NRAS – are you kidding?

NRAS - are you kidding?I did say in my first email out to everybody that some of my stories would be controversial, well this post WILL be very controversial to some, I may even lose a few Facebook followers over this one, but ah well…

I am often asked if I would buy an NRAS property?

I can honestly say, I would rather stick a fork in my eye rather than buy an NRAS property.

As a professional investor I would never consider a property simply because you receive some extra tax benefits.

For those of you saying “ What is an NRAS property?” Let me quickly explain… National Rental Affordability Scheme. If the name alone doesn’t make you run, then the word “Scheme” surely should.


Let me go into “ the scheme” a little further…

You, the investor, buy a House and Land package that has been NRAS approved.

Mistake number 1, you have possibly just been ripped off on price by your “adviser” as the developer pays kick backs to advisers, mortgage brokers, accountants and property companies for selling these types of houses. They can be as big as $50,000 per house.This kick back falsely increases the median house price of the area as well.

Did you notice there is no negotiation on price??? Hmm some deal you got???

Mistake number 2, the property is let out to people who cannot afford market rent. Essentially you have people on pensions, welfare and/or very low-income earners living in your brand new property. We have tens of thousands of people with good paying jobs, wanting to get ahead in life that cannot afford to buy a new home to live in,  yet these properties are let to people who cannot afford the basics in life. I am sure there are some genuinely nice people who need to be supported by our government & I do not have a problem with this, but why are they rewarded with a new house or unit???

Why wouldn’t the government make it more attractive for home-buyers and investors to buy new properties, leaving the more established properties for those needing the assistance???

I am 38 years old and my home was originally built in the 50’s with the extension built in 1982.

So to make this “scheme” attractive, the government allows you claim more deductions on the property than you could normally. Approximately $10,000 per annum.

The break up is made up of the following:

  • $7486 Tax offset per annum – after spending countless hours on the phone to the ATO it is now unclear whether this is a gross or a net number, either way, it doesn’t change my mind on NRAS
  • $2495 cash rebate per annum

The property must be approved to be an NRAS property and let out to a government-approved tenant for a 10yr period. The rent charged is calculated at 20% below market rent and adjusted with CPI.

Some thoughts come flying into my mind straight away:

  • Rents in Australia have generally increased a lot faster than CPI of 3%, the rents on my own properties are currently increasing between 6%-12% per annum.
  • What happens if they don’t pay the rent? How do you get them out? Tenancy Laws are tough enough to get bad tenants out let alone government backed tenants. I’m sure the tenancy tribunal would favor the landlord here over making a low-income earner homeless, NOT!
  • What are the capital gains prospects of an area drowned in NRAS properties? Potential buyers would run for the hills rather than live in this area. Have you heard of ANYONE EVER selling an NRAS property for a profit? I’m in the game and I haven’t…
  • If you decide to sell before the 10 years is up, then you are limited to selling to investors only, limiting your potential buyers to about 30% of the market.
  • Of all the NRAS advisers I have spoken to, the majority of them own 1 NRAS property. If they are such a good investment, then why don’t they own 10 plus each?

Now if that doesn’t make you change your mind, how about this good news story…

In a medium density development in Sydney where almost 60% (around 40 units) of the development was sold to owner occupiers and investors for a pretty penny, the developer then became cash strapped and had to sell fast so a property company came in and struck a deal with the developer. The remainder of the units were approved for NRAS and sold 20% cheaper than the earlier sales and investors snapped them up with NRAS approved tenants moving in.

As a consequence, the sales price of those units are now down another 25% in value… great deal I think not. Nice to know the so called “property company” who recommended these units as an investment were looking after their clients best interests.

Now before you jump down my throat, I have also heard of the programs that allow Police Officers and other government workers to live in their properties but honestly, what Police Officer would want to live in these neighborhoods?

Now don’t let me deter you from exploring this as an option, I just like to make sure that as investors and readers of my blog, you have my honest opinion.

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  • Jack June 9, 2019, 6:46 am

    Hi, I’m looking to purchase an owner occupied townhouse in pennant hills, Sydney. There are 8 townhouses in the complex, and 4 of them are in the NRAS scheme. Is it a good idea to buy in this complex? Would this townhouse be expected to experience the same growth rate as other similar properties in the area? My intention is to live in this property.

  • Jake February 24, 2019, 7:21 pm

    Your attitude towards property investment is refreshing. The idea of not investing for tax purposes is contrary to so many property investor attitudes, with negative gearing and the taxable income reduction being practically the sole reason for many property investors who have a portfolio built on tax reduction. Obviously these people have capital gains in mind too, if you felt that the capital gains of an NRA had enough upside would that change your mind at all? I’m not 100% sure how they work so maybe this question is dumb.

  • Jennifer January 10, 2019, 3:55 am

    Hi Neil,

    I also have not received 15-16 federal incentives, 16-17 state incentives and 16-17 federal incentives. Can you please contact me in relation to join the class action against Ethan? My email address is


  • Hannah September 7, 2018, 9:43 pm

    Thanks for creating this blog, just saved me from taking a risk that I felt was too good to be true.

    Thank you everyone for sharing your stories!

    • Todd September 11, 2018, 10:09 pm

      Glad I could help…

      • Jodie Rothwell February 1, 2019, 1:12 pm

        Hello Todd, I find your paragraph about low income earners completely offensive!! My husband and I have paid taxes all our lives and my husband quit a high paying job for our family to serve as volunteers on the African continent with an NGO, for almost eight years. We returned to Australia towards the end of 2018 and my husband had had difficulty finding employment as he has not had recent Australian experience in his specialist field. How dare you openly state that we are not deserving of the accommodation that this scheme affords! Now dare you imply that we are lesser citizens who would probably trash a new property! How dare you suggest that because we find ourselves unemployed right now that somehow we don’t want to get ahead in life! We have owned three properties and we plan to own our own home again in the near future. Your attitude is disgusting, biased and completely stereotypical! I just hope that one day you do not have the misfortune to be unemployed and facing the likes of ignorant people such as yourself!

        • Todd September 26, 2019, 4:03 am

          Hi Jodie

          Thanks for your comments. You’ll notice this is MY blog, which means MY opinion. And, if you read the thread, there are many good tenants, but also many trouble tenants that have caused problems for investors. This isn’t a blog directed at you personally, as I don’t know you, but, again, its my opinion. I won’t comment on your personal circumstances, as that is not the idea of this post.

          Good luck in your future property plans.



    • Diana November 21, 2018, 8:31 am

      I’m one of those horrible people you don’t think deserves a nice home. I’ve worked hard my whole life and unfortunately have never been in a position to buy.
      At 52 I developed Fibromyyalgia a chronic pain disorder due to PTSD from events in my life I did not cause such as a home invasion by 4 men with guns when I was a child.
      Ive done 8yrs voluntary service with NSW Police and was due to start my career when I had a sezuire and was diagnosed with epilepsy. I’ve rented privately my whole life and paid 400 pr wk alone and never missed a single week. So I am one the people you don’t think deserves a nice home.

      • Todd November 22, 2018, 6:20 am

        Hi Diana,

        Everybody deserves a home – doesn’t necessarily mean that you need to own that home. Millions of tenants call their property home and rightly so. Unfortunately, under this plan, tens of thousands of investment properties that you call home, won’t be around. They will be sold to owner occupied buyers and the rental property pool is going to reduce dramatically – which will only force rents up.


    • Ian Hazzard September 24, 2019, 11:39 pm

      I own 2 NRAS properties on the Sunshine Coast. Bought them around 6 or 7 years ago. Since then I have been reducing my tax by around 20K per year from the NRAS. The rent just about covers my expenses and mortgage. They have been the best investment I have made (Apart from a rental in Weipa).
      This story is old but totally unfounded. Our tenants have always been good, they can earn up to around $120,000 PA for a couple and the house in immaculate condition. Unfortunately our tenants have changed a couple of times as their circumstances change. Meaning they no longer qualify for NRAS. I would highly recommend these as an investment.

      • Ian Hazzard September 24, 2019, 11:43 pm

        I am trying to reply to comment above, not this comment.

      • Todd September 26, 2019, 3:57 am

        Hi Ian,

        I’m stoked you have had an awesome experience. Thanks for sharing your experience. This post is many years old, with various stories told throughout the years. Its important as investors we have the opportunity to hear how others have done well, or what other investors have learned along the way.



  • Ken Smith September 5, 2018, 8:51 am

    This NRAS scheme i thought was to help those for low income to rent a property. My wife and I are both on Disability Pensions and applied for NRAS to rent a property in Kendall NSW. We were knocked back. We have been renting for last 8 yrs in same place kept it just as if we owned it ourselves. Never ever late with rent & great references..and yet we didn’t qualify to rent a property. So much for helping low income people.

  • Marcus L August 9, 2018, 3:10 pm

    Hi all.

    I’ve been watching this site’s comments for years and read it before investing in NRAS. It’s a great perspective. I now have eight properties about half way through their 10 year terms. Each property makes about $10k in positive cash flow per year after tax at 32.5%. On average an 11% retuen on my initial investment after tax. I’ve had almost no vacancies in my NRAS properties. I always get my payments. No significant issues with tenants (touch wood). Capital gains haven’t been huge though but the cycle will get to them in the 10 year period. It’s great for the risk profile that I’m comfortable with.

    I think it’s a great scheme for the government, tenant and investor. Win, win, win. No wonder they stopped it!

    Anyway, I hope that’s a different perspective. For those that have issues getting payments then that’s a problem with your manager, consortium or your understanding of how to claim in your tax return. It’s a problem not with the scheme but the agent/consortium you use (no different from a bad real estate agent). Best of luck to those people.

    I hope that gives another view and some experience. Unfortunately I would argue with the terms left on most NRAS peoperties now (not more than 6 years in most cases) many of the benefits are already gone and it’s not that good to invest in a mid-term NRAS property.

    • Todd September 4, 2018, 1:12 am

      Hi Marcus,

      Sounds like you are one of the lucky ones… Congrats

      Cheers Todd

    • JDub January 7, 2019, 12:00 am

      Hi Marcus,
      I’m in the same boat as you. I purchase my first NRAS in 2016 and have had nothing but great tenants. No issues to date with the building, which BTW – came with air con, dishwasher and a lot more percs than other House & Land packages we purchased for more $$$.
      I bought in the low $300k and although the property isn’t’ in a flash neighborhood, I could resell with nearly $40k increase from my initial purchase 2.5 years ago, regardless of how bad the market has been.

      I understand that there is definite concerns regarding bad tenancy, but having a good property manager goes a long way. With the NRAS incentive and including tax depreciation, we made a $16k profit on that property in the 2017/18 financial year. None of our other properties, even the flash ones come close to that cash flow.

      Here’s hoping it stays positive, but I would love to have a few more under our belt like that.
      Our financial adviser has 7, maybe 8 now, and he’s loving the yearly returns.

      Not all bad – just another view 🙂

    • Steven Ng February 9, 2019, 6:40 am

      Hi Marcus,

      Can you let us know which NRAS agents/consortium you are with. I’m thinking of changing from my Ethan/Quantum/Questus, I suspect they are part of the same mob which consistently have a lot of issues/excuses with getting our NRAS rebates back from government/ATO.

      Steven Ng

    • Ari June 8, 2019, 12:12 pm

      With the initial income limit per person being $51,398 and the existing income limit per person being $64,248 I doubt these people cant afford basics. This is the general income of most young Australians who are simple workers and dont have a career yet. $1000 a week is more than enough to afford a normal 1 bedroom apartment little alone an NRAS approved one.

    • Andrew July 4, 2019, 6:36 am

      like Marcas I have been investing in NRAS for a long time. It was my first property investment in fact, and a good decision as at the time I didn’t have enough income to cover cash flow negative properties.

      The scare mongering about this being community housing and therefore getting poor tenants on mass in a neighbourhood is completely false. Whilst these are often clumped, they are always mixed with normal properties, so no one actually even knows what is part of the scheme or not.

      My first NRAS has just finished and during the time I only ever had GREAT tenants. My existing tenants decided to stay despite the rent going up 20%. I have since purchased two duel NRAS – duel key houses (ie 2 tenants in each house), and again I have not had any issue with tenants (except for one lady breaking lease).

      For the most part, almost every tenant we have is a single mother, and my longest running tenant was a couple with a disability. They have never been vacant. The most important thing here is that you get to chose the tenant.

      The great thing about the double NRAS is I get $20K tax free each year on a nearly cash flow neutral property. They should be more than half paid off by the time it ends. The capital grains are pretty crappy yes, but that is not because its NRAS but because they were build in new development areas. With so much stock coming on, any house will be stagnant in these areas. In fact, with the economy where it is at the moment, NRAS is almost the best position to be in because your profit is guaranteed and there will be plenty of people who cant afford market rent.

      Having said that, anything for sale now, with only 6 or 7 years left, you would really need to crunch the numbers a bit harder / ask for a discount / think about the area its in.

  • Dave July 23, 2018, 8:31 am

    Hello, very interesting that others are experiencing similar issues with State payments for NRAS properties as us. Very interested in joining a class action. Sad that State and Federal Governments are not standing up to these so called contractors of a Government scheme.

    • Kaylie Bidois August 2, 2018, 2:16 pm

      Oh no! So disheartening to see comments as recent as July this year. We own an NRAS property in WA, quantum (Ethan/Tebter) are who we deal with too!. They are shady AF!. Quantum told us our property manager didn’t meet the NRAS requirements any longer and gave us a list of new property managers we could change to without any fees etc. The list of names/companies all related back to Ethan/Tebter/Quantum. As we have such a good relationship with our current property manager we asked him about it and we have been fighting with Quantum ever since. They emailed threatening that we were in breach and would not receive our incentive about 6 times but we stood our ground. We have only received one email so far this year saying we should get confirmation of our incentive in August some
      Time but if we were non compliant for a period that we won’t get any for that time. (I’m assuming that we won’t be compliant for the whole time we refused to change property managers) so probably wont get an incentive this year. Not sure if we are already a part of this class action as my partner had been dealing with it. But please email me

      • Todd August 6, 2018, 1:08 am

        Hey Kaylie,

        I’m so sorry to hear of your situation, that is super shady indeed.
        Best person to contact is Neil Hutchison;
        You can see Neil’s comment further below.

        Cheers, Todd

  • Neil May 9, 2018, 3:14 am

    I have read the comments and support a lot of what has been said.

    I am a property manager in Darwin and now have the issue whereby my clients and Investors have not been paid their incentives owing to them by an Approved Participant of the Scheme.

    We have begun a class action and it would be pertinent of people who have also not received their incentives to make contact with me so that I can assist them on how they can get what is owed to them



    • Mick May 17, 2018, 2:22 pm

      Hi Neil
      I would be interested in the proposed class action as I’ve experienced non payment of incentives.

      • Todd May 23, 2018, 2:20 am

        Hi Mick,

        I wasn’t aware of a class action, but wouldn’t be surprised if there is one.

        Cheers Todd

      • daniel bialy June 30, 2018, 3:51 am

        I have the same problem with my NRAS property in Melbourne. Haven’t been paid my incentive for the last 2 years. Please contact me to discuss and help organise some response to this rip-off. Thanks.

        • Andrew July 4, 2019, 6:38 am

          How about you talk to your applicant. Who is your applicant anyway? There were issues early on in the scheme, but this was the governments fault. Its been sorted for a while now.

      • daniel bialy June 30, 2018, 3:52 am

        I have the same problem with my NRAS property in Melbourne. Haven’t been paid my incentive for the last 2 years. Please contact me to discuss and help organise some response to this rip-off. Thanks.

    • Angela Hoskins May 29, 2018, 3:43 am

      Hi Neil,
      Regrettably, I bought an NRAS property from Ethan Housing back in 2013. I am waiting on the 2016-17 subsidy to be paid, I’ll participate in a class action. I don’t know how to start one but will gladly put in energy to assisting to get it off the ground.

      • daniel bialy June 30, 2018, 3:56 am

        Hi Angela,
        I have the same problem with Ethan and my NRAS property in Melbourne. Haven’t been paid due incentive for the last 2 years. Please contact me to discuss options and response to this rip-off. Thanks.

    • Elaine Gover May 31, 2018, 7:56 am

      Hello Neil, we live in Melbourne own an NRAS property but have not received our last two years incentives owing to use from Ethan . Can you contact us in regards to the class action.

      • daniel bialy June 30, 2018, 3:58 am

        Hi Elaine
        I have the same problem with my NRAS property in Melbourne. Haven’t been paid incentive for the last 2 years. Please contact me to discuss it. Thanks.

    • Rob Cochrane July 11, 2018, 6:35 am

      Hello Neil.
      I’m a NRAS investor in Melbourne. I have not been paid my previous 3 financial years investor insentive by Ethan or Quantum.
      I’m interested in finding out more about your proposed class action.

    • Neil hutchison July 18, 2018, 5:10 am

      I have not had rent paid from TEBTER for 12 weeks now . I meed help . My property is in Geraldton are there others here that made the mistake of dealing with Tebter

      • Julie Lovell October 15, 2018, 9:13 am

        Yes we are in the same boat..we have not been paid from Tebter/ Ethan since May..
        We have just reported bthem to ASIC… Waiting on there response.
        I just can’t see how they can get away with this.
        I believe there is many more investors in the same boat

    • Margaret & Jason King` July 23, 2018, 2:33 am

      Hi, we are having very similar experiences with our property in Melbourne in relation to Ethan/Quantum not passing on government incentives, and would be interested to find out what is involved in joining your class action.
      Jason & Margaret King

    • Dave July 23, 2018, 9:15 am

      We would be interested in a class action. Very interesting that others are experiencing similar issues with State payments being distributed by Ethan. Such a shame that Federal and State Governments are not more able to influence the organisations it has issued contracts to.

    • Jim wilson August 8, 2018, 12:17 pm

      What do u know about tebter real estate in Darwin my number is 0405807582 I’m a unhappy customer

    • Alvin Lee August 26, 2018, 1:04 am

      Morning Neil, I am facing the same problem in Melbourne. No rental payment from Tebter for the last three months. What government incentive are you guys talking about? I am totally blank about this NRAS thing. Please help. I am just a normal senior citizen trying to plan for my retirement. Looks like my retirement is on a see-saw now.

    • Steven Ng February 9, 2019, 1:11 am

      Hi Neil,

      Just found this website after google search for NRAS complaint.

      I’m in the same boat with other investors who have not received NRAS rebates for the last two years. I’ll be interested to join the class action if it’s not too late.

      Steven Ng

  • j v February 17, 2018, 7:01 am

    Thanks, I’m 57, can’t find employment after I pay my private rent I have $145 a week to live on for everything, my property is maintained to the highest level and I have never been late on one rental payment EVER, for financial reasons I would love a nras property but have had no luck getting one. I don’t know whats worse a fork in the eye or long term poverty in silence …..I;ll take the fork in the eye at least it would be quick and over not like the suffering I endure day after day for years, regards from the best tenant in the world.

    • Todd March 27, 2018, 12:02 am

      Thanks for commenting. I am not sure what it takes to get into an NRAS property. Sorry, I would like to help but it’s not my specialty

      Cheers Todd

  • mark January 10, 2018, 7:58 am

    Hi looking at buying a nras property, that is a resale it is 4 years old it has had the same tenant since built property is in excellent condition it appears to be a good deal the rent is $280 p/w on a $270000 property and with the gov incentives seems a good buy, just not sure on the $7500 from federal gov is this just a tax right off, as i am buying in my super fund not sure i will get the full benefit

    • Todd March 27, 2018, 12:01 am

      Hi Mark,

      Good luck in getting your benefits each year. Feel free to scroll through comments as many investors didn’t receive their tax benefits for 2 years. And I am sure you could buy a house anywhere with those returns.

      Cheers Todd

  • David May 31, 2017, 11:32 am

    Jumping in a bit late here, but although I saw this article a few months ago, it was just emailed to me by a colleague. After seeing a tv ad for NRAS properties, I jumped online out of curiosity. A quick calculation on the (very poor) returns and a google search on locations, with comparable sales in nearby areas and potential capital growth (practically nil) was enough for me to drop the research and forget they existed… As a real estate agent with 22 years experience, I’m with you Todd. I’d rather stick a fork in my eye…

    • Todd August 8, 2017, 3:34 am

      Wow David,

      Yes you are late to jump in Lol… Im amazed you even gave it the time of day… Stick with me on the US stuff…

      Cheers Todd

  • Todd May 20, 2017, 1:14 am

    Interesting develop in the world of NRAS providers.

