A new real estate investment opportunity has emerged in Port Augusta, with four newly constructed homes now on sale. These properties come with a state government leaseback arrangement for essential workers at attractive rates and are backed by a secure, long-term partnership. The homes are part of a government initiative aimed at addressing housing shortages in regional areas and attracting key workers to the region.
The homes, which include two- and three-bedroom units, are the first properties completed under the Regional Key Worker Housing Scheme. Managed by Renewal SA’s Office for Regional Housing, these properties are leased to the Department for Infrastructure and Transport’s Government Employee Housing division. This ensures that the homes will be occupied by healthcare workers, law enforcement officers, educators, and other essential service personnel in the area.
Key Features of the Opportunity:
Government-Backed Lease Agreement: The state government guarantees a lease to the Department for Infrastructure and Transport’s Government Employee Housing division, ensuring stable, long-term tenants for at least 10 years, with the option for a five-year extension. This arrangement provides a secure income stream for investors.
Guaranteed Rent: Rent for the properties is guaranteed by the state government for the entire 10-year lease term, starting at $465 per week for the two-bedroom homes and $600 per week for the three-bedroom homes. These rents will be subject to a 2.5% annual increase and periodic reviews to align with market conditions. In the event of vacancies, the government will continue to honor the lease payments.
Maintenance and Support: The state government will also provide ongoing maintenance for the homes, ensuring they remain in good condition throughout the lease period. This reduces the operational risks and responsibilities for the investor.
Growing Investment Pipeline: These four homes are the first of 30 properties across South Australia to be made available under the pilot phase of the Regional Key Worker Housing Scheme. As additional properties are completed, further investment opportunities will become available. This growing pipeline is expected to attract significant interest from investors looking to benefit from the government’s secure, long-term arrangements.
Investment Benefits:
De-Risked Investment: As noted by Matt Hunt, Director of the Office for Regional Housing, this opportunity offers a de-risked investment model for those looking to invest in residential properties. With guaranteed rent payments, the investor’s exposure to market volatility and tenant turnover is significantly reduced.
Stable and Growing Demand: The Port Augusta properties are part of a broader effort to address the critical shortage of regional housing across South Australia. As essential workers increasingly seek accommodation in regional areas, the demand for rental properties, particularly those backed by government leases, is expected to grow.
Strategic Social Impact: Investors participating in this program will also contribute to alleviating the housing shortage for essential workers, helping to improve the quality of life in regional South Australia while benefiting from a stable income stream.
Final Thoughts:
This unique real estate opportunity offers investors the chance to secure a stable, long-term income from government-backed tenants in a region with high demand for housing. As a part of the South Australian government’s broader strategy to attract and retain essential workers, these homes present a promising avenue for those looking to invest in regional properties with a low-risk profile and attractive returns.
Interested parties are encouraged to act quickly, as demand for this opportunity is expected to be high, and more opportunities are set to be rolled out across South Australia in the coming months.
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