INVESTMENT & CONSTRUCTION
NATIONAL DISABILITY SCHEME PROPERTY FINANCE
Specialist Disability Accommodation (SDA) is the housing for people who require specialist housing solutions, which assists and supports them for their functional impairment or high support needs. Creating new SDA properties requires large amounts of finance. More than $5 billion in capital is needed over the next five years alone to create new housing stock in SDA. In total, SDA housing stock is expected to be worth $10–12 billion
Funding is provided to a proportion of NDIS participants and there is a shortage of these specialist types of housing.
There are risks and benefits involved with any type of investment, and NDIS housing is no different. Some main benefits are:
- Tenants rents are paid by Government
- Steady income stream when occupied
- Average returns can be as high as 12-15% annual returns
Lending in this space is limited to a few key players, however the Simplicity group is well versed in the investment and also construction of these assets. Typical loans are up to 65-70% but typically have stronger appetite from lenders when there is an alternate use.
The greater risk is for developers to misunderstand the market and not build what people want. The concept of ‘ordinary life’ as part of the NDIS, that people with disability should have the same opportunities to meet the life milestones the general Australian public expect, means that people with disability will demand housing that reflects Australian society