    Appears Ethan Property are telling their clients they are sending the compliance management to Quantum Housing in Western Australia and that the client will have flexibility to choose a property manager of their choice.

    From investigations it appears Quantum will be Ethan property but under another name but still run by the same people and the clients have no choice but to stay with the incompetent property management of Ethan Property and incentives will continue to lag well behind the yearly distributions

    Ethan property have engaged in clear ‘third line forcing’ to the disadvantage of the NRAS investors and tenants.

    The investors are losing out on the incentives, their properties are being mismanaged thus losing rent and the property condition is in decline all because Ethan property want to protect the money grab that is dealt out by the government who refuse to give flexibility to those who supported the scheme by becoming investors.

    Ethan Property and its directors need to be exposed.

    • Todd May 31, 2017, 12:09 am

      Hi Todd,

      This is the first I have heard about this… not good if its true.

      Cheers Todd

      • Todd June 7, 2017, 6:27 am

        Ethan now merged into Tebter Property, trying to outrun the stick of incompetence.

        • Todd August 8, 2017, 3:31 am

          Yes Ive just read…

      • Todd August 8, 2017, 3:36 am

        Read the new comments – theres more tragedy about to happen

    • Jacinta June 26, 2017, 12:08 am

      Hi Todd,
      Reading your stories about NRAS.
      We regret buying ours.
      Are there lots of stories coming in? Like investors not receiving rent and properties not being cared for?
      Does anyone know if you can sell the properties to homeowners?

      • Todd August 8, 2017, 3:29 am

        Hi Jacinta,

        I believe you can but you’d need to check your contract thoroughly.

        Cheers Todd

      • Esmerelda September 23, 2017, 10:27 am

        We are investors in storey creek estate. We are receiving no rent & no qld subsidy and our houses are falling into disrepair & neglect on top of wilful damage. We have not had one entry or exit report in 8 years and he will not give us our house back. We still have another 18 months and 2 years respectively before the 10 years r up. We’re being scammed and if we try and talk to him he just becomes abusive and says he’ll sue us.

        • Todd October 16, 2017, 5:44 am

          Oh my Jacinta that doesnt sound like a good experience at all.
          Certainly the first point of contact I would suggest is Department of Fair trading in the hope they can assist you here, I’m so sorry to hear this.


      • Impeccable March 26, 2018, 1:46 am

        Hi, Jacinta. Sorry you have had a nefarious expirience with your investment property. Would you like to rent your property (if its in Perth) to somebody with an impeccable rental record,perfect credit report,federal police clearance. Work references,BUT happens to be on a pension?

      • Jacinta June 25, 2018, 5:56 am

        Hi, Todd

        One year on: To anyone thinking of buying NRAS just invest in a racehorse. Hurts less than a fork.
        We had two NRAS houses. No rent received for 7 months on one and 11 months for the other.
        Over $20,000 repairs and maintenance to get them in saleable condition.
        One sold for under cost the other other is still out there.
        We have not received the Incentives or Offsets for two years .
        I’ve emailed to anyone I can but they don’t take responsibility.
        Now, to read the Form Guide.
        Good luck to you all


        • Todd June 25, 2018, 7:01 am

          Hi Jacinta,

          I’m so sorry you have endured this, by the looks of the comments, you are not alone.
          Check out the comments above from Neil re the class action he is putting together, hopefully through a joint effort of owners, everyone may get a positive result.
          Thanks also for your comment, its through knowledge that investors can make an informed decision now and in the future!


    • Charlie Chai July 5, 2017, 3:20 am

      I don’t know Ethan Property but I have been dealling with two property management agents in NSW. We have 27 affordable housing dwellings in Sydney. 16 of those 27 have been in the scheme from 2009-10 NRAS year. Another 8 of them came in later in 2011-12 and the last 3 of those 27 came in 2016-17 which are no longer with any incentive at all. In the past 6 years, I realised all issues are very compilated. The two main issues are caused by the misunderstood of the Policy by the property manager and the system defects of DSS portal.

      Here are some key points I found everyone should be aware:

      Rule No.1
      The only difference between Affordable Housing Dwelling and Normal Residential Dwelling is Affordable Housing Dwellings are with an additional condition for NRAS policy unless any discrepancy between any clause of NRAS policy and all other common statutory legislation such as Tenancy laws. Any issue of rent loss or delay, property damage etc. should not a matter with NRAS at all.

      Rule No.2
      NRAS homes are not social housing—they are affordable private rental homes. NRAS issues financial incentives to organisations that provide people on low to moderate incomes with an opportunity to rent homes at a rate that is at least 20 percent below market value rent. NSW Affordable Housing Policy is at least 25% below market value rent if owner wants to have both Commonwealth and NSW State Incentives.

      Affordable Housing is different with Social Housing. Pensioner status is not the key to let anyone live in an NRAS dwelling. Lots of people misunderstood this and it is very hard to draw an line to manage the interests between Tenants’ and Landlord’s. Tenants have to meet the NRAS Eligibility Criteria if the landlord don’t want to loose any NRAS incentive. Landlord should have the right to choose the tenants which recommended by the property manager. We used to have an issue of the rent review. We misunderstood the policy and the Tenancy Lease did say how much the rent payable and how much the market rent. However, the misunderstood of the rent payable set up was less than 30% of household income or less than 75% of market rent. This caused an issue more rent reviews requested by the tenants rather than the rent reviews requested by the property managers. Tenants didn’t disclose any income increase but they notify property manager immediately for any two weeks if their payslips shows an decrease of income. The consequence is the actual rent payable within 12 months will have to be changed more than once and the current rent payable may be increased more than CPI index but still far less than 50% of market rent. The landlord couldn’t get full incentive because of the rent was increased more than once and rent amount increased was more than CPI indexed. This is an system defects which I believe it has been fixed, otherwise DSS Compliance Team will have to manually review the claim. Even with less than 50% of market rent, it remains for few years until the Tenancy Agreement terminated. Lucky I am not the owner of those dwellings. They belong to Local Councils which I worked with. Council’s own policy requries property manager to select specific group of people to live in those Council owned NRAS properties, such as Child Care, Hospital employees and police, firefighters (income limit still applied).

      Rule No.3
      Always follow with the NRAS guidance or Fact Sheet and appoint someone fully understand those guidance and fact sheets to be your property manager. DO NOT assume those suggested property managers from DSS are experienced and you will be shocked when you dig up any reason you can’t have your incentive claimed on time. A serious misunderstood I found with our current property manager is that they tried to use the current household income to be compliance with the “Initial Income Limits” of 5 years ago when the tenants moved in the dwelling. They don’t have any idea what they should do and how to keep all NRAS dwellings compliance with NRAS criteria.

      The key events should have always to be in place for all affordable housing dwellings are (property manager should be aware with):
      1. Income Review twice every year by using “two continued recent pay slips” and “Group Certificate and Centrelink Statement in July every year”.
      2. Rent view is better on the anniversary date of the Tenancy Agreement whether rent increased by CPI or Individual Market Rent Revaluation. Any rent movement shall have a new lease signed if a new lease with the same tenants, this is to ensure both tenants and landlord are covered with the latest agreement under tenancy law. If any future issue caused by NRAS policy because of the discrepancy, then you are protected by tenancy law.
      3. To submit TDA and Claim in DSS portal, always start a new TDA when you have a new lease signed no matter for the new lease with new tenants or new lease with same tenants. For the same lease with same tenants with no rent changes at all from 01/05/20** to 30/04/20** NRAS year, property managers should be questioned why no CPI increase in place.

      Rule No.4
      Always buy insurance for your property which also includes “Rental Loss”. Any damage will be covered by insurance.

      Rule No.5
      Never sign in with any property manager for long term contracts. Contract can be renewed every year or two years. Property managers may be over favour with tenants when they are showing there kindness to tenants, permission from landlord should be granted before that. If the landlord are not been given reasonable suggestions for potential tenants list, landlord may appoint another property manager when contract end. Remember, landlords always have the right to choose the tenants and it works in contrast.

      • Todd August 8, 2017, 3:28 am

        Hi Charlie,

        Stay away from anything that has the word “Scheme” associated with it!

        Cheers Todd

    • irene July 28, 2017, 2:08 am

      Hi Todd
      I am in Perth western Australia, recently we have been informed by Quantum housing to dismiss our current property management (Raine &Horne) and given a choice of 2 property management group in the name of Questus and Tebter. search on these 2 groups shows they are linked to Ethan property, we do not want to join any of them because of their fees, their history and I have not found good review about them. Quantum housing has threaten to remove our property from NRAS if you don’t do it. If the property is removed can we rent out at the normal market value, the property is in a complex of 17 townhouses. I agree Ethan property and their dealings need to be exposed, how can we do that.


      • Todd August 8, 2017, 3:26 am

        Hi Irene,

        Yes Ive just heard – theres another comment after yours that states the same. Id be contacting ACA or Today Tonight or 60 Minutes on that one as its extortion.

        Hope this helps…


        • Julie Lovell October 15, 2018, 9:21 am

          We have not been paid by Ethan for a property in Geraldton since May 2018.
          This group Tebter Ethan seem to be hiding between themselves.
          Waiting on response from ASIC.
          This should be reported to A Current Affair or similar and expose thus extortion.

  • Kristen April 11, 2017, 11:30 pm

    I don’t know about the investment side of the NRAS scheme however as for the quality of tenants, 3 of of my 4 neighbours are NRAS tenants and they are all quiet and look after their houses. I am not an NRAS tenant but I had once applied for one and they were strict on the rule about earning 3 times more the weekly rent rule which I didn’t however I can rent a more expensive normal house without earning 3 times the weekly rent, that’s probably why at my last house while the neighbours weren’t NRAS and they were mostly terrible.

    • Todd April 12, 2017, 3:41 am

      Hi Kristen,

      Thanks for your comment. Interesting to know they use the three times rule.

      Cheers Todd

  • Jim April 3, 2017, 5:22 am

    Spoke with a real estate agent on the weekend and she mentioned about this scheme. I had my reservations, and in speaking with a mate in Melbourne, he told me pretty much what your article highlights (Tenants/Commissions).

    Like anything, when seems too good to be true, its time to walk away and continue researching.

    • Todd April 6, 2017, 5:34 am

      Hi Jim,


      Cheers Todd

  • Stephen November 9, 2016, 3:22 am

    There are certainaly benefits for both renters and investors with NRAS, that is clear.

    I think that when you blanket say nras is a bad investment, you are as bad as marketers who blanket say they are a must have.

    There are some fantastic deals available with NRAS, and for strategies that require higher yielding investments they are perfect. Consider your point which states that they are ‘hard to sell’, well on the other side of the coin, for the buyers, that gives them fantastic opportunities for yield at $11,000 per year plus getting them at a great buy price also.

    If investors research their areas there are great deals to be had.

    • Todd November 21, 2016, 9:31 pm

      Hi Stephen,

      I am yet to see a fantastic re-sale of an NRAS property to date. I have seen run down bronx like neighbourhoods where the NRAS properties are all bundled together. And yes I can name them easily enough as I travel lots. I see property managers not want to touch them and who won’t take on the management of these properties. I see thousands of investors who have been ripped off by dodgy NRAS sellers who receive kickbacks as large as $60k per property. I have seen the government not pay the tax entitlements to owners who were promised these for over a year. We have seen the “Scheme” abolished – no words needed. I have seen NRAS houses trashed. And yes any investment property can be trashed but it would appear to be more common in these areas. I have seen rents that were suppose to go up, never go up!

      So Stephen, I am trying to see the good side to this… except for one thing. There are some good tenants who earn a lower income and it allows them to live in affordable housing – but this Blog was never about that!

      Cheers Todd

  • Elliot Miles September 26, 2016, 10:45 am

    It seems that we, and our numerous neighbours currently living in NRAS properties, may be the exceptions to the ‘rule’ seen here.

    I can’t and won’t attempt to comment on the effectiveness of NRAS tax incentives, though I can comment on the benefit of opening your property up to young professionals, students or single-parent families that the scheme targets, and the quality of some of the properties in the scheme.

    Both my partner and I are in our early thirties went back to University to slog out retraining while we benefited from affordable housing: I’m now a qualified Social Worker, my partner is a qualified Occupational Therapist. We’ve been happily living in our property for two and a half years, though will soon be rightfully moving on as we are now above the scheme’s income threshold.

    In our time in the property we’ve designed and built the now thriving garden from scratch, increasing the value of the property. We’ve without exception paid our rent early, and have alerted our agent to a few minor builder issues (poor gutter drainage which caused a leak in the garage). Other than these minor issues there has been no other problems with the property, and our landlord is thrilled with our investment around the place.

    Our NRAS neighbour in the left are a teacher and a trade apprentice, and on the right is a single mother working as a nurse. We all love a spot of gardening, and having seen both their homes and backyards know they have taken a similar high degree of care and appreciation for the opportunity to live in an affordable and new home.

    I see NRAS as a bit of a ‘what comes around goes around’ – in the sense that it provided us the support to gain the skills to then go out and provide wider services in the community. I really do hope that issues with tax mentioned here are resolved promptly, and the benefit works as it should.

    Thanks for your tax and property knowledge, though please keep in the mind the power you have to create or contribute to stereotypes about Australians, which may not always be fair to truthful.

    Kind regards

    • Todd October 6, 2016, 1:24 am

      Hi Elliott,

      Great to see that it has worked for you…

      Cheers Todd

      • Natasha February 26, 2017, 8:37 am

        To the Main Author of the post not this comment,

        Your post was great Elliot.

        This post is a terrible reflection on the NRAS and the people you have shamed as supposed undeserving of help, and demonised them in your post as people who will not pay rent and ruin your house is disgusting. These pensioners you are talking about cannot afford NRAS houses anyway. As above NRAS houses help people to get ahead, who do not earn over 99,000 or 124,000, and if the Disability Support Pension etcetra could cover this income then there would be no homeless people, single mums living in caravans or people in overcrowded housing. You need to take a look at the facts and I really hope your opinion on people on welfare has changed now, as they are all not deadbeats like you assume. Our government is actually breaching the Convention on the Rights of Persons with Disabilities contract it signed with the UN in 2006 in regards to housing. Research before you rant Sir!

        • Todd March 10, 2017, 1:42 am


          Have you visited these neighbourhoods around the nation? I am presuming not, you may been to one.

          So you mention pensioners, NRAS isn’t designed for pensioners, its designed for low income earners. For families who earn up to around $105k – now thats not really that low. Perhaps if you had seen more of these neighbourhoods and seen the damage to houses you may think differently. I am all for helping those who need help, but not if they destroy my property.

          The main part of the Blog (now written 5 years ago) was talking about the property summers ripping people off and now the government not paying the “guaranteed” tax breaks the were suppose to do. Add to this property damage and non payment of rent as well as investors being ripped off and this “Scheme” is now worth investing in.

          Surprising there is a new “Scheme” being launched again shortly. Won’t be any surprises what happens here!


  • Ray July 11, 2016, 12:59 pm

    Does anybody know the difference between NRAS properties and Affordable Housing Rental SEPP (AHRSEPP) properties? Thanks in advance.

    • Todd July 18, 2016, 6:48 am

      Hi Ray,

      I haven’t heard of the SEPP…

      I just had a read on it, I wouldn’t be looking at investing this way, looks similar to NRAS.

      Cheers Todd

    • Jennifer January 17, 2017, 4:12 am

      Hello Ray, from what I can find AHRSEPP is NSW only. Affordable rents.

  • Helena May 24, 2016, 10:29 am

    I purchased an Ethan property managed NRAS apartment in Melbourne back in April 2013. The apartment has given me nothing but hardship and distress. I had never experienced NRAS schemes until then and imagined it to be suitable since it was government supported and the added benefit of receiving $10,000 every year for cooperating in a government scheme. However, I did not receive any of these benefits.
    The unit is similar or even identical to the ones that surround it, yet my apartment occupancy is extremely low, with it being empty for over five months, while others are at least 80% filled. Since I live in Sydney, I have little to no control of managing the apartment and its occupancy as I wish. I have talked in detail to the building manager, to which his response was that I needed to speak to Ethan property. Then when I spoke to Ethan Property they were reluctant to locate the problem and continuously directed the problem to be with the whole area, season or the apartment itself. I feel they are taking advantage of the fact that I live so far away and can only rely on being notified of the apartment’s condition via them.
    I believe that Ethan Property is a major source of my problems but since it is the only NRAS provided management scheme I do not know what I should do. I don’t know if it is normal in Melbourne for apartment management but Ethan Property receives 11% of the profits whenever a tenant lives there, in Sydney, management usually receive 5% or less. I don’t understand how Ethan Property is not motivated to look for tenants with these conditions.
    Selling it now only aggravates me more as I have lost too much money and I feel I must make a final stance before I do come to any decision.
    What can I do to stop this lazy management?

    • Todd June 7, 2016, 4:19 am

      Hi Helena,

      Sorry to hear… maybe talk to Fair Trading?


    • Devon Christian September 22, 2016, 8:04 am

      Hi Helena,

      You can change the managing agent of your Nras property as long as the housing provider is aware. if you require any assistance please dont hesitate to send me an email:

    • Flo October 25, 2016, 6:19 am

      Sad to say that I am one of the tenant of a property managed by Ethan Property in Melbourne. I too experience similar, or worse, experience with them. I am about to apply for Tribunal and I feel for my landlord – as all these will not happen if the management at Ethan Property have handled and mitigate this issue competently.

      One of the things you can consider is to approach Consumer Affairs Victoria and file a complaint with them. This is what I intend to do as well. They are incompetent and irresponsible…. you are not alone!

      • Todd October 30, 2016, 11:16 pm

        Hi Flo,

        Sorry to hear it hasn’t gone well… hopefully the tribunal will sort it out for you

        Cheers Todd

  • Cherubim December 10, 2015, 5:16 pm

    Hi Todd,

    In the process of purchasing my first NRAS investment properties at Beckenham, WA. Walking distance to train station and shops. New property in unit complex, 2 bedroom 1bathroom 385K and rental value around 330 per week.
    I reckon the selling price is too high.
    What are your thoughts on this before I proceed.


    • Todd April 5, 2016, 5:57 am

      I think my Blog tells you my thoughts on NRAS clearly enough

    • K Wooller May 13, 2016, 3:18 pm

      Hi I was just reading about what you had to say about your number 2 remark, I had to laugh I have a large family whom all own investment properties and have partners, my partner has pass away, a young age I have work in medical profession for many years, full time and haven’t been fortunate to earn great deal of money to own my own home. but have always treated the rental place I have had with the up most respect. I would like to try nras, Sounds to me you are very narrow minded and are judgemental. So maybe one day you maybe in need, Hope you are not treated the way you have just come around in your e mail.

      • Todd May 19, 2016, 12:25 am

        Hi Kimmie,

        Unfortunately or maybe fortunately i have seen the ugly side to NRAS… now as the story says, its not all bad in the tenancy sense. Some tenants genuinely need this. The story is directed towards the property side and the sharks that ripped off thousands of investors in the process. It’s just not right.


        • Mayumi Nagarkar August 18, 2016, 2:45 am

          Hi Tod, pls let me know the NRAS ugly side. We are purchasing NRAS since 2011 and having 10 NRAS and buying another 2 properties. We could make over 140k cashflow per year and NRAS is the best scheme for us now to make positive cashflow. I know some of them are sold expensive, but invester will get validation from bank before purchasing the property. If the validation price is low, you just walk away the deal. Also you can negosiate the price.

          • Todd September 2, 2016, 4:56 am

            Hi Mayumi,

            I think the negative sides were clearly pointed out in the Blog. You must be one of the lucky ones who has been hassle free with your properties. many haven’t received they rebates cheques for over a year.

            Now the investor quite often won’t get validation from their bank. It depends on how the mortgage was written, along with the amount of sales previously gone through that were sold to investors through wrong mortgage structure. So that when the next investor is ripped off, the valuer has prevented proof of the rip off price and can justify their valuation at the high price.

            New houses, nah negotiation is rarely a done deal. These properties were sold through property companies who sell to their investors the line of huge government rebates. That way the investors don’t see the wool being pulled over their eyes.

