistance, funds to settle lawsuits and so on.

Now that you’re aware of the main forms of ownership in relation to protecting your assets, you can judge your situation and make an informed decision. Contact us to discuss your investment options.

The 5 tips in this article are foundational life lessons of those who have crossed the property investing path before:

Head over heart

Like poker players, experienced property investors all know to leave their emotions at the door. This is not a home that they’re buying for their three children and wife, this is a vehicle through which they intend to make money with.

If you’re a beginner reading this, your tendency will be to go with your emotions because of the thrill, which is why you must internalise this lesson and take it with you to avoid that trap.

Listen to others

At the end of the day, the decision is yours to choose which property you want to invest in. However, although this is true, getting several third party opinions can go a long way for many reasons. Like the above tip, emotions can get in the way of rational decisions, which is why getting a logical third party opinion can help in giving you perspective.

Despite your experience or lack thereof, there is almost always one or two things your investor buddies know that you dont, which is why it’s essential to gain this birds eye perspective. If you are a beginner, this tip should go without saying.

Building inspection

One mistake that is unfortunately prevalent is not having a building inspection. Experienced investors realise that this mandatory in order to avoid any unexpected expenses down the road. Aside from this, you do not want your tenants giving you a hard time for any hidden faults or insects crawling around once they move in.

It’s a business

There is a misconception that investing is a “side-gig” towards your real job and that it should be treated as such; this is a mindset that will lead you to failure. Whether this is your only source or just a side source of income, you need to treat investing like you would treat your own business.

This means that the activities conducted by you should involve standard business procedures like setting up financing, protection, relationships with other smart investors and so on. Like everything in life, you get out what you put in, and unfortunately you’re at risk of losing a lot of capital if you treat this with little regard.

Long term > short term

Many people are overly dramatic about the short term fluctuations in investing, and how to seize them. The problem is that these are quite unreliable and very volatile. On the other hand, long term charts provide a very good scope of statistics that are much more proven to be profitable if followed.

In terms of property investing, going in for the long haul is much smarter than short term gains. Of course, there are situations and people who profit of the latter, though for the general public it’s much like gambling.

So remember, if you’re just beginning in the world of investing, you could save years of heartache and pain by learning from others mistakes instead of making them yourself. To get started on your investment journey, contact us today!

The benefit of this method is purely financial, the investors return on rent is in direct proportion to their fraction of the property. Many individuals do not have the means to make such large investments in properties, and as a result use fractional investment as an alternative.

Low start up fees

With fractional investing, you can literally start with as low as $75 and own part of a property. Although this is a low entry, you do miss out on some of the benefits that traditional investing involves. Factors such as in person inspections are not included with low investments, rather you just gain a slice of the returns.

It’s no surprise that with the opportunity of low risk, fractional investing is attracting a lot of young people. With the Australian market as expensive as it is, this form of investing targets a very large market of people who desire to put their money to good use, but cannot afford absurd prices or don’t want to take massive risks.

Where to find fractional investing platforms

Like other forms of investing, there are different mediums through which you can operate to succeed in fractional investing. BrickX and DomaCom are two of the main companies in Australia that allow you to invest in fractions with there own unique advantages.

BrickX

With a minimum requirement of only $100, the BrickX online service allows you to buy “Bricks” in a unit trust. Bricks as labeled by the company allow the individual holder to receive returns in proportion to their investment, they can be compared to shares. The notable benefit of this being is that there is no minimum holding and the investor is able to list there bricks for sale whenever they want.

DomaCom

With a Managed Investment Scheme structure, Domacom allows investors to invest in properties using not only fractional, but crowd funding methods also. The company has quite a low minimum entry at $75 and is regulated as a managed fund. One of the unique aspects of this company is that they offer a bookbuild process that allows investors to collect their funds together and invest in any of the hot properties in Australia.

With the Australian property market still showing high prices and not giving any signs of reversing as of yet, fractional investing has nowhere to go but up. Society at large and young people in general can barely afford the demands of the market, let alone spending their money on a full property for the purposes of investing. Fractional property investing is just beginning in terms of its popularity, and may be the next mainstream way for Australians to invest. Keen to know more about fractional investing? Contact us today.

Units

Compared to houses, units tend to be smaller abodes, with smaller rooms and less private open space. They may be stand alone (i.e. detached), or they may have common walls with abutting dwellings (i.e. semi-detached), and may also have shared space for driveways and parking.

