Half seriously looking at a 1 bedroom property in the guts of Sydney as an investment. Deceased estate (public trustee), the entire place needs to be gutted and re-done ($80K). Going to auction with an estimate of $250K+. chances are this is an underestimate to drive interest.
Renovated 1 bedroom properties in surrounding areas are in the ~$400K price range.
The property is Company Title rather than Strata Title. Now I understand that Company Title can scare potential buyers away; thus your market is limited.
From my limited understanding, the negatives of company title include;
-You don't own the property, you own shares in the company who owns the property.
-Banks will generally lend less as the security is shares in company rather than property.
-(Not sure about this one) Can't claim depreciation as the company owns the property, not you
-Company can deny potential tenants / buyers
One benefit I see is that if the Company Title is converted to a Strata Title this could have a 10%+ benefit to unit prices. I am aware that zoning, building checks, DAs etc need to be paid for to change from Company Title to Strata Title. I am also aware that 100% of Company Share holders need to be in agreement to change to Strata.
Can anyone give a % figure on how much a Company Title may reduce a property price? Eg. if the same property was sold as Strata Title, what kind of % difference would there be?
Any words of wisdom, warning about strata titles?
From my readings thus far; common perception is to avoid it like the plague! But could this fact be a potential benefit?
Might be worth mentioning. There are currently about 4 of the nits being rented/used as commercial. Mainly Solicitors and also a couple of Acu-Puncture/Chinese medicine. So a benfit could be that this property could be rented as either commercial or residential. Quite a unique opportunity I would think.