            Cheers Todd

          • Yvette November 6, 2016, 9:53 am

            I am a NRAS tenant, but wish I had never been. I have become sick since living in this 4yr old home nor in Perth. This sickiness culminated recently with ‘confusion’, a fairly scary way to feel. My employer was very understanding. considering I work in childcare, I would have been forced to resign, had the confusion not slowly dissipated (over the course of 1-2weeks). Much research &many medical tests, later.. It seems the building has damp, whether from poorly built cornices and roofing that overlaps, or whether from cracks in mortar and brickwork, or whether, as seems to Also be the case, water rising or being trapped underneath the tiles. As I hastily search for alternative accomodation for myself and my son, I ponder what benefits, if any, this program has provided me, the tenant. I have paid $366 p/wk for two years, an amount that has been way above comparative rentals for at least the last year. CPI increases are built in to the contract, with no mention of rent decreases, as rental affordability improves with over-supply. Fortunately I am out of lease at the moment, making the move somewhat simpler. Meanwhile I have finally been offered the 20% below RRP that I was originally promised. My rent has now gone done to $284. But what price my health? &tgat of my son. Thanx but no thanx. I am also caused to ponder any possible benefit to the owner throughout. My rent Has been high. Apart from that though, the sceptic in me wonders if the owner will even be told of the damp and water problems that are the cause of my departure. My rental is one of eight, specifically built. How will that progress, I wonder. The damp is inbuilt. But eight properties and the repercussions for All may indeed prove too much liability, either for the property managers, or government building contractors, or the government themselves.
            So finances and economics seem to have found a way to affect the health and happiness of those of us less advantaged. (Including others who, like me, look after your children, but are not paid enough to afford private rentals, or indeed the luxury of living in peace. Perhaps that ought to be the questions we ask ourselves…

          • Todd November 21, 2016, 9:38 pm

            Hi Yvette,

            Yes its just another sad story of a “scheme” that if it was controlled correctly could have worked in your favour… but as its designed to allow everyone to benefit from it financially, it will never be.

            Hope you get well


        • Frank Frick September 27, 2017, 2:34 pm

          I do see where you are coming from, Todd. It’s an overall picture, acting as a caveat. A bit saucy, but colourful opinions are entertaining.

          I think the point about the buy price hiding incentives is real, but it also operates in every apartment development (in Perth anyway) with their cookie-cutter pricing, and nongs keep throwing money at it, even for high-rise. You can’t bargain when nong money is flowing.

          You can do okay income-wise with a carefully selected property, (I’m still cash-positive on 100% borrowing even though rents have dropped 20% in Perth since 2012).

          But there are the uncontrollable unknowns, like who else is in the same complex. If it goes bad, I think a council of the owners is the only way forward. Everyone to quit the scheme and ‘reset’ the quality of the tenants. But would they?

          I’m invested in a complex of 11 one level villas, and have one of the 2 street-front free standing units. So, the place is not boxed into the actual complex. Better for re-sale.

          I’ll hold until the tax rebate/offset expires (this is real; it is what makes it work.)
          I’ll then quit the Scheme to sell. I’d get the rent up to its proper market rate.
          I’d also check out selling it to the existing tenant, but you can see obvious obstacles there.

          • Todd October 16, 2017, 5:46 am

            Hey Frank, thanks for your feedback. I think the point overall is to always do the due dilligence too, there are good and bad stories here, I have heard more bad then good in the case of NRAS though.
            Good luck with your plans.

            cheers, Todd

  • shayne August 12, 2015, 11:41 am

    I don’t think you have done to much research as I have a few investment properties and the NRAS are bye far the best properties .
    there are a lot of your comments that are incorrect like selling your property to just an investor . You can either sell it as a NRAS property to an investor or you can get out of the scheme and do what ever you want with it , just to name one of your mistakes .
    regards Shayne

    • Todd August 13, 2015, 2:14 am

      Hi Shayne,

      Thanks for your comments… Im glad your NRAS are going well, there are a few investors that have had a similar experience.

      In relation to selling your NRAS, if there is a lease still in place… then the tenant must remain till this expires. This varies depending on the Consortium as well… so no not ALL sales can be sold either way. Maybe yours can… but many cannot…

      Cheers, Todd

      • Yvette November 6, 2016, 9:58 am

        K Wooller
        MAY 13, 2016, 3:18 PM
        Hi I was just reading about what you had to say about your number 2 remark, I had to laugh I have a large family whom all own investment properties and have partners, my partner has pass away, a young age I have work in medical profession for many years, full time and haven’t been fortunate to earn great deal of money to own my own home. but have always treated the rental place I have had with the up most respect. I would like to try nras, Sounds to me you are very narrow minded and are judgemental. So maybe one day you maybe in need, Hope you are not treated the way you have just come around in your e mail.


        MAY 19, 2016, 12:25 AM
        Hi Kimmie,

        Unfortunately or maybe fortunately i have seen the ugly side to NRAS… now as the story says, its not all bad in the tenancy sense. Some tenants genuinely need this. The story is directed towards the property side and the sharks that ripped off thousands of investors in the process. It’s just not right.



        Mayumi Nagarkar
        AUGUST 18, 2016, 2:45 AM
        Hi Tod, pls let me know the NRAS ugly side. We are purchasing NRAS since 2011 and having 10 NRAS and buying another 2 properties. We could make over 140k cashflow per year and NRAS is the best scheme for us now to make positive cashflow. I know some of them are sold expensive, but invester will get validation from bank before purchasing the property. If the validation price is low, you just walk away the deal. Also you can negosiate the price.


        SEPTEMBER 2, 2016, 4:56 AM
        Hi Mayumi,

        I think the negative sides were clearly pointed out in the Blog. You must be one of the lucky ones who has been hassle free with your properties. many haven’t received they rebates cheques for over a year.

        Now the investor quite often won’t get validation from their bank. It depends on how the mortgage was written, along with the amount of sales previously gone through that were sold to investors through wrong mortgage structure. So that when the next investor is ripped off, the valuer has prevented proof of the rip off price and can justify their valuation at the high price.

        New houses, nah negotiation is rarely a done deal. These properties were sold through property companies who sell to their investors the line of huge government rebates. That way the investors don’t see the wool being pulled over their eyes.

        Cheers Todd

        NOVEMBER 6, 2016, 9:53 AM
        Your comment is awaiting moderation.

        I am a NRAS tenant, but wish I had never been. I have become sick since living in this 4yr old home nor in Perth. This sickiness culminated recently with ‘confusion’, a fairly scary way to feel. My employer was very understanding. considering I work in childcare, I would have been forced to resign, had the confusion not slowly dissipated (over the course of 1-2weeks). Much research &many medical tests, later.. It seems the building has damp, whether from poorly built cornices and roofing that overlaps, or whether from cracks in mortar and brickwork, or whether, as seems to Also be the case, water rising or being trapped underneath the tiles. As I hastily search for alternative accomodation for myself and my son, I ponder what benefits, if any, this program has provided me, the tenant. I have paid $366 p/wk for two years, an amount that has been way above comparative rentals for at least the last year. CPI increases are built in to the contract, with no mention of rent decreases, as rental affordability improves with over-supply. Fortunately I am out of lease at the moment, making the move somewhat simpler. Meanwhile I have finally been offered the 20% below RRP that I was originally promised. My rent has now gone done to $284. But what price my health? &tgat of my son. Thanx but no thanx. I am also caused to ponder any possible benefit to the owner throughout. My rent Has been high. Apart from that though, the sceptic in me wonders if the owner will even be told of the damp and water problems that are the cause of my departure. My rental is one of eight, specifically built. How will that progress, I wonder. The damp is inbuilt. But eight properties and the repercussions for All may indeed prove too much liability, either for the property managers, or government building contractors, or the government themselves.
        So finances and economics seem to have found a way to affect the health and happiness of those of us less advantaged. (Including others who, like me, look after your children, but are not paid enough to afford private rentals, or indeed the luxury of living in peace. Perhaps that ought to be the questions we ask ourselves…

  • Chloe June 3, 2015, 2:50 pm

    Todd, your arrogance and sense of superiority over people who aren’t as well off is so obvious. Yet you ignore it when people point it out, and sorry but your own experience ISN’T A RESOURCE, they would have tought you that in university if you went.

    There is no point leaving a comment, your you cant hear us over the sound of your own narcissism.

    Xo Chloe

    • Todd June 25, 2015, 10:08 pm

      Hi Chloe,

      I worked my butt off to be in a position where I am today… and no I didn’t go to Uni… I find it a waste of time and money, but hey thats just me!


  • Excel Cash flow February 21, 2015, 3:38 am

    An intriguing discussion is worth comment.
    There’s no doubt that that you should publish more about this subject, it might not be a
    taboo subject but generally people do not speak about such
    topics. To the next! Best wishes!!

  • Derek February 10, 2015, 6:10 am

    I have had a significant dealings with the NRAS scheme as a property manager. I have read a lot of the comments and agree with some and strongly disagree with several ill informed comments however I am not here to defend the NRAS scheme far from it.
    Firstly I took great care in selecting tenants for the NRAS properties to make sure the landlords had the very best tenant possible who was eligible under the scheme. The scheme is designed to benefit families with children not single adults living together. I do live in an area where living is very affordable and the average wage is quite low compared to the national level but I was still able to find very good tenants and pride myself on this fact and yes I did have police officers, nurses & working professionals as tenants.
    The item I would like you to look at is the monopolisation of NRAS properties under management from a specific NRAS provider in the eastern states and the specific qualification required to be an NRAS approved leasing/managing agent and the disadvantage this is having on landlords and tenants alike.

    I think this would make for a very interesting investigation.

    • Todd February 16, 2015, 4:23 am

      Hi Derek,

      What in specific are you looking for? What things have you noticed that look dodgy or not right?

      Cheers Todd

      • Derek March 25, 2015, 4:18 am

        1. Inability for landlords to chose their own agent.
        2. Company nominating themselves as the ‘NRAS approved agent’ hat is NRAs approved?
        2. Incentives not paid or lengthy delays in payment.
        3. Charges applied for ‘sworn valuations’ conducted by companies own people, not qualified.
        4. Charges applied against the incentive ie 7%
        5. Inflated property prices

    • Mark July 19, 2015, 11:32 am

      We brought into a NRAS scheme which the Government backing is total crap as it run by the Department of Social Services, DSS, we brought it through a financial adviser who should and never be trusted ever! into a unit that has structural problems which could cost each owner up to $42K to fix. everyone through this NRAS crap is corrupt, we thought it would be nice to help out people who can’t afford normal rent, now we need to sell our property as we can’t afford to live as the body corporate fees have gone from $460 per quarter to $2K. Don’t ever touch NRAS or anything linked to the Government. if people can’t afford it work harder.

      • Todd July 20, 2015, 12:00 am

        Hi Mark,

        Thanks for your comments and experience on this matter… sounds like you have had a very bad experience here. If your Financial Adviser is a Financial Planner, then they shouldn’t even be recommending property as a form of investing as they are not allowed to under their license… but they do because of the huge kickbacks they received by selling you that property.

        Might be worth exploring that option to see if they were Licensed and Qualified to sell you the property because chances were they were NOT!!!

        And there are legal avenues there for you if thats the case…

        Cheers Todd

  • Kris December 24, 2014, 11:39 am

    you call yourself a buyer’s agent but this article is a joke and shows how little you know about NRAS.
    I could go on and point out all the misinformation you have given in this article, but I wouldn’t bother wasting time stating the obvious. Plus your discrimination against hard working lower income earners is quite disgusting (plus, mind you, this group also includes new teachers, police officers, nurses, doctors and people of other many respectful jobs. How? if you ask, really, don’t bother writing another blog about NRAS in Jan as you’ll just be making a fool of yourself again.)
    I am not an expert in NRAS, but I already know more about it than you. So, doesn’t matter which part of your body you’re gonna stick your fork into, I don’t give a fork, and don’t bother replying to my comment, just as I won’t bother coming back to this page.

    • Todd December 25, 2014, 5:04 am

      Hi Kris,

      I know you say you are not going to come back but i will reply none the same… as i always do.

      Yes i am a Buyers Agent and professional investor. I would like to see where you believe there is misinformation but by the tone of your comments, it would appear you are an NRAS tenant and not an investor.

      This Blog os for property investors, not a place for whinging tenants. There are literally thousands of affordable properties for lease, it might mean though that you rent in a place you can afford. As a home owner I don’t cry poor and pity me because i cannot afford a 35million dollar waterfront property on Sydney Harbour. I own a home where I can afford… SIMPLE!

      At no point have I discriminated against anybody. I have simply stated these neighbourhoods where these so called police officers and nurses and destroying other peoples property… or haven’t you seen them, I fear not!

      And at no point have i ever said I am an NRAS expert… if i were wouldn’t I be in favour of the “scheme”… which by the way has been abolished!

      It would appear the majority have spoken about this “scheme” hence it being discontinued so it would appear it wasn’t what it was suppose to be, which was a place for teachers, police officers, nurses and doctors – as you state to be able to afford properties to live in.

      Cant say I have ever seen an NRAS house with a Police officer as a tenant… but hey, I have only literally seen thousands of these NRAS properties, what would I know…

      and I also done know of any Doctors requiring affordable accommodation. Most of the doctors I know live in lavish homes… but what would I know.

      The new NRAS Blog will be live at some stage in January, enjoy the read…

      Cheers Todd

    • Mr regret January 31, 2015, 2:06 am

      I have a NRAS property and jumped on the looser train , yes incentives were attractive at time , I’m yet to receive my last yr incentive due to DSS new it system currently being upgraded ,was timeframed for end of July last yr , I’ll be lucky to get it before May! That’s 10k plus my tax return waiting to be processed , why should myself and others be tortured with financial stress because of there incompetiance , I’m sure when I signed up the timeframes were black and white as to when state and federal incentives were to be released to investors , with body corp fees due. 2.5k I’ll simply have to pay the interest on late payments as my calculations didn’t allow for government fuck ups

      • Todd February 2, 2015, 11:25 pm

        Hi Mr Regret,

        You are the second person i have now heard that hasn’t received the $10k rebate… look out for NRAS Part II due out shortly… and this will be included.

        It comes down to that word “Scheme”…

        Sorry to hear you are having such a bad time…

        Cheers Todd

        • SnB October 7, 2015, 9:27 am

          Please don’t comment about NRAS if you don’t have invested in a property…this for us was the worst thing that we ever ever ever decided to do to buy into the NRAS Scheme! We have had ours since 2012 the mortgage broker was dodgy, builder was dodgy it was our property getting built though didn’t have a choice of colours of walls, tiles and landscaping. The cost of the house was so over priced that if we wanted to sell the property we would still owe the bank a lot of money. We didn’t have a choice which property management company looked after our property and I’m telling you the one we were told that would are hopeless tenants are always behind and we only find out when we receive the tenant payment summary. The change of property managers change monthly…communication is an issue. We are sick of it all so we notified the property managers that we are withdrawing our house from the NRAS Scheme when the lease ends to find that they want to charge us a $2,200 break agreement fee…yes that right this amount of money! Do all you NRAS investors realise that you have signed a Power of Attorney so that Questus signs on your behalf…yes only found this out last week…you sign so much when you are buying a house…they signed the property agreement and we didn’t receive a copy and only found out about the $2,200 last week also. So NRAS investors check your property agreement or ask for it because you may never have received it and you are not aware of what you have to pay if you try to get out of the NRAS scheme…though the Government website says they don’t charge you a fee to get out of the scheme though these dodgy property management organisation do! And receiving the incentives well that’s a crock as a previous comment said the 13/14 year tax document wasn’t received until May or June 15 and then for you to receive the state government portion you have to pay Questus a few hundred dollars before they will pay it…biggest joke this scheme. We will be glad when we are out of the NRAS scheme …we thought we were helping people that were in a similar position as us when we were on one wage while having kids though we have had people who haven’t paid the rent for 3 months though we are over it and want out asap!

          Good on you if you have had a good experience though these are far and few between!

      • Vivienne March 5, 2015, 3:35 am

        We too are still waiting for our payment, tax still waiting to be done and have paid the last 3 bodycorp payments on a high interest credit card!! We paid $320000.00 for our unit which is now only worth $220000.00. We cant go anywhere or buy anything except food, fuel and pay bills. We have never been so broke since we signed up for this so called good deal. NRAS sucks.

        • Todd March 5, 2015, 4:47 am

          Hi Vivienne,

          Ouch, not fun at all… sorry not much i can say to help here

          Cheers Todd

          • YIN April 11, 2015, 3:15 am

            My family and I as NRAS investors, too, are still waiting for our 2013/2014 incentive payments from the government. We bought an NRAS apartment in Melbourne under Ethan Affordable Housing back in 2012! This feels like a huge rip-off!

          • Todd April 12, 2015, 11:15 pm

            Hi Yin,

            Thanks for your email… this problem looks to be bigger than first thought. Sorry to hear its not working out.

            Cheers Todd

  • Steve December 15, 2014, 1:26 am

    Your disgusting comments regarding low-income earners are exactly the reason the rental market in this country has become a total joke. Rich investors getting richer off the poor with ridiculously over-inflated rents and the Australian dream of owning ones home now a complete impossibility. You make me sick..

    • Todd December 15, 2014, 1:48 am

      Hi Steve,

      Please explain the disgusting comments… NRAS allows lower income earners to have a 20% reduced rent and in many cases the rent does not go up as per contracts so the tenants get a free ride… I believe your comments are ill informed and you are speaking emotionally.

      But please tell me about how it is good for low income earners to trash other peoples property?

      There are many affordable properties to lease for low income earners in the areas they can afford to live in. The same applies for First Home Owners who whinge that they cannot afford the inner West etc… you buy where you can afford to buy. Maybe tenants and buyers should adjust their expectations

      This Blog is property related and perhaps you should read other Blogs more appropriate to the topics you are looking to research. But I do recommend you read my Blog early next year which is also on NRAS and the problems with the “Scheme”.


      • simon December 15, 2014, 3:55 am

        id like to see your sources todd, for example you claim that a property you know has lost 25% but how can you back that up? maybe some links, or rpdata information if you wouldnt mind?

        i also think there is a lack of understanding and alot of assumptions that have been put into your writing, for example you assume that these low income houses will “trash” your property, these risks are present with any tennant in any property anywhere in the world. the rental tribunals are concerned about specific criteria, and no one can force you to keep a tennant in a property when the tennant has breached their contract( i.e not paying rent, if its otherwise please state your sources).

        finally, you state several times todd that these are less favourable neighborhoods but i submit to you that this scheme is not as substantial as other options we have for lower income citizens such as the housing commission, which itself though has some effect in many places can be considered negligible.

        so where are you getting your information from?

        • Todd December 15, 2014, 4:31 am

          Hi Simon,

          I am a Buyers agent along with a mortgage broker… so therefore a lot of what i have mentioned is from personal experience. So that is my proof – pretty simple…

          Feel free to read many of the comments from investors, real estate agents and property managers who are all in the industry and back me up – again more proof!

          The drop in value of 25% was from a client of which we had to re-value their property for their finance and the valuation came in 25% lower than what they paid. I am not going to post my clients property address, thats a privacy breach.

          At no point do i assume that the tenants will trash the property. But I have seen many that have been trashed in NRAS. I am quietly laughing at your comment re: tribunal – feel free to read my new NRAS Blog early next year where we visited and documented an NRAS house in Sydney that trashed and how long it took for the “tribunal” to act. There is a bunch more fun stuff going to be in this Blog which you will also probably find BS and offensive but it is all real…

          In your Finally statement you mention that NRAS is not as bad as other options for lower income earners such as housing commission. That is correct but the key difference is that my Blog is about NRAS not housing commission and that private investors do not own the properties that tenants in housing commission live in. And thats pretty important!

          So as stated above my sources are from my own clients, my personal experiences flying around Australia and personally seeing these neighbourhoods and those comments from professionals in the industry that have commented in the many comments on this Blog.

          And feel free to read my new NRAS Blog in January…

          Cheers Todd

  • Sky Jones November 27, 2014, 11:58 am

    Found this website after looking up pros and cons of the nras. I have had a interesting day. I am a tenant and me and my parents have been renting for the 21 years. I signed my dad up for the nras scheme. Well we went to look at some nras rentals for the first time today. They were situated in Mountain Creek Sunshine Coast. In the Brightwater Water Estate. A 3 bedroom house for 376 and a 4 bedroom house for 396. While the price was good I was just appalled at the kind of people that rocked up. I was embarrassed to be standing there.