Once the domain of the pensioner or downsizer, units (aka apartments, condos, and plexes) are now popular to the point of becoming mainstream for these three reasons:

1. Affordability

In general, in any given suburb, a unit will be cheaper than a house. This will be because it is a smaller sized building with more compact bedrooms and living areas, but more importantly, because it has less land.

As mentioned, having to put up with small used to be seen as a compromise. Not so much anymore. Smaller now means less cost (i.e. rates, utilities, etc.) and less effort to maintain (i.e. cleaning, garden, repairs, etc.).

2. Convenience

While apartment living has always been a necessity in population dense cities like London and New York, and in places like Europe, Australia was urbanised on the back of a “house in the suburbs on a quarter acre”, and a commute (usually via public transport) to the city for work.

Yet, as travel times increased, and as the amenities in city areas improved, the CBD area has morphed from a place to work and be entertained, to a place to live and work and be entertained. For some, the convenience of walking to the office and access to superior amenities such as restaurants, entertainment, transport, etc. have outstripped the benefits of a traditional house in the ‘burbs and a long commute on a congested freeway to work.

Furthermore, as mentioned, while seen as odd by past generations of Australians, unit living is the norm in many Asian and European countries where space is in short supply. Without any prejudice, immigrants see nothing unusual about living in the same type of (compact) accommodation as is the norm in their country of origin.

3. Yield

For investors, compared to houses, units generally provide a better income return. That is, despite needing to accept a lower rent compared to what could be achieved owning a house, investors are more than compensated with a cheaper purchase price so that when the numbers are crunched, it is usual for a unit to have a higher percentage gross return (i.e. annual rent divided by purchase price) than a nearby house.

Houses

To qualify as a house, the dwelling normally has to be on its own title and have no shared or common area, including walls, driveways, etc. Houses are usually larger than units – both in respect to room size and the amount of private open space.

As mentioned, for many generations past and present, the Great Aussie Dream was to own your own house, which was typically on a substantial parcel of land (such as the classic quarter acre which is a little over 1,000 square metres). While land sizes have diminished (most new houses today come on land parcels of 500 square metres, or less), houses remain the pinnacle of home ownership for those who like their space, are raising a family, and/or who prefer not to be living a wall away (i.e. a few metres) from their neighbours.

Which Is The Better Investment?

Consider this conundrum: you can either buy an older 2-bedroom house for $500,000 in suburb Y, or a new 3-bedroom unit in the same suburb. Which should you choose?

As we flesh out an answer, here’s a general investing principle to remember:

You are better off purchasing the worst house in the best suburb you can afford, than the best house in the worst suburb you can bear living in.

Have you heard the saying “Land appreciates while houses depreciate”? It’s true. What makes a dwelling more valuable is not the bricks and sticks it is made from, which will deteriorate over time and require maintenance, but rather its land size and proximity to appealing amenities. This is sometimes paraphrased as “location, location, location”, but that is only partly true. For land to be valuable it must be usable and it must be scarce; land that is not usable or scarce is unlikely to be a good investment.

The principle mentioned above captures the reality that a bad house on good land will be a better investment than a good house on bad land.

Another general principle to remember is:

Buy the best-worst house you can afford rather than the worst-best unit.

In other words, dollar-for-dollar you are better off buying a run down house in your chosen location than a spruced up unit. Why? Because over time the land will become more valuable (as it comes more scarce) whereas the unit will depreciate in appeal as it suffers wear and tear from use.

It is true that your rental yield will probably be lower for the house, but whatever you miss out on in income should be well and truly made up for in extra capital appreciation over time.

These two points made, you may be faced with limited deposit capital and/or borrowing ability. If so, then a unit can still be a smart investment if it helps you get in the property market, rather than having to watch on the sidelines as property prices increase faster than your ability to save.

If you are considering purchasing a unit, then here are four recommendations to remember:

Buy old, not new. Older units are usually bigger, and you won’t pay a premium for shiny and new which is only temporary anyway.

Don’t get attached. The less attached a unit is, the better. If possible, avoid common walls abutting living areas.

Less is better. The fewer units on (or in) the block, the better. The more dwellings there are, the less scarcity there is, and the more cramped the living conditions, and the less land that would be “yours”.

Aim high, or low, not middle. You are better off with a ground floor unit (for convenience), or a high floor unit (for the view), rather than being in the middle with the masses.

To conclude, data that tracks rental yields and movements in median dwelling prices over time indicates that while units deliver a better rental yield than houses, houses outperform in terms of capital appreciation. Given Australia is largely a growth (rather than income) property market, you’re better off with a house than a unit, and better off with a unit than nothing at all.

