Too good to be true?

Hi all, I am new to this forum and would like some feedback. My dad used to tell me if it's too good to be true it often is. I have just made an offer on two over 55's units (freehold) that are one bedroom, and are renting out for a combined incomme of $430 a week. With a purchase price of $145,000 including costs giving a gross return of 16% and a nett return of 9.6%. Now they are in Slacks Creek in Brisbane, don't flood, property is really well kept and has over a 95% tennancy rate.

I realise that capital growth will not be good (I am purely looking for a strong long term return for my SMSF). What am I missing? Is there a fault in my cunning and devious plan? Thanks in advance.

 

Difficulty in getting finance and difficulty in selling.

 

Your father was a wise man, and he'd be proud of your caution. Check the paperwork - it may be there are substantial ongoing costs for various expenses and management fees, or it may be such fees are very low and reasonable but subject to arbitrary changes and you're strapped in for the ride. There'll be traps and catches. Just keep looking until you find them. They'll either be in exceptionally small print, or exceptionally large print.