    We usually just rent townhouses or units. But because of the price we thought we would take a look. But my parents liked it. I cried all the home because the area is just so crap. Because there is 3 of us. We all have to put in a application. It turns out that with my income from my disability pension and mums and dads income we actually don’t qualify. I have never been so happy.
    As a tenant I would be worried about the agent and owner. If the owner is going to give there house to the nras for 10 years. Then clearly he isn’t really going to care about on going issues to do with the house. Its not likely they would have brought the house to live in it in the future. So the incentive to care about it disappears. You would have to a very good agent which is really hard to find. Also don’t like the fact that the leases today were for 2 years.

    • WGadmin123 November 27, 2014, 10:15 pm

      Hi Sky,

      Thanks for commenting from a prospective tenants point of view…

      Cheers Todd

  • Trisha August 31, 2014, 2:41 am

    The following website has a lot of information for investors under the NRA Scheme ►

    ……but no help, information or disclosure about the NRA Scheme for private purchasers who buy a property in the same complex/address as those properties who come under the NRA Scheme and then suddenly find out that they were overcharged in the first instance and secondly their newly purchased property is worth a lot less than they paid for it, making it completely impossible to get what they paid for it if they decide to sell after a year or so.

    • WGadmin123 September 2, 2014, 12:40 am

      Hi Trisha,

      Yes thats a huge problem… and sounds like what many investors are experiencing with many more to come

      Cheers Todd

      • Trisha Fitzsimmons September 13, 2014, 7:16 pm

        Hi Todd

        Would you kindly advise what percentage of dwellings in new estates/strata listed estates, is the NRAS allowed to have in proportion to private purchasers who want to live in their property. I’ve heard that the maximum allowed for NRAS is 30% of the total dwellings in any one area. Is this correct?

        • WGadmin123 September 15, 2014, 2:15 am

          Hi Trisha,

          I don’t believe there is any limit… I have seen developments where the developer couldn’t sell the remainder of the units locally, and was then approached by NRAS on seller who was able to get the high percentage of remainder units approved for NRAS. Once completed the the medium density complex was 80% NRAS 20% owner occupied. And none of the first 20% of owner occupiers were consulted or told about the rest of the units being sold as NRAS… very poor practise indeed.

          Hope this helps… Todd

  • Steve August 21, 2014, 1:15 am

    Hi Todd,

    I just came across your article relating to NRAS and thought you may be interested in my opinion on NRAS as it affects prospective tenants?

    I’ve sent various versions of the email below to the Federal Minister for Social Services (Kevin Andrews), the Western Australian Minister for Housing (Bill Marmion) and the Federal Government Department responsible for NRAS.

    From a prospective tenants point of view, it seems to me that the whole scheme is a croc!


    From: Steve
    Sent: Wednesday, 20 August 2014 10:09 AM
    To: ‘’
    Subject: Query regarding setting of Income Limits vs Rental Valuations on NRAS listed properties

    Dear Sir,

    I am contacting you regarding concerns I have in relation to the National Rental Affordability Scheme (NRAS).

    My daughter and her boyfriend recently investigated the possibility of leasing a property in Perth, W.A. that is being offered under this scheme. They have told me how frustrated they are by the conditions that apply to the lease of this property under the scheme.

    The property in question is a new 3 x 2 Townhouse located close to my own home in Canning Vale. The owners/property managers are advertising the property for rent at the rate of $356.00 per week.

    The issue is that as far as I can see, anyone who HONESTLY indicates that that they earn under the entry level income on the NRAS leasing conditions ($65378.00 in this case) would simply NOT be able to afford to live in the property.

    It appears to me that either the entry level income thresholds have not kept pace with rental values and the cost of living, or the owners & property managers of some properties being offered for lease under NRAS are setting rental rates too high.

    I have run some figures (Spreadsheet attached) that I am fairly sure are a reasonable reflection of typical living costs that apply to my daughter and her boyfriend or any other young couple in today’s society. My estimates show that after paying for rent and the other basic necessities in modern life, there is simply no money left for anything approaching a “life”, let alone allowing for savings or emergencies.

    When I approached the managing agent of this property, I was told that they have many properties already leased under this scheme and that these existing tenants are apparently not having any financial issues. It is my opinion that the only way this can be, is if these tenants have falsified their leasing applications and/or subsequently brought other borders under the roof to help share the costs.

    I would appreciate it if you could take the time to look at my calculations and indicate whether or not you think I am realistic in my estimations? If you do believe my figures are reasonable, could you also please advise what, if anything can be done to either bring the NRAS income thresholds into line with the cost of living, or impose upon property owners/managers to do the right thing and set reasonable rental rates?

    Many thanks for your consideration.


    $65378.00 – Allowable Gross Annual Income (Initial) under the NRAS Scheme for Two Adults

    $1257.27 – Allowable Gross Weekly Income
    $272.00 – Weekly Tax (based on ATO Tax Withheld Calculator)
    $985.27 – Allowable Net Weekly Income

    $15.27 – Weekly Income remaining after deduction of Typical BASIC Weekly Living costs listed below

    Typical BASIC Weekly Living Costs for Two Adults
    $356.00 – Rent
    $10.00 – Power
    $8.00 – Gas
    $3.00 – Excess Water
    $250.00 – Food & Groceries
    $249.00 – Fuel & Transport (Per table below)
    $64.00 – Private Health Insurance
    $30.00 – Phone
    $970.00 – Total Typical BASIC Weekly Living costs

    Weekly Fuel & Transport Costs (For 1 x Adult)
    $37.50 – Vehicle Registration
    $22.00 – Vehicle Comprehensive Insurance
    $25.00 – Fuel
    $40.00 – Public Transport
    $124.50 – Total Weekly Fuel & Transport Costs

    • WGadmin123 August 26, 2014, 8:50 am

      Hi Steve,

      Thanks for your comments… it is also great to see a different angle to this argument. Looking at the figures you have above, clearly shows that they cannot afford the rent on that property…

      There have been earlier comments saying that the level of income for NRAS is up to $110k, is it different in WA? Sorry not sure on the answer to that one…

      Cheers Todd

  • Hellen May 10, 2014, 1:42 pm

    Currently I am a mortgage broker but in my previously life I was a property manager. Half my portfolio was NRAS, the other half “normal” investment properties. I have read through a number of your comments and would like to respond by saying you do NOT exhibit a clear understanding of NRAS tenants. Your uneducated comments may put off potential NRAS investors. BTW I am also based in Perth. My NRAS tenants very rarely appeared in my daily arrears list. They need to jump thru a number of hoops to be eligible for one of these properties. They are very appreciative and understand how fortunate they are to be paying rent 20% below market value.
    Feel free to contact me if you would like to discuss further.
    Your comments about kickbacks etc happen with properties regardless of whether hey are NRAS or not. The value of the property is independent of the developer or seller. All properties receive an independent bank valuation and the price is required to be market value otherwise the lender will not participate in the deal. The tax incentive is a bonus which allows most NRAS properties to be cash flow positive.
    Many of our NRAS owners owned 2 or 3 properties nb. They were not purchased at the same time – they added to their portfolio over a number of years – all my owners spoke very positively about their NRAS experience

    • todd May 11, 2014, 12:59 am

      Hi Hellen,

      If you hadn’t noticed, my Blog was intended to inform investors of how bad NRAS properties are… if they still purchase after this then at least they go in knowing the pro’s and cons.

      Unfortunately you incorrect on a few matter here. My comments are not uneducated. I have seen at least 50 NRAS concentrated communities and my comments are based on my findings. Can I ask how many you have seen? or are you judging your comments on the few you managed??? I fear the latter.

      As your occupation is a mortgage broker support officer I am surprised you have said that independent valuations are conducted on all deals. Are you telling me that you have never written a loan where the banks used a desktop valuation or do no valuation at all??? This happens all the time, and more so when LVR’s are 80% or below. It also happens when investment purchases are cross collaterised with another property like a home with huge equity available. And the NRAS onsellers know this and pray on this, and thats how they get away with the huge kickbacks on offer, up to $60k per property. And at $60k that equates to 6 years of the tax benefits… not worth it.

      Yes kickbacks occur on all properties but many investors get blindsided by the $10 rebates on offer and see past this… so it occurs a lot more with NRAS properties.

      I have posted some of these great houses on our Facebook page should you care to peruse… but by some of the wording in your response, it would appear that you are a mortgage broker support officer that works for a firm that writes a reasonable amount of NRAS. Do you have connections with companies that sell NRAS?

      We have 3 responses on the comments section of this Blog that are from property managers and both wouldn’t touch NRAS and have turned down many applications from vendors who own them. Thats says a fair bit about these properties…

      Rather than me calling you, I am happy to debate this out on a social media platform if you would like?

      Looking forward to your response… Todd

      • Hellen May 17, 2014, 6:15 am

        Hi Todd,

        In regards to your question regarding valuations – EVERY property is valued by a licensed independent valuer appointed by the lender – no deal proceeds based on the purchase price. This is why NRAS properties must stack up regarding purchase.

        On occasion, property vals have come in lower than the purchase price (this has not occurred on an NRAS property) – the only option is for the seller to lower the price otherwise there is no sale, unless the purchaser decides to cough up the difference from their pocket. You purchase an NRAS property like you would any other, the maths needs to stack up and the $10K per year is a bonus.

        Regarding cross-collateralisation: unless it is absolutely necessary, this is infrequently done. Less than 5% of our clients would cross-collateralise their properties. We always encourage “firewalls”..

        In regards to NRAS PM turning down NRAS properties – you are not allowed to manage NRAS properties unless you are accredited to do so. There are a limited number of companies in WA that are accredited, so the number of Property managers that have been fully exposed to this scheme is very low.

        As I have said previously, NRAS has been a great scheme for all involved – the construction industry, the government, the investor and the tenant. It was designed to give a boost to the construction industry and it has been successful in doing this…

        I don’t work for an NRAS company that writes NRAS loans … I use to work as a property manager managing the NRAS properties and the tenants. I have yet to meet an “unhappy” NRAS owner – once they had purchased one property, majority of them went on to purchase 1 or 2 more over the subsequent years.


        • todd May 18, 2014, 12:51 am

          Hi Hellen,

          Wow… do you really believe in your own words… EVERY lender does desk top valuations, drive by valuations, Valex Vals and use Contract of Sales for valuations under certain circumstances.

          Now when I say EVERY, I mean EVERY… including all the majors, CBA, ANZ, Westpac, NAB & St George. I will as far as say that almost ALL purchases that are at 80% LVR do not do valuations unless they are an unusual security.

          And Yes Helen, I can say this as I own a large mortgage broking business…

          But I guess everyone has now seen the “scheme” for what it is because NRAS has now been abolished in the last weeks budget… Can’t say i’m not happy about this.

          But it will reduce the NRAS property values even more…

          Your comments in PM are also incorrect, you are simply stating what your friend had to go through… fell free to read all the comments in this Blog as there are several PM’s who have personally commented.

          How did it boost the construction industry, all stats say building figures are down and never increased in any significant value. I think you should do some research here…

          Again feel free to read about current NRAS owners who are VERY unhappy… I am sure there are a few happy ones but in general I have found it hard to find any

          Cheers Todd

          • Hellen May 18, 2014, 2:30 pm

            Well Todd – I think I will leave it here… however, I will say this. I have just had dinner with a builder from a well known company in Western Australia. The construction industry is having huge problems finding brickies and other tradies. Currently, brickies are being paid 30% more than normal. The construction industry cannot keep up with the demand. This is what is happening in WA. When I talk about NRAS, this is what is happening in WA. Consortiums in the Eastern States are advising investors and strongly encouraging them to purchase/build in WA. My comments are made in relation to NRAS in WA… Your comments implying that NRAS was stopped due to it not being a successful scheme are incorrect. Like all policies implemented by other governments, they can be stopped just as quickly for any reason they choose – rightly or wrongly this government is stopping the handing out of money – NRAS was just one policy on a long list to be given the boot…

          • todd May 18, 2014, 11:57 pm

            Hi Hellen,

            I think your WA problem stems far further than getting qualified tradies to work on construction. WA has employment issues with sustaining employees and not losing them to the north in the mining game. It’s a problem for all industries but especially tradies as they can earn far more up north than dow south. Brickies been paid 30% more has occured several times in WA in the past, but the real issue is because they can earn this extra 30% all the time up north.

            As a PM of the past you would know about how hard it was for PM’s to stay in their job… many also left for up north chasing the dollars. Which is why PM is sooooo expensive on WA compared to the rest of Australia, labor costs… I know many PM’s in WA on $80k plus phone plus company car plus incentives

            I believe you have made judgement on one builder becasue if you look at the stats – it shows only a very tiny increase in construction in WA, not enough for builders to say they cannot keep up with demand.

            Your comment in Consortiums advising investors to purchase in WA – is there anywhere I can up more on this?

            Yes all policies can be stopped but did you notice that there was no fuss about the NRAS scheme… no fight to keep it, no media play… says a lot

            Cheers Todd

      • Jessica January 24, 2015, 12:50 pm

        As a senior property manager of 9 years solid experience within residential realestate in Melbourne Cbd and inner suburbs, I can so advise I would not touch any NRAS properties.
        There was a brand new building just off City Road South Bank that was approx 50% NRAS. I was leasing out two bed, one bath apartments with bay views and carpark for $500 a week whilst the NRAS were renting at $350 per week. Huge difference. Not 20% at all. What sort of rental yield valuation is that?
        My tenants were professional singles and corporate type couples with no issues.
        I also had some younger country girls going to uni who’s parents were responsible for everything.
        Within a few weeks I had the family in my office demanding to know why drug deals were getting done in the foyer, cars getting broken into within a secure carpark, domestic issues all hours of the night ect.
        Never ever again. It was a nightmare
        Whilst from my experience I know all too well there are good and not so good tenants, regardless of their socioeconomic status.
        But what I found was that the agents employed to lease these properties were on special exclusive agreements within the NRAS scheme and didn’t give a rats about who they actually put in the property. Yep they might ‘qualify’ but the agents only wanted the leasing fees and whatever kickbacks the scheme was giving them.
        If I have a tenant who can afford a property but they are an ass or somewhat unsavoury in nature they don’t get the property. Not only do I have up deal with them but I have to deal with everyone’s complaints.
        I think the scheme initially had good intentions but for genuine property investors who actually want their property to work for them, both in regards to initial outlay and ongoing income, can do a lot better.

        • Todd January 27, 2015, 2:25 am

          Hi Jessica,

          Well said and thanks for your sharing your experiences with NRAS…

          Cheers Todd

    • Anonymous NRAS SA July 18, 2014, 5:38 am

      I’m very disappointed to see that the NRAS property I bought 3 years ago is $60,000 overpriced! How did I know? Because I saw yesterday the developer is selling 5 similar properties next to mine at $60,000 less than what paid for! They made a killing. How do you explain that Hellen?
      Todd, you have some good points. My first NRAS tenant defaulted in rent. But the second tenant has been staying there for more than a year now with no major issues.

      • WGadmin123 August 25, 2014, 1:24 am

        Hi Anonymous,

        Exactly what has happened to you is what the problem is with NRAS… The $60k that you paid over and above the value of the property will take 6 years of the ten years you receive your $10k tax advantage to get back to even only… it will actually take longer than that as you have to drop your rent by 20%-25%, so its more like 7 years…

        Good to hear that your 2nd tenant is paying the rent on time…

        Cheers Todd

    • Jakob July 30, 2014, 4:28 am

      It’s true that low income earners are the ones lucky enough to secure a lease in an NRAS apartment. I am one of such persons. The criteria is that they earn less than $47,000 per annum. But, I am a BCom Graduate and working full-time hours and only secured the property after filing a good 25 pages+ of application and other data forms for scrutiny by the agent, before scrutiny by the investor – before being approved for the brand new unit.

      The rental market at the moment is way too expensive (considering the only perk to living in Perth is that it’s close to the mines / beach) – but far from EVERYTHING else. If the high rentals prices here aren’t enough of a wound, the savage competition to secure a “cheap” lease is just salt and vinegar for that wound.

      NRAS has provided a golden opportunity for people like me to live in a nice apartment. But it’s a God-send considering the poor options available around the place. I can’t express clearly enough how glad I am to find this place. It’s a reward for putting up with all the BS thrown at me by the stupid rental market here.

      • WGadmin123 August 25, 2014, 1:15 am

        Hi Jakob,

        Thanks for your comments… sorry about the delay but we have a new website and Blog set up and i needed to learn it before knowing how to come back to you… Glad to hear it is working out for you. There are certainly a genuine need for some tenants to be given affordable rents and the bonus is that you are able to live in a new unit.

        Cheers Todd

  • Vee May 5, 2014, 10:53 am

    I found your blog both informative and very eye opening recently researching NRAS properties, it interests me however I am sceptical.
    I have dug deep down to the itty gritty of it all and the way it works as a potential investor its like any other investment run by a major company inflated prices for guarented rent sorry if my mispelling gets out of hand leaves a lot to be desired I guess to sum it all up if you are presented with a picture and presentation your sold the wow factor of a property, I like to investigate my areas thoroughly seeing that you google the vacancy rates for apartments and the likes makes me cringe seeing for example the CBD in Melbourne has high vacancies and sellers I see this a lot, people are off loading property every third to fifth property is on the market in growth areas after two years I cant imagine if a situation came to hand before the ten years is up this NRAS property was to be offloaded if it was too good to be true would there not be more people on board selling these, to the people on here that sell these properties I can tell you that over inflating your properties will eventually lead to prosecution as I have seen this happen to someone here in Melbourne.

    Todd can you tell me why charitable organisations are involved in this scheme if it is suppose to be aimed at middle class earners this is where it gets confusing as the DHS is heavily involved in this scheme I have found a list of all the suburbs across Australia that are NRAS approved and I am going to go and phsically see these locations I will get back to you with my judgement on these areas.
    can you email me some growth areas you recommend in Melbourne. NON NRAS of course.


    • todd May 5, 2014, 10:51 pm

      Hi Vee,

      Glad you enjoyed the read… I totally agree, the concept is sold on the tax benefits and the sharks are inflating the prices. I posted another example of a bad NRAS sale on our Facebook site last week… about three posts ago…

      I am not about the charitable orgs getting involved… couldnt comment there.

      The sale of these properties when the 10 years is up will be very interesting, the market will et flooded each year and all these PRO NRAS supporters will see the “true” value of their investments… and thats probably when I will pick up some of them after the NRAS and buy them ultra cheap, like I always do.

      Currently I have no locations in Melbourne I like… the yields currently are simply no good, over supply

      Cheers Todd

  • Matt May 5, 2014, 10:24 am

    Does anyone feel stupid now reading this and taking so much time to write all these comments?? only to find out that the Australian Government once again fucked up, and cost Tax payers millions of dollars that mostly went back to foreign capital investment firms.

    Most of the profits mainly coming from the development and leasing of student accommodation to foreign students. Australians are so hung up on the idea of trying to make it hard for one another to succeed that while we battle it out, a slippery company sneaks in the back door and takes us all for a ride.

    • todd May 5, 2014, 11:07 pm

      Hi Matt,

      You won’t hear and of them saying how bad their investment was, they simply fade away into the shadows… and the NRAS sellers will then jump onto the next “scheme”…

      I must admit, I love the way you have worded this comment, straight to the point, tell it how it is… awesome… Cheers Todd

  • Dave April 6, 2014, 12:15 am

    Are you serious? Yes there are some drawbacks to NRAS properties, but there are drawbacks with any type of investment. $10k tax free for 10 years in return for accepting a lower level of rent (and a few other restrictions) sounds like a great deal to me!

    I’m not sure how you’re confused with the $7,486 tax offset. Offsets are not gross/net, it simply reduces your tax payable by that amount. Offsets can be refundable (i.e. if it takes your total tax payable below $0, you still get the benefit) or non-refundable.

    Many properties are overprices, so be very careful there and yes, many areas (Gold Coast for example) will end up with a heap of NRAS in certain areas.

    There’s a great reason not to own 10 NRAS properties. These are highly tax effective, and the more you own, the less tax benefit you’ll receive from ending up in lower tax brackets.

    You do (generally) have the ability to sell before the end of the 10 years to whoever you want. You might just incur an admin fee for removing it from the NRAS program.

    There are plenty of other mistakes here, but that’ll do me for now.

    BTW, I’m a financial adviser…

    • todd April 6, 2014, 11:47 pm

      Hi Dave,

      Yes there are negatives to any type of investment… being a financial adviser you would see this everywhere. But with NRAS where pushy sales people can use the sales line of tax offsets, clients can oversee the other major problems with this scheme.