Source:

https://www.propertyinvesting.com/units-houses-make-better-investments/

In reality, Australia’s residential investment market is dominated by people who, having bought their own home, have moved onto buying an investment property. These small-scale investors own 83 per cent of all investment properties.

Previous research shows that real estate investors tend to be married, wealthy males with high income and full-time employment.

A typical rental housing investor is a high-income earner or family partnership, owning one or two dwellings as an extra income source. The probability of becoming a residential investor tends to increase with age and homeowner status, but declines after the age of 65.

With home ownership rates in Australia at around 70 per cent, the Australian Bureau of Statistics (ABS) reports that residential investment represents, on average, 35 per cent of all housing finance, while the rest are all owner-occupiers. This means residential investment is an important part of the mortgage market and banking system.

Most residential investment is centred around rent or resale; only a small proportion goes on construction of new homes. And residential investment by corporations or big companies represents only 8 per cent of the market.

Private data from a major mortgage provider used in my research (for the period 2003-09) reveals what the typical real estate investor looks like. They are on average 42 years old, 72 per cent are married, and fewer than two-thirds of investors get finance with a co-borrower. Only a third of investors are female.

According to the same data, residential investors have an average net monthly income of $8,600, or $103,200 a year. But if we exclude the 100 investors with a net monthly income over $100,000, the average net monthly income becomes $6,617, or $79,404 a year.

Residential investors, financing the property with a mortgage, have on average $934,091 in net wealth (50 per cent of investors have $581,541 in net wealth). Some of them have diverse portfolios; six sources of investors also own shares with an average value of $4,884.

The data also show that direct residential investors are mainly professionals, in management positions, small business-owners, or workers with a skilled trade. Overall, 27 per cent are self-employed, relative to the 19 per cent of self-employed owner-occupiers.

Where they invest

The data reveal that direct residential investors invest mainly on existing houses, as do owner-occupiers when buying a property. The ABS reports only 3 per cent of investors’ financial commitments are destined for construction of new dwellings.

Our data shows that residential investors are more willing to invest interstate or in a different postcode than owner-occupiers. While almost half of residential investors invest in a property located in a different postcode to where they live, 11 per cent of residential investors buy properties in states other than the state where they live.

Most residential investors choose rural and regional areas to invest. Many residential investors choose to buy property in big metropolitan cities like Sydney and Melbourne.

However, the top 10 postcodes chosen by residential investors to buy property (between 2003 and 2009) include Cairns (QLD), Mandurah (WA), Torquay (VIC), Mackay (QLD) and Launceston (TAS).

Why do they invest?

Our research shows the main reasons for accessing finance to buy a house, other than to live in it, are income and wealth accumulation.

Some investors invest because they see it as a long-term, secure, “bricks and mortar” investment. To these investors other types of assets (such as shares and bonds) may seem harder to understand and it may be more costly to enter these markets.

A proportion of real estate investors see it as a source of permanent income, while others speculate on the potential capital gains in real estate and invest expecting to increase their wealth.

This reason becomes more prominent during periods of strong house price appreciation. For example, between 2003 and 2009 year-to-year average house price inflation has been 8.9 per cent.

Academics have also argued that the Australian taxation system motivates — rather than facilitates — housing investment, as investors are able to access 50 per cent deduction on capital gains and negative gearing. Another motivator to invest in real estate may be more mortgage finance access; for example, between 2003 and 2009 the average 12-month housing credit growth has been of 14.6 per cent.

Of course there are other reasons to invest, such as moving up or down and maintaining other property as an investment, or getting a holiday home and keeping it as an investment too. There are also “unintentional” real estate investors that may have inherited or acquired property.

Most residential investors are your average Australians, who invest in rural or regional areas as a secondary source of income and to gain equity. So when thinking about who is the typical Australian retail investor, you could probably look at your neighbour.

Source: http://www.abc.net.au/news/2017-08-01/who-is-the-typical-investor-in-the-australian-property-market/8764504

The difference is usually in the timing.

I’m not talking about timing of the market where you buy at the bottom and sell at the top, (as if you can ever accurately pick those times anyway). No, I’m talking about you and the time you are right to move from investing to speculating.

You see, there is a significant difference between investing and speculating and to understand what I mean by that I think it’s instructive to look at the definition of each one.

According to Investopedia.com

“Speculation is the act of trading in an asset or conducting a short term financial transaction that has a significant risk of losing most or all of the initial outlay with the expectation of a substantial gain.”

While investing is defined as;

“Investing is the act of committing money or capital to a long term endeavour such as real estate with the expectation of obtaining an additional income or profit.”

