Why NDIS SDA’s are strong and reliable investment properties in Australia

In this article, we will explore why NDIS SDA’s are strong and reliable investment properties in Australia. The National Disability Insurance Scheme (NDIS) is a government-initiated program aimed at providing support, services, and funding for people with disabilities in Australia.

One of the key components of the NDIS is the Specialist Disability Accommodation (SDA) program, which seeks to provide more housing options for people with high-level disability needs.

 

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Why NDIS SDA?

Increasing Demand for SDA Properties

The demand for SDA properties is on the rise due to the increasing number of people with disabilities in Australia. According to the Australian Bureau of Statistics, over 4.4 million people in Australia have a disability, and this number is expected to increase in the coming years. As a result, the demand for SDA properties is expected to grow significantly, making it a valuable investment opportunity for property investors.

Long-Term Lease Agreements

One of the significant advantages of investing in NDIS SDA properties is the long-term lease agreements. The NDIS provides funding for eligible participants to access SDA properties, and these participants sign lease agreements for a minimum of five years. This ensures that property investors have a reliable and consistent income stream for an extended period, making it a secure investment opportunity.

High Rental Yields

Investing in NDIS SDA properties can provide high rental yields. The rental income for SDA properties is generally higher than traditional rental properties due to the specific design requirements and the need to meet the high level of disability support needed. According to the NDIS, the maximum rent for a one-bedroom SDA property is $28,595 per annum, while a four-bedroom SDA property can fetch up to $92,655 per annum. This high rental yield makes NDIS SDA properties an attractive investment opportunity for investors.

Government Support

The Australian government provides significant support for people with disabilities through the NDIS program. This support includes funding for SDA properties, making it an attractive investment opportunity for property investors. The government provides funding for the construction and modification of SDA properties, ensuring that they meet the specific needs of people with high-level disability needs. This support makes it easier for property investors to invest in NDIS SDA properties without incurring significant expenses.

Low Vacancy Rates

Investing in NDIS SDA properties can provide low vacancy rates. Due to the high demand for SDA properties, it is rare for an SDA property to remain vacant for long periods. The long-term lease agreements and government support ensure that property investors have stable and reliable tenants, reducing the risk of vacancies and maximizing rental income.

NDIA SDA and SDA Categories

While the NDIS SDA can be a strong investment option, it’s important to conduct thorough research, seek professional advice, and consider the unique factors of each property and location before making any investment decision.

Total projected requirements of SDAs in Australia: According to the National Disability Insurance Agency (NDIA), it is estimated that approximately 35,000 specialist disability accommodation places will be required across Australia by 2023. This projection takes into account the expected growth in demand for housing options that cater to individuals with high support needs.

Average return per participant in an NDIS SDA (2022-2023): The average return on investment per participant in an NDIS SDA can vary depending on factors such as location, property type, and support level required. While specific figures for the year 2022 to 2023 are not readily available, it is important to note that SDA properties generally command higher rental returns compared to traditional residential properties.

The rental returns for SDA properties are determined by the NDIA through a pricing framework. The framework categorizes SDA properties into different levels (Improved Livability, Fully Accessible, Robust, and High Physical Support) based on the level of support and accommodation features provided. The rental prices for each category are set accordingly.

The average return per participant in an NDIS SDA can range from approximately $18,000 to $60,000 per year, depending on the category and location of the property. It’s crucial to conduct thorough market research and seek advice from experts to determine the specific rental returns for the SDA properties in your desired location.

It’s worth noting that these figures are subject to change as the demand for SDA properties evolves and the NDIA adjusts its pricing framework upwards. It is advisable to stay updated with the latest information and consult with professionals specializing in disability accommodation investments for accurate and current projections.

Conclusion

There is no one-size-fits-all when it comes to property investing. This is something every investor is wary of – not all property types work for certain property investors’ portfolios. This is entirely up to what an investor wants to achieve and prioritise. We always advise our property investors to consider their short and long-term plans and goals before even looking at a property stocklist. It’s not always about diversifying, this is about coping with the market and how one can handle the challenges the market will present in the future. The market though should not stop you from growing – it should be able to give you an opportunity.

NDIS SDA properties are a strong and reliable investment opportunity in Australia. The increasing demand for SDA properties, long-term lease agreements, high rental yields, government support, and low vacancy rates make it an attractive investment option for property investors. Investing in NDIS SDA properties can provide a reliable and consistent income stream for an extended period, making it a secure investment opportunity. As demand for SDA properties continues to grow, investing in NDIS SDA properties will become an even more valuable investment opportunity for property investors.

Book a call to discuss your options and what we can do to help you grow your property portfolio today.

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