      I am not confused about the tax offsets at all… I am not sure how well you understand this as you commented that you wouldn’t own 10 NRAS because you might make an income from the tax offsets. Isn’t that the point???

      Being in a lower tax bracket does not affect the $7k payment you receive…

      The rebated amount is the same irrespective of however much you earn, so if you could own ten and they were fantastic investments… wouldn’t that make sense?

      Well it would except for the huge downsides of the scheme… might be why there is a huge investigation into the scheme and its future…

      Then there are those in the program who are abusing the scheme… (no that wouldn’t happen…) who are building properties to let them out to NRAS students from overseas who are very wealthy. Can you see the honest area it is… NOT

      I ask though, do you offer NRAS to your clients?

      Cheers Todd

  • Ellen March 28, 2014, 8:59 am

    Hi Todd,

    Your article raises a lot of things I have been worrying about.
    I’m on the verge of committing to an nras opportunity in Gosnells in Perth, it’s a 2 bed 1 bath in a complex of 12. All NRAS. There’s other development happening in the same area, at least one additional 12 unit nras complex, the rest I assume to be private. The unit is being marketed as $325k, market rent $350 reduced rent approx. $290.
    I’m confident the price is marked up by at least $7k ( previous 2 bed options with a loft have sold for $319k) so this is the last loft option in the complex further away from the rail ( approx. 200m and shielding from noise by surrounding houses) so I think they’ve upped the price. Same product closer to the rail in other NRAS complex is $309k. I was thinking the incentive money would absorb the additional cost.
    Do you think a 12 unit complex could fair better even if all low income occupiers?
    I’m on the band wagon that there’s a property bubble happening moment with interest rates being so low, so normally I wouldn’t considering a property investment at the moment as I’m not convinced there’s much growth left in the market. Again I thought the $100k incentive slightly protected the investment from a downturn.
    What are your thoughts?


    • todd March 30, 2014, 10:07 pm

      Hi Ellen,

      Literally 5 minutes down the road I was investing in Seville Grove ad Brookdale and was purchasing houses for $270k-$310k… there are still houses available for early 300’s so why would you buy a unit for a dearer price?

      Your comments have a feeling of that you are definitely not sure and for me gut feel is the last and most important of all research… if it doesnt feel right, the walk away… either there is something wrong or you are not in the right head space for that property.

      Paying more than you should for a property is never good, but never try to justify it to yourself that you are getting the $100k back over 10 years “so it will be OK”… they are two different factors at play.

      I’m not a believer of a bubble but I do see Sydney and Melbourne experiencing a string cool off starting later this year and continuing for a few years.

      There are however many places where you can still invest and get a great deal, I am working on 4 locations currently and still securing some great buys… there are many markets in Australia and they are all not performing well. Great location wrong part of property cycle = great buying…

      Hope this helps…


      • Ellen March 31, 2014, 9:13 am

        Thanks Todd, any suggestion on locations that would be worth considering at the moment?

        • todd March 31, 2014, 10:32 pm

          Hi Ellen,

          My secret is where I invest… If I told everyone where my secret locations are then i would be creating my own competition when purchasing houses. When investors come on as clients we talk locations and more importantly why i am investing there. I can say we are in 3 locations in QLD and one in WA.

          Happy to chat on the phone if you wold like?

          Cheers Todd

  • Matt March 21, 2014, 10:05 am

    Todd, thanks for your shit story on NRAS, I am 24 years old and have just received 40 incentives under the scheme for a property development I am perusing in Northern NSW, all I can say to you is have you ever heard of Uni Students?

    • todd March 21, 2014, 1:41 pm

      Hi Matt,

      Yes I have heard of Uni Students… from your comments its looks like you are building the development???

      If so then this story really doesn’t relate to you…

      But what I would say is that:
      firstly I wouldn’t want to own a unit
      Nor own one in Northern NSW
      Nor rent a property I own in a development full of NRAS
      Nor own a property full of Uni Students

      It has problems written all over it…

      But good luck to you anyway… Todd

  • Ellie February 25, 2014, 12:13 pm

    Interesting article. We have been looking at this scheme ourselves after a mystery ailment took my previously healthy and active husband, and in a 3 month period, put him on oxygen for 16 hours a day waiting to be assessed for a lung transplant.

    We moved to Toowoomba from Brisbane 3 and a half years ago because it was more affordable to us rent wise but now need to be in Brisbane to be close to specialist treatments.

    I think the NRAS sounds great on paper but I’m wary of it for the same reason I’m wary of applying for housing commission homes. I would love the affordability side of it but I also want to raise my children somewhere that feels safe and somewhere where they are surrounded by people who work and strive for a better life. I understand how judgmental that sounds but I’m only going off the experiences of what I have seen first hand.

    I thought they learnt from the Housing Commission debacle that ruined entire suburbs, that piling these sorts of housing together was a bad idea?

    I know they say beggars can’t be choosers but I’m a pretty creative beggar so i’m sure we’ll find the right option for us 😉

    • todd February 25, 2014, 9:48 pm

      Hi Ellie,

      Thanks for your comments… I hope all goes well in your endeavours.

      Yes we do make decisions on what we see and I don’t think many people have seen these communities and how bad they can be.

      I am sure you will find what you are after, if you are determined enough it will happen…

      Cheers Todd

  • Nessa Ness February 24, 2014, 6:40 am

    I have been currently renting a nras townhouse in Currumbin waters for the past 2 years. The townhouse was has been up for sale the whole time I have been renting it, only last week someone bought it, they are scraping the nras scheme and are planning to move in. I have been given 2 months notice to vacate.

    • todd February 24, 2014, 6:46 am

      Hi Ness,

      So where does that leave you? Do you get an opportunity to live in another NRAS property?

      Regards, Todd

  • Jason February 20, 2014, 3:10 am

    After stumbling along your blog and reading a few comments. I entirely agree it is a total sham from the points of view of the investor and tenant.

    NRAS is not the only disaster project created by our government as some community groups (registered charities and etc.) appear to be starting to exploit this as part of their community housing programs.

    Along with foreign ownership and various homeowner grants, also being exploited. And the excessive amount of red tape involved, it doesn’t improve the situation either.

    It’s no surprise to why the market is over inflated and beyond the reach of many, regardless if you intend to rent or purchase.

    The Australian Dream these days is having a roof over your head, The Australian Nightmare is owning or locating a property.

    Also one should question the whole scheme as it’s now only applicable for the working poor as those on welfare or pensions are starting to be pushed out of the NRAS market anyhow.

    Imagine what it’s going to be like in 15-20 years time when the “Baby Bonus” adults start hitting the rental market as the property market then, will be virtually impossible to enter into.

    Scary times ahead indeed…

    • todd February 20, 2014, 6:23 am

      Hi Jason,

      Yes it is indeed… wherever there is a “scheme” there are sharks who look for ways to exploit it. We will see the true negative effects in time. This monster will show its ugly head at some stage and by then these sharks will have moved onto the “scheme”

      Cheers Todd

  • prabhakar January 16, 2014, 12:37 am

    Hi Todd,

    Thanks for reply.
    Purchase price is 675K. rebates around 7k will be given by Landcorp after settlement.
    rental return is 550 per week for each 2 bed room. so it is 1100 market rate. discounted rent is 880 per week + 400 from NRAS.


    • todd January 16, 2014, 11:30 pm

      Hi Prabhakar,

      The number look Ok on this deal from the outset… I a still skeptical on Cable Beach and of course NRAS.

      Cheers Todd

  • prabhakar January 9, 2014, 6:33 am

    Hi Todd,

    Read through your article along with various other view points, How about buying a property in Cable Beach WA 2 BR +2BR ( two on one title).It is Dual NRAS and how difficult it will be to sell after 10 years of NRAS as it on one title.

    • todd January 12, 2014, 10:40 pm

      Hi Prabhakar,

      To make a better judgement I would need more info like purchase price and rental return…

      Having said that i have never seen an NRAS property that I like, its not just the numbers, it’s the quality of tenants you will possibly have. And Cable Beach is on the outskirts of Broome which has a small population making it hard to resell the property again at a later stage unless it is sold to an investor…

      Hope this helps… Todd

  • Todd January 7, 2014, 1:36 am

  • Joanna December 19, 2013, 3:45 am

    Hi Todd,
    I am currently buying a NRAS property(unit) in Elanora Heights. This is my first investment property and I am not sure if it is good idea or not after reading your article. I am paying $600k for a 2 beds with tenant in it already. The discounted rent is $490. The building has 22 units and half is NRAS. I have met the tenant and she looks very nice and she makes the unit looking very nice too with very nice furniture and decoration, she does not look like a low income earner at all. I have also met another NRAS tenant in the other unit, she is a childcare teacher and living with her husband and a child. They all look very pleasant. Elanora Heights is a very nice little suburb in the northern beach in NSW. I could not imagine the low income earners like you said would trash the building in such nice area. Anyway looking forward to hearing your thought.
    Best regards,

    • todd December 19, 2013, 4:45 am

      Hi Joanna,

      Thanks for your comments…

      My first thoughts are that it seems like an expensive purchase for an NRAS property. Sure the tenants can afford the rent now but can an NRAS approved tenant afford the rental increases that your unit should receive? My understanding is that the max income they can receive to be approved for NRAS is $1,473 net income per week ( not sure how that is a low income earner, but anyway). So when I calculate that tenants affordability i use 33% of their net income = $486 per week.

      Meaning they are already past the line of affordability in my calculations… so therefore every extra $10 the rent goes up, it starts to hurt.

      I did some quick numbers on your behalf and pending how much cash deposit you are putting towards the purchase, the property will be borderline cash flow neutral. This is including the tax rebates you receive.

      The purpose of NRAS for investors was to have a passive income coming in from the property, this purchase won’t have nor have much in the way of rental increases.

      So there are some brand new 2 bedroom units for sale in same suburb for $635k, which will have a little room for negotiations and looking at rents you would receive $750 per week. Doing some calculations the property would be slightly cash flow positive.

      The end cash out of pocket result being approximately the same but without the risk of NRAS nor the possibility of paying hidden kickbacks…

      Now yes the tenants in that unit may be nice and not trash the unit but you wont know who your neighbours are if half are NRAS and this could devalue the property quite significantly…

      Food for thought…

      Cheers Todd

  • Joanne November 30, 2013, 2:31 am

    Hi, I was considering renting a NRAS unit on the Sunshine Coast Qld,yet my gut feelings were, the unitblock might look nice now, but give it time and it would turn into a ghetto.
    Also the rent is not cheap there are plenty of rentals on the coast that are the same price and your not living in a shoe box.

    • todd November 30, 2013, 10:33 am

      Hi Joanne,

      I think you have made a good choice… and with the amount of available properties for lease you should be able to negotiate a good deal on a normal property.

      Cheers Todd

  • Brad October 29, 2013, 9:59 pm

    Hi Todd,

    so do you recommend new house and land packages or already build houses?

    • todd October 31, 2013, 4:54 am

      Hi Brad,

      No we don’t do new house and land packages… we only buy existing properties.

      Cheers Todd

  • Julian September 10, 2013, 7:34 am


    I can see the merits of a lot of points raised by you and others. I think you need to be sure of the property first and nras should be secondary. I have recently looked at a unit complex in Fairfield in Brisbane which has about 39 x 1 bed rooms. It was only when I inspected this property that I became aware of the nras scheme…although I had heard of it in the media. 13 are in the nras pool spread throughout the complex. Units are priced between about 330 – 345k. It’s a central location: close to cbd, pa hospital, uni of qld, 2 railway stations, it,s elevated and some units have a reasonable view. The nras scheme seems like it adds real value to the proposition with the 10k incentive. My concern is more about the product. They’re more like a studio with sliding/folding door/wall btw bed and kitchen/living. They have large size balconies of front and rear. The balcony off the living would have to be the dining as it simply wouldn’t fit in the living. I think the internals, which is only 42sqm, would probably appeal to gen y…they’d probably think it’s cool…but not to traditional buyers and the actual set up of the wall maybe easily damaged or malfunction. Maybe there’s some research behind it that says it’s a good idea. I’m not sure that you would see a massive divide in the type of tenants who can afford $330/wk and $280 and it seems that you can vet the applications. I guess it’s a question of the size of the pool? I think if the product was a bit bigger I would have more confidence in getting in and the nras side seems to be icing. The units appear to be moving, which should alleviate my concerns, and the pricing is the same btw regular agents and the nras agents. I believe it’s a good location as an investment…it’s no caboolture, bellbird park or inal a! Are you seeing much of this type of product coming onto the market?

    • todd September 10, 2013, 11:52 pm

      Hi Julian,

      Your comments raise quite a few issues that you may or may not have thought about. The first issue I would be worried about would be purchasing a property in Fairfield in Brisbane. As this sits on the outer bend of the Brisbane River, this suburb has great potential for flooding. Have you checked with the local council the flood maps and checked the flooding in 2011 in your immediate area? I understand you are buying a one bedroom unit in a unit complex but flooding can also damage carparks, building foundations, air conditioning machinery, communication rooms etc and would significantly devalue a property. If the location did flood, I would still be very wary as the next flood may hit 6 metres, as opposed to the 5 metres in 2011. The flooding is not a question of if, but when.

      The second issue you have is purchasing a one bedroom unit. By doing so you are limiting your potential tenants who would want to rent the property, down to singles or executives – and the same again when you sell the property. I think you have answered your own question in relation to the product, given you would have to have the dining/living on the balcony, raises many concerns. In relation to finance, banks and lenders don’t like taking on units less than 50sqm and have strong restrictions in doing so, and that is for a reason. That reason is your limited potential buyers. The banks have got years of data and research in relation to these types of units.

      Your next issue is purchasing brand new in Brisbane. With brand new properties there is a GST component in alot of the purchase price. That GST component comes in with materials, contract labours, machinery hire etc and it’s this GST you are paying for. This is why new properties often go down in value 7 years after they have been released. As this is in Brisbane, and Brisbane is noted as one of the next hot spot of Australia, by purchasing now, you have already missed the boat.

      My next concern is that you are only going to get 4.22% yield. On this alone, I would walk away. Not only do you have a yield of 4.22%, but you would also have strata of approximately $100 plus per week.

      The numbers just don’t add up!!!

      Now in relation to NRAS – You have obviously read my article on my blog and know my feelings towards NRAS. My concern in your situation is that 1/3 of the building is going to be leased to NRAS. In regards to your comment on someone who can afford $280, can also afford $330 per week, I could apprecaite that if it was a normal tenant leased through a normal property manager – but it’s not. These are leased to people who have to apply through the NRAS scheme. Now not all consortiums allow you to chose the tenant, but i believe some do, but by the sounds of it, you would be choosing the best of those who have gone to the effort of applying, and been approved. Reading previous comments, it’s not an easy task either. In my blog I have a similar circumstance where there was 40% of the units sold through NRAS and there were significant social issue problems that arose from that. Your building could quite possibly experience the same. Thinking outside the square a little further here, the issue may not be your NRAS tenants, but it could well be that other NRAS investors allow anybody in, of which you have no control.

      In answer to your last question, yes we are seeing lots of these high rise units with NRAS.

      I hope this helps.


  • Cindy Shannon August 26, 2013, 7:49 am

    Hi Todd,
    I’ve had great fun reading all of your comments 🙂 Thank you.

    Your information has been very helpful and the fact that you have taken the time to reply to all those people, when you really don’t have to, shows you have credibility and have done the research on this subject.

    I was considering renting one of these places but noticed that a great percentage of them were in bad areas and that the rent wasn’t really discounted as they claim. I did qualify for NRAS and received confirmation via email, but when I tried to find out more information from a Real Estate agent, about a particular place, I was spoken down to? What an assumption this charming(not)woman made! I would love to turn up at her office and have a ‘quiet’ word to her but unfortunately she’s in S.A and I’m not.

    I am renting on the Gold Coast (Not any Housing Comm etc), and have been in the same place for 17 years. I must be doing something right as my rent over that period has only gone up $130.

    I would like to move to S.A to be closer to my family but really don’t know where to start? My daughter lives in Whyalla (yes, I know 🙁 divorced, has child and now stuck there until he’s older), so there is not much she can do to help me find a place apart from telling me where a good safe suburb is.

    My reason for writing this is to say that there really is not much affordable housing out there for someone like me.

    Because I’ve worked hard all my life, my health (back) now isn’t the best. I still work 2 days a week, sometimes more if I have to fill in when someone’s away, but I know there will come a time as I get older (I’m 62)that I will have to cease work. Yes, I should have more money and be able to provide for myself, I totally understand that is the norm. I am divorced and was doing financially very well….thank you very much, but after the sale of one of my properties (15 years ago) I made a bad judgement on an investment scheme and was left with zilch, zero!! Taking the offenders to court only cost me more as they are very clever and know the law.

    My ideal situation would be to share rent with someone so we both could have a nicer place. But trusting that, that ‘someone’ would have the same values and respect for that property and each other would be difficult to find.

    Thank you for taking the time to read my story.

  • Hana August 13, 2013, 7:39 am

    Hi Todd,

    I am about to finalise a deal through the TIC group on a NRAS property at Zillmere, QLD. It’s a brand new dwelling, close to the train station and other amenities, already tenanted and showing positive cashflow.

    I am going ahead with this deal purely to get the tax deductions through the depreciation and NRAS benefits.

    TIC has not mentioned any other extra costs apart from Body Corporate, Sinking funds & Council rates on the property profile. Other costs I assumed as Stamp duty. Is there any other cost?

    Also, I am not sure how these NRAS benefits are paid. Are they paid as cash every year? What if I want it as a direct payment and not as a refundable tax offset?

    This is my first investment property ever and after reading so many negative comments on NRAS, I am bit confused whether to go ahead with it or not. I may lose $1000 dollars deposit if I break the deal at this point of time.


    • todd August 19, 2013, 2:07 am

      Hi Hana,

      My first thought is why would you buy a property purely for tax benefits?

      My second concern is that after Google searching NRAS Zillmere I found there were some townhouses for sale at the high $300’s. How much did you pay for the property?

      There are new townhouses for sale for high 200’s, so i question how much markup has been put onto these properties. I have been offered up to $60,000 per property to offer these types of properties to clients ( we obviously don’t ). Therefore it would take you 6 years of receiving the $10k back each year just to get back to even.

      A quick search on will confirm this for you.

      From what I understand, the benefits are paid annually in a lump sum.

      A $1,000 is a small price to pay… losing $60k plus could be unrecoverable for many years.

      Hope this helps – Todd

      • Brian August 19, 2013, 1:55 pm

        re Hana posting
        I cannot believe anyone would commit to something they have not thoroughly researched and understood beforehand. You should not be asking Todd questions, you should know more about NRAS than Todd if you have committed to purchasing an NRAS property.

  • Julia July 30, 2013, 12:37 pm

    Hi Todd
    I wish I could read this article earlier.
    I bought a NRAS property in the Ponds several months and now felt regret with more in-depth understanding of this scheme.
    It is really a bad investment not only because of the tenant, but the high administration and maintenance fee and lost control on your own house.
    Todd, do you know whether I can quit the scheme as it is not settled yet? I checked with the developer, their answer is I have to settle as a NRAS property firstly and then I can quit by paying some exit fee (that is around $750).


    • todd July 31, 2013, 2:08 am

      Hi Julia,

      To answer you honestly… I don’t know as I have never purchased an NRAS property. From some of the comments though, it looks as though many consortiums allow you to convert back to a home or normal investment property… having said that i don’t know of anyone who has ACTUALLY proceeded with this successfully.

      Are you locked in on the property purchase???

      Cheers Todd

  • Porkpie June 21, 2013, 11:00 am

    Hi Todd,

    You have made some very good points regards NRAS.

    In the research I have done it seems you still have the selection of tenants for an NRAS property all be it from a pool of those who qualify. Rents are adjusted to lease CPI annually and revalued every 4 and 7 years. I also believe you can use any property manager (in WA at least) to manage the property.

    Is the ‘scheme” any good? I guess it depends on where you buy and how much you pay. Any property purchase can be over-valued and a premium paid to selling agents – certainly not a problem purely associated with NRAS properties. But I do believe the right property in the right market could prove a sound investment.

    I think some investors could be drawn to cheaper properties allowing for a greater return of additional rental income + NRAS. People may be drawn to purchase properties for >$300K because on paper they return $100+ per week; in reality they have been suckered into buying in a cheap area with potentially many other similar properties. Investors could make the decision purely on cash in the pocket and not doing due diligence.

