Investors now have the opportunity to gain reasonable returns while helping those in need, according to a national property strategist.
The National Disability Insurance Scheme (NDIS) is a program that aims to rehouse people with disabilities in privately established and high-quality specialist accommodation. NDIS will cover the cost of accommodation and ongoing care for participants to enter specialised housing.
According to Michael Knights, managing director of Horizon Property Alliance, private investors may come into play by coordinating with an accredited care provider who can assist them in establishing specialist housing for those with severe disabilities that need 24-hour care.
“We are aware of a variety of models available to investors who want to be part of the scheme, but all revolve around establishing a bespoke home for three to five participants,” he said. “The investor-owner then grants the care provider permission to operate in the home for a predetermined rental amount and, in many cases, a share of the care business’s profits.”
Knights added that apart from being able to reach out to those in need, private investors are incentivised through “excellent returns.”
The program is doing well, with the NDIS reporting that around 460,000 Australians under the age of 65 with a permanent and significant disability will access its services.
On top of this, the government-funded payments would give investors security of income.
“That said, there are always risks when investing. In this instance, you need to ensure you’re aligned with a high-quality care provider,” Knights said. “Also, while vacancies are a normal risk for property investors, the government will provide a three-month rental guarantee when rooms become vacant. Given the waiting list that currently exists, however, we don’t envisage vacancies being a major downside. The only other risk seems to be future changes in government policy, but we believe the program’s success will become apparent in the short term.”
The program was launched in 2017, but it was not until recently that required checks and balances were put into place. Based on a 2017 Productivity Commission report, the NDIS is anticipated to support about 475,000 people at a cost of $22 billion in its first year.
Top Suburbs :
Get help with your investment property
Do you need help finding the right loan for your investment?
When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.
Just fill in a few details below and we'll then arrange for a local mortgage broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus an appointment is free.
We value your privacy and treat all your information seriously - you can check out