‘Not for Newbies’: NDIS Housing Can Be Profitable
‘Steep learning curve’ for NDIS housing investors’
But this isn’t an asset class suitable for your typical residential property investor.
“It’s not a game for newbies; there’s a very steep learning curve,” Professor Beer said, adding that investors in SDA housing typically invest time to learn about the sector’s specific requirements and compliance guidelines.
This is certainly the case among potential buyers for Westpeak Residential Services, a supported facility in the Geelong suburb of Belmont in Victoria, for sale as part of Burgess Rawson’s June portfolio auction.
“Interest has been steady from all types, but most interest is coming from those who already own such a facility,” Burgess Rawson partner Raoul Holderhead said.
The property comes with a renewed 10-year lease to 2032 to a residential service provider, with options to 2037. It has 37 rooms and can house up to 42 residents, with tenants paying all outgoings. Mr Holderhead said he expects to see a lot more investor interest in the SDA housing sector.
“Long leases and given the ongoing housing crisis plus higher living costs, I think the almost-certain longevity of this type of business will appeal to more investors who can see the long-term benefits.”
CBRE announced in May it would be offering two SDA apartment buildings for lease in Sunshine and Greensborough, north of Melbourne. Both are expected to attract close to $1,000,000 in annual rental. CBRE’s director of healthcare and social infrastructure Sandro Peluso said the interest in the sector is strong.
“We have a growing number of new entrants contacting our team almost weekly. We expect investor interest in SDA housing to almost double by this time next year.”