    The other alternative is to research the market you believe has good returns be it rental, growth or both. Then consider NRAS if they are available, will there be limited NRAS properties or will it become a “ghetto”. It maybe that NRAS properties might allow you to purchase in your desired area and to be CFP. More expensive properties will mean you are forced to discount a higher rent so the net gain from NRAS is less than on a cheap property, but at least to qualify tenants wil need to have a reliable decent income.

    Banks lending to 70% LVR means nothing to me, they perceive risk in anything new or not conforming to there yesteryear ideologies. They demand big deposits, risks underwritten by Mortgage Insurers and then just to make sure call for conservative valuations.

    I plan to keep investing. Research the market and choose a property; I wouldn’t blindly pursue NRAS but if it works and adds a few more dollars in the pocket maybe.

    • todd June 23, 2013, 11:09 pm

      Hi Barry,

      With every investor whom I know who own and NRAS property ( only 4 people ), none have had the annual CPI… so although it is there to be increased, for whatever reason it has not occurred. This could be the investors problem or the property manager not doing their job. The other issue with that is that rents are increasing faster then the rental CPI… especially in WA

      Yes any investor can pay overs on any property, especially if new. The issue is that investors are blinded by the $10k per annum rebate they receive… this blindness is being taken advantage of by many unmoral property companies selling these properties. Like any government “scheme”, they bring out the sharks… for example the insulation program, the school buildings grants, the solar power scheme… all of which had unmoral greedy companies taking advantage of the scheme and making a joke of it.

      Cheers Todd

  • Praneeta June 18, 2013, 7:06 am

    Hi Todd

    I stumbled across your blog while researching about NRAS. I am an average employee earning about 50k. I have about 20k saved up and wish to transfer to say an investment. I am a tenant myself and don’t even have my own home. I am happy renting but also would like to use them saved up money wisely. Term deposit is bringing in little return and I am not a risk taker to invest in shares. Are you able to advise how best i can put my saved money into good use for future benefits.

    • todd June 19, 2013, 2:48 am

      Hi Praneeta,

      Sorry for delay in responding, I have been overseas. Yeh hard to answer your question with the limited info I have but by investing rather than buying your own home, you can buy a property anywhere in the right location rather than buy in the location where you live. Although where you live may be great and you like to live there, investing in a property in that location may be a completely different matter.

      I hope this help…

      Cheers Todd

  • Sue June 6, 2013, 6:20 am

    Hey Todd, how u doin, I’m a single mum of 2 girls, a middle income earner, I work full time and also hav a casual job, I put my girls through private schools and dance classes, I was a tenant in an nras property for the last 12 months without incident I actually look after properties as if they are my own, I was recently given a notice to leave without grounds from my agent, this was a brand new property wen I moved in, I’ve had a couple of problems with the property since moving in the first being a leaking tap in the wall in the main toilet, the agent was notified in August last year an took until February this year to fix it the second was a major leak from the main shower that the gent was notified about in January this year and to this date has still not been fixed and yet I’m being evicted for no reason, go figure !! I’d b interested in your thoughts, thanku sue

    • todd June 6, 2013, 11:10 am

      Hi Sue,

      The hard part of your problem is knowing why they gave you notice. If it was due to the problems of a new property, then the vendor really should have no issues as they can go back to the developer or builder and have them fix under warranty. Sometimes though getting builders back under warranty can be a tough task. The time delay may be an issue with the vendor or the builder, hard to tell…

      Sorry but cant help a lot here as the vendor doesnt need to give a reason…

      Cheers Todd

      • John Smith June 10, 2013, 11:06 am

        hello, i was wondering what is better The NRAS or First home buyers grant in terms of: housing affordability, Government expenditure and equity

        • todd June 19, 2013, 2:41 am

          Hi John,

          Sorry for late reply here I was away overseas, back today. The First Home Owners Grant is a one off payment verse NRAS is paid annually over ten years. The issue with NRAS is paying overs for properties along with high concentration of NRAS properties together and the issues that arrive from that. The Blog has pointed this out along many comments.

          Hope this helps…


    • Greg July 12, 2013, 10:46 pm

      Wait let me get this straight, you can afford to put your two children through private schooling yet need assistance to live in a your brand new house. Lucky you. This is why schemes like this are an utter joke. In the meantime I’m working my ass off to own my own home and I have put my kids in public schooling.

      • todd July 24, 2013, 4:03 am

        Ha nice Greg…

  • Matt May 31, 2013, 4:03 am

    NRAS is not the antichrist. All things being equal between two properties the one with NRAS attached is a better investment.

    The problem is the dodgy side of the property industry (the spruikers and chain sellers) have latched onto this quicker than the rest and have polluted the waters with as you correctly identify over inflated priced properties which negate any benefit the NRAS provides by ripping the investor off on the purchase.

    Your points about the tenanat are valid but not a definitive argument as probelms will arise with tenants for any apathetic landlord who takes no interest in who is managing his property and where it is and who its going to, its just a little heightened as even if you do your DD you probably have less control at the end.

    The final points about locations, overvalue etc are the same for any property.

    I would summarise to say I wouldn’t go out with a shopping list that has ‘NRAS’ as a required item, but in the present market the best returns may just be with NRAS properties, if you can find one managed and sold by reputable parties, in the right location for yourself. The flipside is there’s not much I’d buy fullstop in any market in Australia that’s new as most are overpriced due to high production costs and are often of poor quality finish and construction

    • todd May 31, 2013, 4:20 am

      Hi Matt,

      I agree that NRAS isn’t the heart of the problem and it is those who rip investors off… but its those same companies that get properties approved for NRAS. The problem also lies in the dense NRAS communities. Unfortunately with NRAS, there is no – all things being equal…

      If NRAS could be approved to any property in any location, then I don’t think we would see the problems we are seeing.

      Yes any new property can have the same huge kick backs related to them… although they seem to be much higher that i have seen with NRAS as the annual return of $10k blinds many investors, thats all they see and so the firms increase their fees and take absolute full advantage of it.

      Personally I think that NRAS should be for existing properties not new… and limited to a ratio of 1 in 8 houses.

      I disagree with the best returns being NRAS as the word returns means more than is simply written down on the agreement. The problematic issues that arise along with non payment of rent, social issues and the sale price in the end all are part of the return.

      Yes new properties are not what they used to be… huge costs, GST included, poor workmanship and poor finishings.

      Cheers Todd

  • Nicole May 24, 2013, 11:58 am

    I agree that the properties are not really cheap and are in inconvenient areas. Any property should be able to be deemed NRAS if it meets health/safety criteria for a rental property in QLD.
    You must be unaware that the government does not actually “back” NRAS approved tenants. After verification of meeting criteria and recieving an approval number the prospective tenant has zero dealings with the govt. You are required to find the property through an agent and sign a standard RTA lease which has nothing on it regarding NRAS. You have the same rules and obligations as any other RTA lease. The RTA is NOT going to offer leniency or disregard Queensland Residentail Tenancy Authority Laws. They do not get to say “oh NRAS, I guess we will just ignore the fact you have been given a notice to leave form for unpaid rent”. The owner also chooses the tenant and has the same rights any other lessor does.
    I currently live in a NRAS unit in Caboolture. 40 units, 50% of the tenants would fit into your stereotype of low income or government reliant people. At least 2 suspected drug dealers, whole families of obese slobs who have never worked, young ‘ladies’ in tatty pyjamas all day with kids that probably should be at school but aren’t, hear at least one fight per night and I am pretty sure this one lady is a prostitute etc etc. The other half including myself do not. I have a degree and have always worked but due to a relationship breakup I along with my 2 young children have no choice but to live here for the term of one lease until finances and property settlements take place and I return to work from my maternity leave.
    I paid more income tax the last full financal year I worked than rent I will pay the year I am stuck living here and am kind of sickened being around here when I see the lazy young people that tax money supported. You must also be unaware that teachers, ambulance officers and certain government employees are also automatically eligible for NRAS. There are some here. Also the cut off approval income for a 2 parent family with 3 kids is more than enough to rent and live comfortably without NRAS. This scheme gives those families a rent break increasing their savings potential to purchase their first homes.

    So just because the absolute low of life are approved for NRAS does not mean an investor would ever have to have one of those types of people living in their property as they can approve tenants and applications have employment history and all references to check.

    Quite inaccurate article.

    • todd May 27, 2013, 1:14 am

      Hi Nicole,

      The Blog is about whether I would invest in an NRAS property, and obviously I wouldn’t…

      The reason that you have clearly pointed out is that the tenants can be an absolute nightmare. The end result being that property values decrease and some neighbourhoods become ghettos. This seems to be the case where you live. So although you state my article is quite inaccurate, in fact you have 100% confirmed as to why i wouldn’t invest in an NRAS property. It’s your exact wording above about how half the tenants are problems tenants. It only takes half of a block like that to make the area non desirable place to live and decrease property values. Now as an investor, we don’t invest to simply house tenants, it is to create wealth… and your overview of where you live affirms this notion.

      Having never been through the application stage of applying for a NRAS rental, I don’t know how the process works. I do know however, that property managers bid for NRAS development stock in bulk managements. In order to gains these managements, they must give referral fees, essentially halving to halve their management and leasing fees. Now reputable agencies will not go down this path. Reputable agencies build their rental book by not discounting and gaining quality hassle free tenants.

      We have a comment earlier in the piece from a property manager who agrees with this and would never take on a NRAS management. I have personally asked every property manager I have and they too would never take them on. Now I don’t use small agencies, I use the best agencies and some of them have rent rolls of over 1000 managements and they instantly discard NRAS.

      Your comment in saying that the owner chooses the tenant, in theory is correct and i definitely choose my tenants and discard any I don’t want in my properties. This, however, is not common practise, and many landlords leave the tenant choice up to the property manager.

      I also agree that not ALL NRAS tenants are bad news… it just seems to be the vast majority.


      • Jodie October 5, 2013, 10:44 am


        All I can say is wow! Upon the commencement of reading your article, I regrettably admit that I thought to myself – wow this guy sure does sound like an intelligent, well mannered and respectful bright person….I’ll keep reading as this sounds like a well written article.

        Boy was I mistaken. You may be intelligent when it comes to investment homes and making good property decisions Todd, but I think it is very sad that you seem to be filled with judgemental remaks made about those less fortunate and experiecing financial hardship in their lives! I mean, come on mate! Are you really that dense? I guess I can’t blame you for clearly having your head stuck up your own backside, living your easy greed driven life because you seem to know it all don’t you? Your obvious lack compassion and judgment filled opinions about the kinds of people in desperate need of help with a scheme such as this one makes me angry at the core! Yes Todd I think it’s fair to say that there are many people that abuse the systems (not just this one), and make no real efforts to help themselves – in which case your opinion is somewhat warranted, but to categorise everyone who is on a pension and struggling to make ends meet with the costs of living by painting them all in a less than human like light is disgraceful! Let me tell you a little but about my life and the reason I now seek to find some help with affording to pay my rent with this scheme. I have never not worked a hard damn day in my whole life, I have always paid my taxes and contribute to this society in which we live. But unfortunately for me Todd, I was bullied for months and months last year by a manager who had jealously issues, and she decided to discriminate against me in my place of work which eventually lead to my losing my job in a Management position….which then lead to me emotionally and physically breaking down. I have a legal battle on my hands at this point in time, am unemployed due to this monster, I have two kids to raise and put a roof over their heads and food in their tummies by myself as I am a single parent having to unfortunately rely on Centrelink Benefits which I absolutely detest having to do!

        Unfortunately, this bully at work has prevented me from obtaining employment in my field, as well as forcing me to endure some of the most horrific challenges of my life, which is now struggling to make ends meet as well as looking after myself and my children. I might also make mention of the fact that I am a single mother due to being a victim of domestic violence and I had no choice but to leave and take myself and my children out of danger.

        So I’d like to say that I really think you perhaps need to rethink your opinionated, self righteous attitude and perhaps rethink the way you view those who are less fortunate than you are who probably know more about surviving a hard days work than you do Todd. Im very disappointed that there are still people around that think the way you do Todd. Just because people need help it does not mean they all deserve to be treated and categorized as less than human beings. Have a think before you speak. And just remember, money and assets and material things do not make a person a good one.

        PS to those disgusting sarcastic comments made about the lady who pays for private education for her kids – that is the worst judgment I have read in a long time Todd! You read her comments – she
        works crazy hours to pay for that and she probably sacrifices other luxuries
        to be able to do that! Like me! I pay for my child’s education out of the very little money I have JUST so he can have a good education! I go without so much so that I can do that! I am also putting myself through college so I can better my life so yeah, $5.00 to me is like having $200.00 and every single cent is accounted for!

        It makes me sick that there are some successful people out there making their big dollars and owning their investment properties thinking they are above others…you do know that you can be wealthy AND have a kind compassionate soul don’t you? .let me tell you that being in unfortunate and terrible situations are literally out of your control! Nobody deserves to be in a desperate place in life and most of those people who are – are good people and would probably give you a bed to sleep in and a meal in your belly if you ever found yourself in that position Todd!

        Rant over.

        • todd October 6, 2013, 12:43 am

          Hi Jodie,

          Firstly thanks for the kind words…

          As I have done before, I ask you have you been to concentrated areas of NRAS properties? It’s funny but no one either has or they don’t respond, which only supports my argument.

          Now I understand that there are 1000’s of families who require support or have been the victim of circumstance. It appears this has been your story. I am sorry to hear that.

          It still doesn’t change the fact that there are a ton of social issues surrounding concentrated NRAS areas… please note the word concentrated.

          I do question the scheme and those who require this assistance. Let me explain, there are many inner city apartments where the usual rent would be $500 per week and with NRAS it should be $400… now if circumstance dictates that people are struggling to afford rent then why do they live in the city, why not move out to the suburbs where they could rent a house without NRAS support and pay $300 per week???

          The scheme also allows for incomes up to $105k per annum… do they really require assistance???

          Now at no point am I discriminating against those who require help… my Blog is about property, not about the less fortunate. Perhaps you stumbled across it by accident, perhaps not. But if you would like to come for a drive with me one day and see these neighbourhoods where houses are trashed and other peoples properties is deliberately mistreated and look at the mini ghetto’s, then let me know and I will be happy for you to come… you may see my side of the story then.


  • Stud May 19, 2013, 8:48 am

    Hi Todd,

    I am intending to buy my own first home in the developing area of The Ponds, NSW.
    It has 6 2 bedroom NRAS home facing the entrance and 2 NRAS with whom I share my side walls.

    My concern is that is buying an own home around NRAS is good idea? Does it depreciate the price in long term, because it is surrounded by NRAS homes?

    I am unable to find any inputs around this and since new here unware if this is correct choice for my first home investment.

    Can you share your inputs around the same, as we intend to sell this 5-6 years down the lane and move out, but want to ensure I will get a good investment return


    • Stud May 19, 2013, 8:49 am

      Correction: Its has six , 2-Bedroom NRAS home surrounding it.

    • todd May 20, 2013, 12:30 am

      Hi Stud (sorry that was the only name I could see you use),

      Thanks for the comment… this is another side of the argument we haven’t spoken about…

      Personally I wouldn’t be proceeding… If you were a few streets away, then this would be worth looking at but being directly next door I would not look at purchasing. The problem you have is that you don’t know who your neighbours are who they me in the future. Now sure this could be said for any neighbour but if you are trying to make money from this investment, then mitigating risk is of high value, and I don’t see this as low risk.

      If you read through some past comments, I take of a development that was in Campbelltown and where some of the units were sold normally and the remainder were sold as NRAS, they were sold cheap as developer needed to liquidate, along with the fact that the block of units have now turned feral.

      The other consideration is buying a new property, yes the property is nice, clean and would have little problems (hopefully)… but you are paying the GST on all contractors labor and GST on the the products used in building the property.

      This is one reason why that a large percentage of properties decrease in value from the initial purchaser to the second buyer.

      Hope this helps…


  • Jeff May 9, 2013, 5:53 am

    Hello Todd,

    You are partially incorrect on your point that banks and institutions won’t take the annual NRAS payment into consideration. I believe Firstmac will included the NRAS payment as part of your income. And by the way I have no association with Firstmac.

    • todd May 9, 2013, 11:54 pm

      Hi Jeff,

      Thanks for that… Given we don’t write Firstmac loans, I haven’t checked on them. We predominately write loans with the majors as they offer great investment portfolio loans… I know Kim who owns Firstmac is a avid supporter of NRAS so I would assume they would allow for the annual payment. In some way I agree with the banks who do not accept it for the purpose of sensibility. If a investor is close on servicing and only passes due to the annual payment, then they could well be in financial stress until that lump sum annual payment comes through…

      Cheers Todd

    • Brian May 16, 2013, 12:57 pm

      also Adelaide Bank

  • Jamie April 29, 2013, 11:24 am

    Don’t you think it would be nice if some investors were more considerate to those on ” low ” incomes? Just because we are on low incomes doesn’t make us bad tennants…the housing crisis we have had has really hurt so many families and singles who cannot afford rentals at all…these are not just drug addicts or alcoholics these are true families, single mums (who majority actually work part time …did you know that?) Genuine people who are desperate to afford to live!

    • todd April 29, 2013, 11:51 pm

      Hi Jamie,

      Yes there is affordable accommodation for tenants out there… much cheaper than NRAS. I have seen many NRAS properties that tenants pay up to $500 per week. This is not cheap accommodation. I know there are many properties for lease in outer suburbs of each capital city that can be rented for $200 – $300 per week. My BLOG doesn’t state that EVERY NRAS property is a problem, it says that concentrated areas of NRAS that I have seen are problem areas.
      Cheers Todd

  • Jamie April 29, 2013, 11:08 am

    Someone also wanted to know about Zillmere…this is one of the not so good areas I have to say. Its much like Inala used to be like (if you know what Inala used to be like) Its predominantly low income and a lot of people with issues I do believe sadly. Although…they all need to have a roof over their heads too 🙂

    • todd April 29, 2013, 11:54 pm

      Hi Jamie,

      The comment you have made is what I am trying to point out… why are low income areas commonly problem areas. Why is that? It doesnt have to be that way…


  • Jamie April 29, 2013, 11:03 am

    I am a single mother, I have been on a low income for some time…yes a pension. I have a great tenant history and I get knocked back because of the discrimination in regards to single mums/ pensioners. I honestly think the tenants rental history would be the best thing to go by and also more consideration to where they may be in life.

    I have my name down with NRAS and have been looking at properties for some time. Truthfully, I do think you are being charged too highly and the rents are hardly what I would call low. Especially considering the areas where they seem to be. Most of these areas are in areas that are not so good or they are no where near public transport and facilities.

    I don’t think it is right that they should all be brand new and high priced, and definitely not all lumped in one area (eg housing did that for years, it had negative affects) They should be positioned throughout cities and not on outskirts (reminds me of indigenous being put into communities,here and overseas) and everyone should remember why this scheme started…it was to help those who could not afford the rents and to deal with the rental crisis.

    So….my suggestion, is if you are only going into it as investment and not considering those who you are renting to, then maybe it isn’t the best idea.

    Not all low income pensioners are bad tenants. I know I have always left the place as it was if not cleaner when I have moved out. Very rarely any damage and if something comes up I have always made an issue of having it fixed and I also have cats, so have also always made sure the house has been fumigated for pests including fleas when I leave (pets really are not a big deal)…. so my suggestion is people put their hand up and say hey maybe we should be spreading these houses out a bit, giving these low income earners a chance to get ahead being able to afford houses within the city not on the outskirts and charge less for the house so the rents can literally be affordable for those who need it.

    PS…I am also a student hoping to improve my situation. You will find most on pensions are doing the same….. maybe its time more people thought about what it is like to do it tough.

    • todd April 29, 2013, 11:58 pm

      Hi Jamie,

      I completely agree with your comment on that it shouldn’t be new housing… if we really want to help low income earners with cheap accommodation, then why not offer second hand properties, scattered throughout the community and truly help those who need it.


  • Liza April 25, 2013, 10:38 pm

    I think NRAS is a great scheme, as an INVESTOR of 2 of them, I CAN clearly state you are wrong. Both of my investments are in great areas with huge growth potential. Sandringham and Southbank Melbourne. I also have another 5 other investment properties that are not with NRAS, that have cost me a lot of money to get them to positive gear.

