For any investor, the objective is generally to achieve a return on their investment. Depending on your unique investment goals, your strategy may target one of the two basic investment fundamentals: cash flow from the investment or an appreciation in the investment’s value over time. What if we told you that an NDIS investment property provides opportunities for a high rate of return in both capital growth and income yield?
Let us walk you through how below.
The best strategy for property investment
Every property investor’s strategy will mean something different depending on their investment objectives.
Rental yield strategy
Investing with an income focus means placing the asset’s value over time on the back burner and instead focusing on an investment that will provide your portfolio with solid, consistent income. Property investment is no different — some property investors look to source properties that attract consistent rental income. Property management firms are adept at working with these types of investors to draw reliable and secure tenants to solidify rental yields.
The cash flow from your investment choices can either lead to your investment being positively geared or negatively geared.
Capital growth strategy
Investment strategies that focus more on the asset’s future value are generally based around targeting assets with strong capital growth potential. Property, shares and infrastructure are typically considered to be long-term investments, meaning that the focus is on achieving a positive return in the long run.
Investors with an extensive property portfolio may choose to diversify and invest in some properties at an attractive price, to sell in favourable market conditions, and others to focus on only rental income.
The benefits of NDIS property investment
Specialist disability accommodation is unique for many reasons. First and foremost, SDA homes offer the opportunity for Australians living with disability to find housing that is purpose-built to their needs. For Aussies with extreme functional impairment or very high support needs, NDIS homes are specially designed and provide a level of independence otherwise unachievable in the standard housing market.
High rental income
With the Australian government pledging up to $700 million per year to specialist disability accommodation for the next twenty years, the rental yield achievable for SDA homes can be as high as 10-20% per year. Due to the high demand for SDA properties and the property configuration, investors can access rental income backed by SDA funding from multiple tenants simultaneously.
Capital growth opportunity
People living with disability are all over Australia. As a property investor, this allows you to source properties or land packages in any location. The SDA design categories that apply to an NDIS home mean that the property types and prices are unique and operate in a different market than the traditional residential or commercial property markets.
This means that SDA homes are uncorrelated to other properties in your property portfolio. You can also take advantage of government-secured funding programs to ensure that your property holds strong capital growth potential over the long term.
The SDA program is particularly effective in helping NDIS participants in regional areas access suitable housing while encouraging private investment into communities that property investors may otherwise overlook.
How to borrow money to invest in an NDIS property
If you want to leverage the security of the National Disability Insurance Scheme to purchase an SDA home but require funding, NDIS loan experts can help. Our team specialise in sourcing funding solutions for investors who want to build their wealth while improving the quality of life for members of the Australian community.
Reach out to our team to understand your funding options.
