The Australian Government is bridging the gap in the supply of Specialist Disability Accommodation (SDA) by granting investors financial initiatives to develop dwellings that handicapped people sorely need through the National Disability Insurance Scheme. Investing in NDIS has a significant and long-term influence on the community and the lives of people with disability. Participants in the National Disability Insurance Scheme (NDIS) who are able to live in a home that is completely equipped to meet their needs will reap incalculable benefits. Funding the cost of specialist disability accommodation is a key area supported by the NDIS for people living with a disability. Specialist Disability Accommodation (SDA) is an important component in fulfilling these essential needs. This sector is also proving to be a potential boon for investors.
However, there are some perks that can be valued. We look at some of the financial advantages/benefits of a NDIS/SDA property.
Risk mitigated property investment
The investment risk is greatly decreased because the federal government pays a significant share of the through SDA funding. SDA housing is supported by government assets, which are considered the safest sort of investment; the entire plan is risk free. The government is dedicated to placing NDIS participants in appropriate housing for the next 20 years, which is why it has pledged to fund SDA home. For investors, this implies that SDA payments are guaranteed for 20 years by the Australian Government, with the possibility of an extension.
High returns
Using conservative rental yield estimates, you could expect to generate a high rental income of more than $100,000 per year. You can just consider what you could accomplish if you had an extra $100,000 each year. Like the cherry on the top, the rent is tied to the Consumer Price Index (CPI), your rental income will climb in lockstep with inflation each year.
NDIS property Investing could help you:
- Pay off your home loan without any hassle: Forget about paying off your mortgage over the course of 30 years! With a NDIS investment property yielding a high annual return, you might pay off your debt in a matter of years.
- Save for retirement: By purchasing NDIS properties inside an SMSF, you can take advantage of concessional tax rates and accumulate money ready to fund your retirement. Alternatively, if you want to retire early, buying an SDA investment property outside of super could provide adequate income flow to sustain your lifestyle without having to meet a condition of release, as you would if the project was super.
- Put your family on the path to financial independence: Most people dream of financial freedom. This unique investment opportunity may offer the tools you need to reach financial freedom for not only yourself but for future generations to come.
Low risk of vacancy
When investing in property, the risk of vacancy is a nightmare for many property owners. It is a crippling experience for investors to have their homes stay idle while they pay their mortgage, and insurance charges. As there is a very huge demand for specialized disability housing there it is drastically under supplied, so the vacancy risk is very low. The investors don’t have to worry if a tenant moves for whatever reason, there is almost a sure chance that somebody will be moving in soon after. There’s always a little risk even for NDIS Property Investors, so keeping this in mind; the government has sought to mitigate this risk by providing rental guarantees.
If a tenant decides to move out for whatever reason, chances are someone else will be moving in soon after. Like the risk in all property investors, even NDIS property investors have some risk of vacancy (but the risk is far less in NDIS Property Investors than in other property investors). Keeping this in mind, the Australian government has sought to mitigate this risk by providing rental guarantees.
The Government has come up with a guideline. If a NDIS property is left vacant for more than 60 days without a tenant, the government will cover the rent for up to 90 days for houses with two or three rooms and up to 60 days for houses with four or five rooms. This is a benefit you won’t find by investing in regular property. Once a disabled person finds a home that is specially designed for the participants’ needs, there is a huge chance that they will be living in the same place as long as possible. Thus, it is safe to say, people with disability are generally long-term tenants.
*Not only for investors, but also for NDIS participants, families, and carers, the advent ages of investing in NDIS property are numerous and long-lasting.
Please don’t hesitate to contact us if you want to know more about SDA properties.