One method has high risk attached to it and the other is a measured, long term approach to making money. Each method can make you money, no question about it. Looking at it another way we can say that your risk level will decide which way you will invest.

Searching for big profits quickly falls into the speculative camp while investing for the long term falls into the investor category. Again, both types can make money but the risk of losing it goes up with the level of speculation involved.

At CPS Property we want all of our clients to be better off after they have seen us. For most people this means that they are either new to investing or need more education in the fundamentals of property investing.

To fulfil this need we created our CPS Methodology and Asset allocation which is used to identify potential growth suburbs and to select the right property at the right price in the right location.

A long term investor will work their way towards a property portfolio using the same basic fundamentals each time. This type of methodology provides consistent results over the long term and is symptomatic of a systematic approach to successful investing.

By applying the key criteria we identified suburbs that our competitors weren’t recommending which made us pioneers if you like. Not everybody agreed with our selections but the interpretation of the data was very clear.

Even today, I still remember a potential client handing back a contract for a 1 bedroom Studio in Surry Hills priced at $420k because they thought there wouldn’t be any growth in that area after the GFC – I should mention that the same property is now selling in Surry Hills is $750K, just on 5 years later.

Naturally, we have identified other suburbs with similar results so we have no problem applying the CPS Methodology to locate new opportunities.

It’s worth pointing out that the CPS methodology cannot be used to identify opportunities for speculators. It utilizes data that can be interpreted for long term investment, reducing the risk to our clients. It’s a serious long term solution to investing in property.

Another difference between the two investor types is an Investor can benefit from the advice of a Financial Planner. Long term low risk investments fit nicely into a Financial Plan. After all, a Financial Plan is looking to get the result you are looking for, over a given time frame, and in line with your risk profile. It would be difficult, to say the least, to design a Plan that incorporates high risk, short term investments and still be confident of success.

The fundamentals we apply for our clients are designed to provide an acceptable level of risk in conjunction with an achievable Plan using a property that fits our methodology.

We also like to educate investors on how they can improve by reviewing their current property portfolio and borrowing position. Listening to the noise in the media and avoiding educating yourself is a sure way to create confusion.

Given that this is the message we have been preaching since 2005 there is little reason to change a successful formula.

Jacob O’Neill

Principal.   

What is a dual occupancy property?

A dual occupancy property offers two incomes to an investor by way of two separate living spaces and therefore two tenancy opportunities. Common examples of a dual occupancy property include a granny flat, duplex or dual-key property. Although these property types all have the potential for rental income, there are various differences between them which will affect investors.

Different types of dual occupancy properties

• Granny flats: typically the size of a studio or one bedroom apartment and located to the rear of an existing, larger property. Generally speaking, a granny flat will require council approval before building the property, as well as being allowed to accept tenants into the property.
• Duplex: two properties which are adjoined or share common walls, such as a house divided into two separate properties, and can therefore be sold separately.
• Dual occupancy: not too dissimilar to duplexes, dual occupancy properties share common land but do not have to be adjoining or share common walls.
• Dual-key property: typically one property with a shared front entrance door and hallway and potentially additional living spaces such as the kitchen and living room. However there is a section within the property which is locked and rented out to a separate tenant, for instance a bedroom and ensuite.

The benefits of dual occupancy properties

There are several benefits of dual occupancy investment properties. The main factor being the ability to maximise the potential of one block of land. Essentially this means improved cash flow and reduced maintenance costs. Furthermore, they are a smart decision for investors looking to grow and diversify their property portfolio.

Source: build, 2016: http://www.build.com.au/blog/5487

A dual occupancy property delivers a superior cash flow and therefore allows an investor the opportunity to pay off their mortgage at a faster pace.

To discuss your dual-occupancy  investment options, contact CPS Finance today.

We take a retrospective look at median dwelling values across the suburbs of Australia to show the deterioration of more affordable housing across the capital cities.

A retrospective look at median dwelling values across the suburbs of Australia shows the bracket creep that has occurred over the current growth cycle, highlighting the deterioration of more affordable housing across the capital cities over the past five years.

At the end of 2016, 7.6% of suburbs nationally had a median house value under $200,000 and 5.9% of suburbs had a median unit value below $200,000.  To put these figures into some perspective, 11.4% of suburbs had a median house value of at least $1 million and 3.0% of suburbs had a median unit value of at least $1 million.

Over the five years to the end of 2016, there has been a substantial decline in the proportion of suburbs with a median value below $400,000.  At the end of 2011, 53.5% of suburbs had a median house value of less than $400,000 and 69.8% of suburbs had a median unit value of less than $400,000.  By the end of 2016, the proportion of suburbs with a median value of less than $400,000 had fallen to 41.0% for houses and 55.3% for units.