    As for tenants problems, we have had less problems with the NRAS then with our other investment properties. And YES we do get a say in who leases it and they are not all pensioners and high risk people. We have had good tenants and no problem with it.

    So my suggestion is if you wait for a good property in a good growth area and make sure you negotiate the RIGHT price for it, they are FANTASTIC investment.

    I am not also not someone trying to sell them or have invested interest in them. I am mother in normal working family that has not wasted our money but instead invested wisely.

    Our philosophy is “it’s better to do something than complain and do nothing and wish you had of done something.”

    NRAS scheme is a good thing and if another good investment comes up i am sure we will re invest in it.

    • todd April 26, 2013, 3:12 am

      Hi Liza,

      Thanks for your comments… we really haven’t had too many NRAS investors comment. I am glad you are having a good experience with the scheme. My Blog doesn’t state that all NRAS are problems, it does say that I have seen many areas across Australia that have concentration of NRAS that are huge problem areas. And as an investor, I won’t touch them…

      In relation to your 5 other non NRAS properties… I don’t think you can compare them to your NRAS. There is obviously a reason your portfolio was not cash flow positive… maybe interest rates were higher then, maybe not correct properties purchased, may have needed renovation, could be wrong property manager ( sounds that way given the tenant issues you have had )… but when I invest it is purely numbers and my portfolio is cash flow positive, thats how I invest. If the numbers don’t stack up then I don’t buy… simple!

      I don’t know Sandringham well but I do know Southbank… and sorry I don’t agree with the area being a great investment area. I assume that it is a unit in a high rise block as there are no houses that I have seen there ( could be wrong ). If it is in a high rise block then the strata fees would be around $100+ per week… and with 20% below market rent, I would question whether it is actually cash flow positive.

      There are currently 347 units for sale today in Southbank alone and if you include the surrounding area in your search, then there are 2361 units for sale. There are 523 units for rent in Southbank alone and if you include the surrounding areas, there are 2803 units for rent. These figures do not include adverts that advertise multiple units on one add, so those numbers are much higher in reality…

      Southbank’s vacancy rate is 11.5%… have a read of the link below

      There are over 25000 units approved for development in Melbourne CBD over the next 5 years…

      My point being there is massive oversupply and capital growth will be non existent for many years to come. With that many rentals available, the rents will also decrease as desperate vendors drop their rents to get their property filled, which may also decrease the rent you receive… as the median rent for the area will also drop.

      Sorry for the scary numbers, but I disagree that Southbank is a good investment… and mixed with 20% below market rent along with massive strata fees, your holding costs would be quite considerable until the $10k per annum cheque comes in…

      Cheers Todd

  • Samantha April 17, 2013, 8:03 pm

    I am on disability pension.
    I always pay rent on time, and look after a rental property as if it is mine.
    Landlords are always happy to extend my lease. The only problem is they also increase the amount of rent I pay. It then becomes hard to buy food, medications, and pay rent. So i end up having to move somewhere else, a cheaper place. The same thing then happens at the cheaper place.

    The process of rent constantly going up means I have no life. I find it hard not knowing how long it will be before I have to move due to landlords raising rent.

    On several instances I have gone off my medication just to pay rent. Only to end up in hospital. Doctors and surgeons get annoyed at me for not taking my medication. A nurse said to me “a lot of people pay bills first, before anything else. You need to priortize your Heath first).”

    So I am currently homeless.
    I have been beaton up in my sleep by youths. At the same time I am thinking why do landlords have to be greedy.
    My previous landlord had invested in several properties. His property portfolio was not good. He was losing money. So he decided to raise the rent so high that I had to check to see if it was legal (what he was asking for is illegal). I was told rent can only be raised no more then 10% when renewing a contract. The landlord had 5 properties on my street. All the tenants moved out as soon as their lease was up.

    I now get extreme anxiety before going to sleep, I prefer to sleep during daytime on trams. Sometimes in front of a police station. Once in winter I asked a couple of policemen if they could arrest me for a few nights, on the basis that I have been loitering outside the police station. I asked because I was so cold, and the cold wind was painful.

    • todd April 18, 2013, 12:36 am

      Hi Samantha,

      I a sorry to hear your situation… the reason rents go up in value is due to living costs increasing as well interest rates also raise and fall. This means that vendors need to put their rent up to make ends meet. They are also investing to create a future for themselves.

      It’s great that you have access to the internet to be able to voice your concerns.


    • Anthony June 7, 2013, 9:20 am

      Hi Samantha,

      I currently rent out 2 properties on the Gold Coast that I purchased around 2002. When i initially purchased those properties, my annual land tax bill was around $1600 from memory. Today, my land tax bill on those same properties is about $5500. So i’m now liable for about $4000 more tax every year.

      Insurance costs have gone up massively. over the same period of time my insurance bills have increased by about $2000.

      Then take rates into consideration. Again, we’re looking at an increase of at least $1500.

      So if you total that up, just holding those properties costs me about $9000 more today than it did 10 years ago. If you then factor in the rent over that time has increased by about $100/week, you end up with me actually not getting anything from that increase.

      I am actually worse off today than i was 10 years ago. I’m just saying this to let you know that its not greedy landlords that increase the rent to make more profit. It’s usually taxes, insurance, rates and maintenance costs that increase over time.



      • todd June 19, 2013, 2:33 am

        Hi Anthony,

        Thanks for your comments… Wow your land tax has certainly hit your back pocket. My only thought here would be to have a good look at your rents as $100 increase over 10 years seems very low.



  • Rick April 17, 2013, 6:44 am


    I have to say that blogg appears very biased and negative in its slant towards NRAS. Are you trying to create posts to push your blogg up the google rankings?

    I believe the government agencies cap the amount of allocations in suburbs to stop this so called Gheto affect.

    In South Australia the eligible wage is just over $45,000, hardly a wage which is going to attract the welfare recipients of our society, of which not all are as bad as you appear to reflect.

    The NRAS incentive allows your property to positively gear, even at a 100% lend against the property in the South Australian market will earn you up to $8,000 a year. Depending on the suburb or market conditions that will ultimately reflect growth, but a private developer to a large builder they are all going to have margins. So unless your a private builder with your own trades margins are going to be made. If the margins are ridiculous they will be found out on valuation via the bank, which allow a potential purchaser to decided then if they wish to continue.

    With NRAS also being quite popular and increasing in demand I find this will increase the price of these properties as more people want to purchase them so the early investors into this scheme could maximise their returns.

    Overall any investment made on sound and research judgements is worth considering. NRAS has a far superior income return rate to an old house or new house or DEFENSE housing. The days of demolish, build and sell making 100k are currently gone. The days of a diversified portfolio, which the benefit of growth in time however are not!

    • todd April 18, 2013, 12:45 am

      Hi Rick,

      It appears you too also own or work for an NRAS company as your URL states this…

      You mention that those who got in early into the NRAS scheme would make money… as your website states that it is under construction, i assume you have just jumped onto the bandwagon and therefore are not new to the scheme.

      You mention that you believe that government agencies cap these these allocations. Is this an assumption or you know so???… as i know many NRAS properties are offered to fast selling salesman who see developers struggling and get remaining stock approved as NRAS. Thats fact, not here say…

      Unfortunately with the property investor sharks out there, they pray on those with large equity in their homes and the banks don’t care if the valuation comes in low or not as long as they are under 80% leverage… as you would know being in the game. Cross collaterisaing of properties allows for this.

      I do agree on the demolish comment… but not the rest. I assume you live in Adelaide but havent physically seen any other locations across Australia, which I have… and yes in Elizabeth you have issues there too… please dont pretend otherwise.



  • Ben April 2, 2013, 10:30 pm

    Cara- its just business. Professional property investors are not running charities, you have a vested interest in NRAS as you live in one. Step back from your own situation, would your run a business at a 20% loss every week? is that a sustainable business practise??

  • Cara March 30, 2013, 1:33 pm

    You’re a dork. You think a non NRAS property is a guarantee of good tenants? If you choose a bad agent you’re likely to get bad tenants! Just because it’s NRAS does not mean welfare tenants and tenants on welfare does not equal bad tenants! I live in an NRAS unit, I work full time and the very first expense that comes from my wage is RENT and it’s 2 wks extra in front as a buffer in case of unforeseen circumstances. My neighbours all work. We have inspections every 3 mths without fail (I receive an excellent rating) and our rent is raised every year. All tenant applications are approved by the owners not the agent. Worst of all I’m a dreaded SINGLE MUM! When I eventually vacate the property I expect to leave it in as new condition. I’ve not placed a single nail in a wall and have taken great care to ensure the furniture does not touch the walls to damage them. The oven even remains in as new condition after three years. After having to fix up some real dumps over the years because the landlords won’t fix things, it’s a blessing to live in an NRAS property and I care for it as if I were my own.

    NRAS tenants are workers not welfare.

    • todd April 2, 2013, 3:46 am

      Hi Cara,

      So thank you for the kind words… I think you have completely missed the entire point of my Blog. I also think you are looking at this with bias eyes as you live in an NRAS property and yes you are one of the good ones… but i travel extensively and I see these communities and they are nothing short of horrible and at times dangerous. Maybe you should look further than your own unit to see these places.

      Now not being NRAS doesn’t guarantee good tenants… but my well researched property manager does after i give the OK for that tenant to live in MY property. Unfortunately for NRAS nearly everyone doesn’t get to choose their property manager… and yes some are useless.

      The BLOG was about whether I would buy an NRAS property and the answer is no I wouldn’t… even your comment about the rent going up each year is no good to me, my rents go up every 6 months and given you are paying 20% below market rent, this does not make for a profitable investment property.

      Having a job doesn’t mean that the tenants are good tenants either… I am glad you keep your property clean and live in one of the few good NRAS locations


      • Brian April 6, 2013, 9:02 am


        You say:

        ” I see these communities and they are nothing short of horrible and at times dangerous.”

        You are really exaggerating and generalising here. Given these are brand new, along with other new properties, occupied by employed tenants, do you really expect us to believe you when you say things like this ? It smacks of fear mongering rather than a fair and unbiased comment.

        Give us a few examples of locations where there are NRAS properties in “dangerous” areas, and areas which are “horrible”. (as you would know many “lower socio-economic areas” have been the best performers in terms of growth and yield over the last few years – the likes of Nathan Birch, and Margaert Lomas have oftentimes recommended properties in some of these areas (Blacktown areas like Tregear, St Mary’s etc, Elizabeth and Hackney West in SA). And you yourself have recommended Armadale in WA which is considered a lower socio-economic area which some people might describe as dangerous….).

        Are Kearneys Springs, Zillmere, Fairfield, Mount Louisa, Sunshine Coast, Coburg, Adelaide CBD, Mount Barker, Beechboro what you describe as horrible and dangerous (all these have quite a few NRAS properties….).

        You views are welcome, but please be balanced, and leave fear mongering and exaggeration for the property spruikers

        • todd April 8, 2013, 12:49 am

          Hi Brian,

          It would seem that you must not have visited these locations… I have visited many and yes these neighbourhoods are dangerous…

          NRAS does not mean employed tenants, its offered to lower income earners… not all lower income earners actually work. And not all workers are good people…

          Just because these locations have been recommended by others does not mean that they are going to be great locations… eg
          Blacktown – averaged 4% last ten years… last 12 months 2%
          Tregear – same as above
          Elizabeth – decreased 15% in last 12 months
          Hackney West – decreased 3% in last 12 months

          I hope this highlights that just because other people have recommended an area, does not mean it has or will perform well…

          Now yes I do buy on the lower end of the market but only in the nicer parts of each suburb.

          I think what you have done is categorise the suburb with the NRAS developments there… my Blog highlights concentrated NRAS neighbourhoods having problems with social issues and how I wouldn’t invest in them. At no stage does it say that some of the suburbs that have these NRAS properties will or won’t perform. Now yes some of these suburbs will perform well, but that has no relevance in whether the NRAS properties in these locations will perform well… Your examples of numerous locations may well have NRAS and yes the suburbs may perform well, but again that doesn’t mean that the NRAS properties within those suburbs will perform well… I buy in suburbs that have NRAS in them and yes the suburbs will perform well, but I know that the concentrated NRAS neighbourhoods there will not.

          Now to use your chosen experts: Margaret Lomas and Nathan Birch… both of them plus myself are professional investors. None of us recommend developments and none of us ( to the best of my knowledge ) own NRAS properties… I think that says a lot. And correct me if I am wrong, but I don’t know of one professional investor who owns more than 20 properties who has NRAS in their portfolio??? Why is that? Nor do I know of anyone who owns more than 10 NRAS properties???

          I am happy to answer the location question:
          Campbelltown NSW – large block of units were being sold by private treaty, 25% were sold this way. Then remainder 75% sold as NRAS without previous purchasers consent (not that they needed it) and sold at cheaper price. This block has now known as a no go zone… police visit the block regularly and previous 25% of owners cannot sell their properties and get out.
          Bellbird Park QLD – neighbourhood of 3 streets – major social issues. I wont drive my car around there and certainly wouldn’t visit at night… oh Yeh 100% NRAS properties. No local property managers will manage the NRAS portfolio due to social issues.
          Bendigo Vic – same as above

          I hope this answers your questions Brian… and yes I can keep going location wise…

          So with your suburb examples:
          Kearney Springs – I wouldn’t buy there as it had major floods in 2011… actually rapids down the through the streets
          Zillmere – dont know enough about the location to comment
          Mount Louisa – already has some problems on the western side of Townsville – and still recovering from the Storm Financial devastation
          Sunshine Coast – way too big and area to categorise as one location – more like 20 markets within.
          Coburg – Having lived in Brunswick for a few weeks when I travelled Australia, they had problems there well before NRAS. Having said that the suburbs are going through a gentrification process and becoming more attractive
          Adelaide CBD – way too big to categorise as one market – I also haven’t seen any concentration of NRAS located there
          Mount Barker – I do hope you are kidding here, yes nice dainty town but has had problems for a long while
          Beechboro – I know the area, but not enough to comment on whether the NRAS is an issue nor whether they NRAS is concentrated. I know Midlands has some bad areas and Malaga just 5 mins down the road is an area I researched but walked away from due to the problems it has

          Now the social issues that I have witnessed through NRAS don’t come from an NRAS property here or there, it comes from concentrated NRAS locations. A big difference here…

          Please don’t confuse or mix NRAS properties in with how a suburb will perform… chalk and cheese, hence we use a median as a scale which filters the lower end and top end of all sales in each suburb. But poor NRAS sales will keep a Median down lower than its actual, similar to land sales.


          • Brian April 9, 2013, 12:30 pm

            Well, this is the first time I think you mention that your main issue is where there is a concentration of NRAS properties. And I actually completely agree that this is an issue – big risk. as is some of the actual properties – some of them are really small, and not investment grade….

            I’m pretty sure I said (in earlier post), and others that NRAS of itself does not make a good investment – the fundamentals of the area is of prime importance. NRAS opportunity could be icing on cake if available subject to due diligence.

            Looked up bellbird Park on interweb, and cannot see anything on web that would indicate it was dangerous – no more so than the general Ipswich, redbank Plains area…

            You mention poor performance of some of the areas I mentioned – fair enough. But Armadale where you have recommended until recently show equally poor performance (last 12 mths, -0.4%, last 3 years -0.7% per year.) Past performance rarely indicates how well an area will perform in future. You know better than to use historical growth rates to indicate an area is not good for future growth.

            If NRAS is so bad, I do not understand why, in the whole of Australia, there are so few established NRAS properties on the market for sale (noting we have already established that you can get out of NRAS at any time (contrary to one of your earlier claims…)).
            Also in most cases you the owner has the say in who the tenant is…. so if you only want employed tenants, that is a criteria you use with the property manager.

            Now you probably think I am all for investing in NRAS, or I may have an interest in them.
            Neither is the case.

            What I am after is a balanced, non-emotive discussion of the pros and cons, things to be wary of, risks, benefits. Things that I have not seen much of in your posts which have included some mis-statements and a large number of emotive remarks.

            In summary NRAS of itself is not a reason to invest in NRAS. But NRAS of itself is not a reason to not invest in an NRAS property.

          • todd April 18, 2013, 1:13 am

            Hi Brian,

            My Blog states about the concentration of them… along with the sharks who rip clients off when selling them.

            So you looked up Bellbird park… so in other words you have not been there… pay the $100 for a flight and go there… they are good size, not small as you mention, 4 bed 2 bath double garage properties that the suburb would normally offer… no medium density or cramped living. The properties are very much so investment grade… I invite you to visit the area and go see for yourself.

            We had a property manager comment earlier in the piece named Peter… he wont touch them , nor will my property manager… now i don’t just go with anyone with property management… I research to the hill on this matter and she hates them and wouldn’t touch them even if she was paid 20% commissions. That says a lot. and thats a fact!!!

            You mention Armadale… but Aramdale is a Shire and a Suburb… have a look at the recent stats and some suburbs are now performing fantastic… I do agree past performance have no bearing on future… hence i use population growth stats and poor property market, thats why I invested there. But this has no way any bearings on how the NRAS properties there will perform. Sure they will benefit a but from the general market but wont see any where near the full extent of the growth.

            Now I can clearly state why there are so little NRAS properties for sale – as they are worth less than what the purchasers paid for them and they cannot afford to sell them… SIMPLE!!!

            The investors who are thinking of selling are hoping that they will go up in value to the point where they can sell and break even… I speak to probably 20 new investors a week and of them about 5 own NRAS and that’s the general consensus… sorry…

            You don’t have control in many cases who the property manager is… and sorry but employed is no criteria I find or any credit to be renting my properties… it takes a lot more than simply being employed. If thats what you use, then you are doomed for failure.

            I love you passion with investing, but my Blog is about emotions… I write them and its about my investing and what I think is a good investment and NRAS fails to meet the criteria..

            I ask the question – please name someone who owns more than 10 of this type if investment… now there may well be someone who does, but I haven’t heard of any… I think that speaks volumes…and it funny but no-one has been able to answer that question for me!!!

            Cheers Todd

  • Ben March 29, 2013, 3:32 am

    I am going with Todd on this one, NRAS smells like Negative gearing repackaged and remarketed.

  • Brian March 21, 2013, 9:02 am

    Todd and others
    There is a lot of mis-information in many of these postings. I have been doing some due diligence on NRAS and feel I know a bit about the scheme, its positives and its negatives. I have not yet invested, but am seriously considering it (but with a very specific approach). I am hoping this posting will present a fair and balanced view.

    1) NRAS incentive increases with Rental CPI (averaged over all capital cities)
    2) Actual rent is at least 20% less than the general market rent in the property’s actual location (QAHC it is 25.01% less market rent)
    3) Housing commission posts are irrelevant as NRAS is not housing commission
    4) You can opt out of NRAS at any time. There is usually a fee (eg about $900 in QAHC) and 6 month notice period. You (the investor) do NOT need to offer a second property to NRAS when you opt out. The FACSIA document Todd sent us to merely states:

    “Investors no longer wanting to participate in the Scheme CAN (my emphasis) sell their dwelling or cease their participation prior to completion of the 10 year NRAS term without incurring any early exit penalties:

    a dwelling CAN (my emphasis) be sold to another investor who undertakes to comply with NRAS obligations
    an equivalent dwelling CAN (my emphasis) be offered as a substitute dwelling for the remaining part of the 10-year period”

    CAN = no obligation. I have had this confirmed by FACSIA.

    5) Like any off-the-plan, house and land package, buyers need to be VERY careful. I do not think it is just NRAS but a general fact that people who buy brand new, pay developers profit premium, and maybe also marketers commission, and find the value is less in 12 mths than what they paid. Also if you buy a new property in an area of new property development, you often find that your house’s value goes down, because there are brand new properties being put on the market near by – would you prefer a brand new or second hand?

    6) Like many well intention Govt schemes (eg insulation comes to mind), sharks are attracted, and business people who see an opportunity to make money. So like any property investment, you need to verify the price is really market value.

    6) I believe under NRAS smaller developments (less than 50 I believe) can be fully NRAS. Personally I would steer clear of these, not for the concentration of NRAS tenants per se (having them all rental properties, NRAS or not, to me is an issue), but if they are all NRAS, then all of them will be seeking new tenants all at the same time and/or be put on the market all at once (at end of teh 10 year period). Similarly if there is a high concentration of NRAS in an area that finish at similar times, that would be a similar risk.

