We’re always on the lookout for great properties to beef up our client’s property portfolios and during a recent trip to Melbourne I found a project like I’ve never seen before, the incentives, aka guarantees offered just blew me away. This housing estate is located in Melbourne’s west, which is in its early stages of massive growth, think Leppington or Marsden Park in Sydney 5 years ago. It’s a great opportunity to jump on in the early stages of the project and take advantage of future growth. The proof is in the pudding when a Westfields Shopping Centre is opening 7 mins away.

Let me run through the guarantees with you.

Rental Guarantee
The developer’s agreed to guarantee the rental return for 3 years, so essentially if you’re without a tenant for any period of time during the 3 years, the developer will pay your rent. In addition to that, if you have to reduce your rent below the guaranteed return, the developer will pay the difference.

20 Year Structural Guarantee
These properties are house and land and the builder’s offering a 20 year structural guarantee. You know the builder’s not going to shortcut the structural guarantee of the property with dodgy building practices as it can cost a lot of money to fix later.

5 Year Future Value Guarantee
Never have I ever seen such an offer from any developer where they guarantee the future value of a property. The developer is guaranteeing that in 5 years your property will increase in value and if it doesn’t, they will buy the property back from you at the price you paid for it.

The estate already has an award winning golf course, a beautiful homestead, schools being built and sporting and community spaces in the works, it’s truly amazing.

Putting all the beauty aside, if you look at it from an investment opportunity there’s absolutely no risk to you. If in 5 years you don’t like the property you can sell it back to the developer, the only cost to you would be the stamp duty that you pay on the land, which may be something like $13,000 out of your own pocket.

Is the developer crazy for offering such discounts? No, the developer is one of the biggest builders in Victoria and he’s smart enough to realise that he needs to offer guarantees for people to feel comfortable to invest in the current market conditions.

There’s risk in anything you do in life, especially investing, however, the important thing here is how you manage that risk, arming yourself with all the information for both sides of the story to make an informed decision.

“The biggest risk is not taking any risk… In a world that is changing really quickly, the only strategy that is guaranteed to fail is not taking risks.” – Mark Zuckerberg

Thank you for reading