Choosing the right investments for your portfolio takes more than guesswork. Similarly, when choosing a location for an NDIS investment property, careful selection can make your investment more meaningful in financial return and in the lives of the NDIS participants requiring SDA housing.
We discuss why location is a key factor in NDIS property investment and how property investors can use the NDIS demand map to their advantage.
What is NDIS housing?
When the Australian government introduced the National Disability Insurance Scheme (NDIS), it recognised the serious lack of suitable accommodation for Australians with disability. Without specialised housing, many Aussies are left with no option but to enter aged care facilities — some as young as their 20’s!
Specialist Disability Accommodation (SDA) was created to address the critical need for suitable accommodation for those with extreme functional impairment and very high support needs. To encourage social participation, the Federal Government has opened the opportunity for everyday Aussies to invest in NDIS homes, providing up to $700M annually to SDA providers. What this means for property investors is a widening in their investment options outside of a standard investment property, that provides strong rental yields while maintaining capital growth potential!
How many NDIS participants require specialist disability accommodation?
Participants in the NDIS looking for an NDIS SDA property reside Australia-wide. Understanding the locations NDIS participants are seeking can offer housing providers guidance as to where suitable specialist disability accommodation is required most.
There are currently thousands of Australians who have been identified as requiring SDA housing. Most either have funding and are searching for an appropriate SDA home, are seeking an alternative SDA home or awaiting SDA funding in their NDIS plan after completing the SDA housing assessment.
The different SDA properties available for NDIS approved tenants
The SDA scheme outlays four distinct categories of SDA homes to provide special disability accommodation with different provisions, depending on the participant needs.
The four SDA design categories are:
- Improved Liveability
- Robust
- High physical support
- Fully accessible
Depending on the design standard that applies to the property, there are different property requirements. For example, a Robust SDA dwelling is not appropriate in a high-density, multi-level building, instead requiring a larger parcel of land in an area best suited for areas with low populations.
The design standard provides clarity to housing providers (such as investors) on the requirements of each home and the flexibility to respond to participant needs. Also able to assist investors in SDA dwellings is a new data analytics tool known as the NDIS demand map.
Using the NDIS demand map
Those looking to build or purchase approved SDA housing often look to new NDIS data to guide their decision on the most meaningful location and SDA design to provide. Most investors inevitably want to ensure that the property meets their financial objectives.
The government’s NDIS website provides SDA demand data via a demand map, which provides up-to-date information and data on the number of SDA participants requiring SDA homes. The map can be viewed as a spreadsheet or geographical map and allows website users to filter results across reported ranges, including via postcode or multiple postcodes.
Accessing professional guidance on investment in the National Disability Insurance Scheme
Location is a critical factor in NDIS investment, as the SDA market operates entirely differently from the residential property market. Understanding the existing demand for NDIS properties across various locations guides the type of building or land package to choose and helps ensure that your property can meet participant needs.
In turn, selecting the right location for today’s demand while considering future participant numbers can lend itself to long-term rental income and help support the ongoing capital growth potential of your next property portfolio addition.
Investing in the NDIS sector does come with its own set of unique requirements. Whether it be understanding how the reasonable rent contribution is calculated or needing to engage a specialist property management firm, accessing professional assistance from the start can ensure you cover all of your requirements. Let NDIS loan experts help you lay the correct financial foundation to build a successful benevolent investment.