Suburb median values by value range,

National, December of each year

A five year retrospective look at the individual capital cities highlights the significant shift in the proportion of suburbs with a median value under $400,000, particularly in Sydney and Melbourne.

In 2011, the proportion of total suburbs with a median house value below $400,000 across each capital city was: 21.2% in Sydney, 28.9% in Melbourne, 40.9% in Brisbane, 40.5% in Adelaide, 31.1% in Perth, 69.2% in Hobart, 2.1% in Darwin and 1.1% in Canberra.  Units offer a more affordable option highlighted by the proportions of suburbs values below $400,000 at: 38.8% in Sydney, 48.2% in Melbourne, 81.7% in Brisbane, 94.3% in Adelaide, 59.8% in Perth, 92.7% in Hobart, 53.3% in Darwin and 44.6% in Canberra.

Suburb median values by value range,

Capital cities, December 2011

By 2015, the proportion of suburbs with a median house value below $400,000 had shifted to: 1.2% in Sydney, 12.2% for Melbourne, 31.4% in Brisbane, 29.5% in Adelaide, 15.5% in Perth, 55.7% in Hobart and 0.0% in both Darwin and Canberra.  For units, the proportion of suburbs with a median value of less than $400,000 in December 2015 were recorded at: 10.9% in Sydney, 34.9% in Melbourne, 64.4% in Brisbane, 87.7% in Adelaide, 37.2% in Perth, 88.4% in Hobart, 51.4% in Darwin and 50.5% in Canberra.

Suburb median values by value range,

Capital cities, December 2015

The proportion of suburbs with a median house value of less than $400,000 at the end of 2016 was recorded at: 0.1% in Sydney, 6.3% in Melbourne, 29.2% in Brisbane, 28.0% in Adelaide, 18.9% in Perth, 52.1% in Hobart and 0.0% in Darwin and Canberra.  For units the proportions were recorded at: 6.5% in Sydney, 31.8% in Melbourne, 62.7% in Brisbane, 85.1% in Adelaide, 46.4% in Perth, 88.4% in Hobart, 57.6% in Darwin and 45.8% in Canberra.

Suburb median values by value range,

Capital cities, December 2016

Five years ago every capital city except for Darwin and Canberra had at least 20% of suburbs with a median house value of less than $400,000.  At the end of last year, it was virtually impossible to find houses for less than $400,000 in Sydney, Darwin and Canberra while less than 7% of suburbs had a median house value below $400,000 in Melbourne.  Across each city there has been a substantial decline in more affordable housing over the past year despite the fact that outside of Sydney and Melbourne there has been only moderate value growth over the period.

Even units have recorded a fairly substantial decline in the proportion of suburbs with a median value of less than $400,000 over the past five years.

At the end of 2016, looking at both houses and units, 20.5% of Sydney suburbs had a median value of less than $600,000 compared to 38.5% of suburbs having a median value of at least $1 million.  To further highlight deteriorating housing affordability in Sydney, 34.6% of suburbs had a median unit value of less than $600,000 at the end of 2016.  In each other capital city, a higher proportion of suburbs had a median house value of less than $600,000 than the proportion of suburbs with a median unit value of less than $600,000.

If you’re interested in starting or growing your property portfolio, contact CPS Property today.

Investing in purpose built student accommodation allows you as an investor the opportunity to participate in Australia’s largest non-resource export sector, Tertiary and Further Education. The benefit of this hugely rare opportunity is it’s highly resilient nature to economic instability.

There has been significant growth in tertiary enrolments in Australia over the last decade, against the ongoing backdrop of chronic undersupply of purpose built student accommodation. In turn this provides the potential for high occupancy rates and growing returns.

Located in Australia’s most popular destinations for tertiary students, investors will be attracted by the combination of significant annuity-style income together with the potential for capital growth.

What you need to know about this investment opportunity:

•       Asset backed, strong yielding investor returns
•       Anticipated IRR 15% to 18% p.a. net of fees (comprising yield and capital growth)
•       Targeted initial cash yield of 10.5%+ p.a. (once fully operational) payable quarterly, rising to 13.0%+   p.a. from year 3 onwards
•       Significant tax deferred component
•       Prime CBD locations close to Universities, transport and amenities
•       Investment term between 3-7 years with compelling exit opportunities

If you’d like to discuss student accommodation as your next strategic investment purchase, contact CPS Finance today.