    7) Tax issues – investors need to be aware that there is an ATO Private Ruling that seems to indicate that you can only claim a portion of your expenses (interest, property mgt etc) as deductible. The % is the Cth NRAS Incentive amount as a % of the total incentive i.e about 84%.

    8) Property Management – there are various ways NRAS properties are managed. Many use local real estate agents (eg in Townsville for QAHC are managed by First National – but at 11% of market rental value (incl GST))

    9) Financing – many banks/financial institutions are now lending for NRAS properties at 80% LVR, and higher (with LMI), but 70% LVR seems to be the norm => this indicates to us all that they perceive there is some risk involved but with higher LVRs now being offered, that they are getting more comfortable with it

    10) Annual Compliance audit – the NRAS body you deal with must obtain certifications of compliance with NRAS. They will charge you anywhere between $600 and $1200 (QAHC is about $18 per week)

    11) unless you do a PAYG variation, you will be more out of pocket until you receive the Tax Offset (via tax return) and the State amount (Qld pays in Sept).

    My advice…. find an area of good growth, verify market value and types of ownership in the immediate area (rentals vs home owners). If there is an NRAS opportunity, then look into it but with eyes wide open.

    NRAS concept of itself is not bad. But as I said, there are sharks out there ready to take your hard earned. And there are additional fees here and there, and property management fees can be higher (to cover additional NRAS compliance issues).

    My figures indicate, that despite all the fees, and the apportionment of deductibility of expenses, using 105% borrowing (using other equity), you still come out CF +ve. And if you also choose well in the property itself, you come out well ahead.

    In all things, caveat emptor !!!!

    • todd March 21, 2013, 11:03 pm

      Hi Aussie,

      Its not that there is mis interpretation in the comments, its that there are so many consortiums involved in NRAS that all offer different things and have different rulings.

      The other scary thing is that unless you as the investor spend hundreds of hours researching then you are prey… you seem to have done extensive homework on one consortium.

      To add to a few comments you have made, yes there are sharks in House and Land packages, be that in NRAS or not… the dangling carrot that investors miss and that the marketers have over them is the cash rebates they receive per annum. Investors are blinded by $10k per annum and so the sharks lie waiting more in this area than elsewhere…

      Now you mention market value… this can be altered too as if there are multiple sales that have already occurred at a certain level due to this marketeering, then investors may find it difficult to know true value… I can see through this but can the every day investor???

      Property management, when they go to market and offer the management services to a local agent, management fees are shared and from all the property managers I have spoken to about this, they wont touch it… too many social issues. We have comment from a property manager in this Blog who agrees… all my property managers certainly won’t…

      Yes banks are lending… they don’t take into consideration the $10k per annum as income as it is paid annually. This is similar to those who receive Family Allowance A&B and receive it annually… so servicing for further investing is tougher as not only do you receive 80% or market rent you cant use the $10k as income for future loans. For the banks its a good deal as they know that you actually do receive this payment, so its a safety net for them…

      I yet to see any of my clients who own an NRAS property actually receive the annual Rental increase… in some have owned for several years.

      So on paper NRAS looks good, but in reality I have seen no evidence of this… if I thought otherwise, I would own multiple NRAS properties



    • Trisha Fitzsimmons September 16, 2014, 9:03 pm

      The onus for ‘due diligence’ in on Real Estate Agents, Conveyancers etc. See the following from NSW Fair Trading, especially the last two paragraphs.,_misleading_or_deceptive_statements

      False, misleading or deceptive statements

      A statement is taken to be false or misleading if it has a reasonable tendency to lead to a belief in the existence of a state of affairs that does not in fact exist, whether or not the statement indicates that the state of affairs does exist.

      Misleading or deceptive conduct is a concept that has been broadly interpreted judicially. Conduct is misleading or deceptive if it is likely to lead a reasonable or ordinary member of the class of persons to whom it is directed into error. Misleading conduct can include acts of silence or omission. Conduct can be misleading even if the agent does not actually make any representations. It is not relevant whether the agent actually intended to mislead anyone to establish liability. What is relevant is the overall impression created by the conduct and its actual or likely effect on reasonable or ordinary members of the target audience (prospective buyers). Any type of conduct related to the photographic advertising of real estate that could give a consumer the wrong impression may potentially breach the Property, Stock and Business Agents Act 2002 and the Fair Trading Act 1987.

      Agents must ensure that any claims made about any property or land characteristics in any photographic representations and advertising are accurate and could not give prospective buyers the wrong impression. Statements made in conjunction with photographs of the views and facilities available in a local area must not be false or misleading.

      All efforts should be made by agents and their employees to provide an accurate picture or impression in the consumer’s mind of the features of the property being offered for sale.

      Agents cannot avoid liability simply by claiming that the buyer or consumer should have made reasonable enquiries and checked the information provided. Agents are responsible for their words and actions in their dealings with their clients.

  • Juliette March 14, 2013, 11:16 pm

    I’m hoping to soon rent an NRAS house, I’m a single mother of one ASD child and have given up a professional career to meet my son’s needs. I now work from home in a new business that I am growing. I tend to live in the same residence for around 6-7 years so I believe I am a good tenant.


    I have previously been a landlord myself so I can see both sides of the story.

    I think it is a great scheme for middle to low income families who are trying to get ahead and save for their own properties.

    The problems are however these houses shouldn’t be concentrated in the same streets and the inflation of the house prices is outrages. I would invest in these (if I could) if they weren’t overpriced and concentrated.

    Back to my situation, I am keen to move into a bigger newer home to grow my business and save for my son’s therapies, but i’m not looking forward to sharing the street with other NRAS people, history has proven that this isn’t a good thing. Here’s to hoping there is more of a mix of housing in the street.

    • todd March 14, 2013, 11:39 pm

      Hi Juliette,

      Thanks for your great comment… Having been on both sides gives you a great perspective of the benefits and problems that NRAS communities create. And I must agree, in every location I have seen NRAS, there are issues… I am yet to see otherwise.


  • Les March 4, 2013, 12:02 am

    i am living in a block of 9 units. our landlord is a community housing group, a so called “not for profit” organization. i asked them if the units were NRAS built , they said no but we have the proof that they are .we have had nothing but problems from the time we all moved in (dec 2010).the driveway width is illegal been verified by the city inspectors.
    we can not park an average size car in the garages (i had to sell mine) and small cars have a lot of difficulty . their method of rent calculating is a sham. they take 25% of our pensions then they automatically add on the top rate of rent assistance. so now we have no rent assistance and if it is increased it forces our rents up . they recently changed from calculating fortnightly to weekly as they could see an extra $39,000 per year by rounding up 50 cents to the nearest dollar.they have over 1500 tenants. we believe they are a front for a company with share holders (we have heaps of documents) proving all of this. it is very odd as we have had meetings with polys and they seem to want to turn a blind eye.on the 12th march 2013 we are preparing a breach for a court hearing. they have made our life hell,intimidating us lieing to us ignoring us . we smell one big rat here and will not give up to exposing these and other issues

    • todd March 4, 2013, 12:05 am

      Hi Les,

      Sounds like a terrible place to live… I hope all goes well on March 12th…

      Cheers Todd

      • Jamie April 29, 2013, 11:17 am

        Hi Les….that doesn’t sound like NRAS at all…did you actually fill out forms and get an NRAS number that you had to present when you applied for the property???

        Sound to me that its “Community Housing” which is completely different and you get those houses through Housing Commission or through local housing groups that specialise in housing low income earners.

        Hope that helps.

  • Luke February 27, 2013, 9:26 pm

    I see you’re point, But I currently live in an NRAS property but I feel I fall within the % that this scheme benefits, I work 6 days a week and I am a single person I don’t even make half the wage most people down (under $30k a year) and in all honesty this scheme has really helped me get on my feet. Its easy for people to criticize when they have the money.

    • todd February 27, 2013, 11:08 pm

      Hi Luke,

      Thanks for your input… the story was more directed towards how concentrated NRAS areas can become rough unpleasant places to live and invest. The fact that you live in a NRAS property and it allows you to to live in a more affordable property is great…

      I am not criticising those who don’t have a lot of money… the problem I have is that the NRAS areas I have seen have turned into rough areas that I would not invest in… this is because the wrong people are in them…


  • Alan February 19, 2013, 9:12 am

    Hi Todd, I am about to purchase an NRAS approved property but I do not intend go with the scheme. Instead, I plan to get the first home buyer grant, live in it for at least 6 months, and then rent it out work towards paying it off. Now I have just heard word from the real estate agent that I HAVE to rent it out in accordance to the scheme (I am in NSW). Honestly, I don’t think he knows what he is talking about as my understanding is that this is a ‘scheme’ to get investors on the boat to help the government deal with socio-economic issues and this does not apply to non-investors. Am I correct?

    • todd February 21, 2013, 12:18 am

      Hi Alan,
      I am not sure I can help on this one… from my understanding all the consortiums have different regulations as what you can and can’t do… you will need to read all your paperwork thoroughly. Can I ask why you then purchased an NRAS approved house if you do not intend to use the scheme? Yes the government has invented this scheme to make available affordable renting to lower socio tenants… but apparently NRAS allows for up to $108k combined earners… I’m sorry but I don’t buy that, sure they may allow it but i reality I would love to see how many families that earn around $108k actually get approved. Be great to see the spread of incomes… that may quieten some of these sellers and supporters.

      The problem the investors don’t realise is that by buying an NRAS property, they are making it more difficult to continue to keep borrowing as lenders only take 80% of the already reduced rent at 80% of market… lenders don’t take into consideration the $10k you receive back each year… this reduces your borrowing ability

      Cheers Todd

  • todd February 17, 2013, 2:25 am

    Hi Thomas,

    It would appear that South east QLD is not the only place where this pumping up of prices occur as you pointed out several times… having traveled extensively in the last few weeks, it would appear Victoria and WA also have much the same unprofessional selling of property occurring… You can buy an NRAS townhouse for around $300,000 or you can buy a new house and land package for $30,000 less… I know which I would prefer???

    Jan Somers has a great forum on the topic where much is revealed as well… seems like this is Hot topic amongst investors… where many have commented on valuation shortfalls as much as $70,000…

    Mmmmmm $70,000 takes 7 years of $10,000 per annum rebate just to get back to evens… and the program only runs for 10 years, don’t look enticing to me!!!


  • Rebecca January 5, 2013, 7:45 am

    NRAS isn’t social housing. Both my husband and I work 60 k plus jobs and we have a family, triplets in fact and a older son. We’re in our 30’s now. I was quite disappointed to read your stereotype of NRAS families. We can afford higher rental prices. However, I think the major point of the ‘scheme’ was to allow a rental break so working middle class families could also save for their own house deposit and we treat it as such. I like Burpangary, I think it’s a great neighbourhood. I understand as investors this scheme may not be viable but you may like to rethink the stereotype. I would like to think at 30 we are getting ahead in life and progressing well into our careers, you know these things don’t happen over night right? I also like the fact that thanks to NRAS we are able to save an ‘extra’ 4k a year, yay go us!

    Warm regards,


    • todd January 6, 2013, 11:23 pm

      Hi Rebecca,

      I agree NRAS isn’t social housing but I have seen many built up areas of NRAS across Australia and the neighbourhoods offer the same attributes. The “scheme” wasn’t designed for families to save for a deposit rather than allow families that cannot afford market rent, to be able to rent properties. The fact that you are saving for a deposit and using NRAS to get ahead is credit to you and your husband. Seeing many of these locations, I can assure you that the vast majority are not doing this.

      Congrats on the savings… maybe there is a positive from NRAS

      Cheers Todd

  • s December 30, 2012, 3:13 am

    I have just been approved for a NRAS property in melbourne. Currently I am renting a tiny flat for around the same price. The NRAS property is nice, new and two bedroom, the only issue is that the area isn’t that nice and public transport is lacking. I was also pressured to sign as soon as possible and was dissapointed after to find that the agent has been lowering the rent on the other properties (probably because they can’t find anyone). I think NRAS is a good deal for renters but is limiting, for example the property we are leasing is a townhouse with lots of stairs and no garden, so really seems aimed at a working couple but then the income bracket is limiting.

    • todd January 3, 2013, 12:01 am

      Hi Sylvia,

      Great to hear the argument from the tenants side of things… was it difficult to get approved as a tenant?

  • Donna November 27, 2012, 10:02 am

    For those that feel that NRAS is for the lower income holders you would be wrong. It is aimed at the middle classes. It is not to help those that are on low incomes. It clearly states in the fine print that the property rent must NOT exceed 30% of your income. So those on any sort of income support are ineligible unless the have outsode income to supplement it.

    So many concerns that single mums etc may easily get preference is totally the opposite. I have just relocated my family in the hopes of being able to secure full-time work to get off Centrelink but am only able to find rentals at $300+ because i am currently not eligible to rent a property at $250 through NRAS because I don’t have enough income…

    My only hope is that I can secure & sustain a private rental till i can gain employment.

    • todd November 29, 2012, 10:58 pm

      Hi Donna,

      Thanks for your comment… it is nice to hear from the tenant side of the argument. NRAS is aimed at low to middle income earners, hence the name National Rental Affordability Scheme… Unfortunately it seems, as you have tried, that Centrelink applicants don’t qualify unless they earn extra income elsewhere.

      Once you find work, your income should be suitable to find a suitable property… the question being that, do you want to live in an NRAS community for a reduced rent or pay the normal amount of rent and live in your chosen neighbourhood?

      Good luck in finding employment…


  • kate November 6, 2012, 3:03 am

    The rent increases the same as everyone else’s rent Todd – which is the point – and very different to how you presented it.

    Next door to my home is a non NRAS property which sold for the same amount as mine so your comment of my property not increasing due to NRAS does not make sense.

    It is actually a really well priced property and I am guessing you do not understand bank valuations which are conservative and my property came in on valuation. The bank valuers value lower with NRAS so again argues against what you are saying.

    As far as these large commissions – that is also not correct and not possible for my property – as no room in the pricing. I have built homes before so know this….I also expect someone to get paid for marketing just as any RE agent. I have no problem with that as I get paid for what I do too.

    and for the person who listed all the NRAS consortiums – who do you think gets paid the commission here? – the developer of course. the price is not different if you go direct to them – you are just cutting out an external marketer for an internal sales person. The consortium does not build the properties either.

    I know people in the industry who have been offered large commissions to sell all sorts of properties and they have refused – so your generalisations are just that….I also know those people would never rip off anyone and it is not good to put everyone in one basket. You are saying this information without proof of these $50,000 commissions.

    I think the best comments on this page are the one from the mortgage broker.

    As far as my other properties you do not know how long I have held them – the captial already gained on them etc…(so many things you do not consider) You cannot ignore we have been through some tough times and just because a property dropped rent does not mean anything about the actual choice of the property originally.

    Some of the more prestigious suburbs are the ones that have had to lower rents over the last few years – but lots of money has been made in these areas too – with more to come I am sure.

    NRAS expert you are not as you keep making errors which you correct – which overall makes your initial comments largely incorrect.

    All buyers do your due diligence on any property is sound advice.

    • todd November 9, 2012, 4:41 am

      Hi Kate,

      On a weekly basis I receive packages and emails form marketing companies, property companies, developers and just straight out property sharks… these packages offer the huge commissions that I apparently are making up or generalising on. As you are not in the industry, you are not privy to these, but it happens every day.

      Perhaps your property did not have these huge commissions which is good for you… now given I own a large mortgage business and have been a mortgage broker for ten years, I do know what happens with valuations and to be honest bank valuations never come in low for myself as I buy under market value. Valuers must have proof to justify their value and risk rating ( valuations are not all about the $$$ )… and if you are well prepared then your real estate will hand the valuer a lust of comparable sales to make the valuers job easy. So I disagree in your comment… this is just what many say to happen but does not and as well the belief of many vendors that their properties are worth more than they actually are. If the value comes in low, thats because the comparable sales show this… not rocket science!

      Being in the industry kate, there are hundreds of companies that do sell their sole to the devil and accept these commissions… we have many new clients that have been ripped off by this in the past, so I think you are speaking out of school here… it happens… hit Google and search for yourself… why not look up Melbourne units and see how you can get a free holiday or car if you buy a unit… why do you think real estate laws continue to keep being amended, its to keep up with the new scams being invented.

      In relation to your other properties, I do not need to know how long you have had them nor their price point. My comment is purely based on supply and demand and if your properties had to be downward adjusted by $10 per week is a strong sign of a not so strong population growth. This growth also drives capital growth… if there are minimal buyers then there is minimal chance of making much capital growth on property ( unless it is a very unique property in a unique location )… and if they were prestigious suburbs as you say then i am sure the rent would have dropped by more than $10 and that you wouldn’t have had many students in there as tenants and now a 5 person family that doesn’t work.

      Yes we have had a tough four years but let me give you a snap shot of my rents – Macarthur NSW rents have increased over $100 per week in past four years on properties I purchased for $270,000. Geelong rents have increased $60 per week plus in the last three years, Wyong $50 per week plus in the past 3 years, Ipswich $20-$30 per week in the past 18 months… in my portfolio, I have had not had not one property either stay flat or go backwards in rent. All the increases are driven by demand – nothing more, demand comes from population growth which doesn’t occur for 1 or 2 years, they are a trend that occur over much longer periods of time…

      So I do believe the current scenario you describe is a reflection on the original choice.

      If there is anything I can agree with you on, is that I am not an NRAS expert, never claimed to be as i won’t put my money there… but I do see the neighbourhoods where many of them are…

      The best thing on my side is time… and i will sit and watch the NRAS stories roll through the press in years to come

      Cheers Todd

    • Trisha September 16, 2014, 8:56 pm

      The onus for ‘due diligence’ in on Real Estate Agents, Conveyancers etc. See the following from NSW Fair Trading, especially the last two paragraphs.,_misleading_or_deceptive_statements

      False, misleading or deceptive statements

      A statement is taken to be false or misleading if it has a reasonable tendency to lead to a belief in the existence of a state of affairs that does not in fact exist, whether or not the statement indicates that the state of affairs does exist.

      Misleading or deceptive conduct is a concept that has been broadly interpreted judicially. Conduct is misleading or deceptive if it is likely to lead a reasonable or ordinary member of the class of persons to whom it is directed into error. Misleading conduct can include acts of silence or omission. Conduct can be misleading even if the agent does not actually make any representations. It is not relevant whether the agent actually intended to mislead anyone to establish liability. What is relevant is the overall impression created by the conduct and its actual or likely effect on reasonable or ordinary members of the target audience (prospective buyers). Any type of conduct related to the photographic advertising of real estate that could give a consumer the wrong impression may potentially breach the Property, Stock and Business Agents Act 2002 and the Fair Trading Act 1987.

      Agents must ensure that any claims made about any property or land characteristics in any photographic representations and advertising are accurate and could not give prospective buyers the wrong impression. Statements made in conjunction with photographs of the views and facilities available in a local area must not be false or misleading.

      All efforts should be made by agents and their employees to provide an accurate picture or impression in the consumer’s mind of the features of the property being offered for sale.

      Agents cannot avoid liability simply by claiming that the buyer or consumer should have made reasonable enquiries and checked the information provided. Agents are responsible for their words and actions in their dealings with their clients.

  • Lynn November 3, 2012, 12:23 pm

    Hi Todd Glad to see you have the guts to get up and speak. I am a property investor and I wouldn’t touch them with a barge pole. I hope I have turned my son away from this type of investing. These suburbs are most likely to end up like the socio-economically disadvantage area like Inala used to be! And now the govt is knocking the houses down and selling the land off.

    This scheme is not wealthy man’s thinking aka Robert Kiyosaki investing. Keep it going!!

    • todd November 4, 2012, 10:46 pm

      Hi Lynn,

      Thank you for your comments… we really do have a divided audience on this topic. Time will be the true test here… and I am happy to sit back and wait for the results. The difference here with NRAS is that the properties are owned by investors and not the government. So knocking them down and rebuilding here won’t be done… so the problems remain.

      Robert has some interesting times ahead, his thinking is great… his current finances are not so much.


  • kate November 3, 2012, 2:59 am

    I think simply you do not know what you are talking about actually. Why did you think NRAS only increases rent @ 4th and 7th year. This is when valuations are done and rent increases yearly with CPI as does NRAS benefit.

    As for the rest of the portfolio you are also incorrect and it amazes me you are happy to make statements repeatedly that are false and that you know nothing about – but it all suits your argument I can see or you wouldn;t need to use sarcasm.

    I suggest you go for the fork as you seem quity angry – it may releive some pressure for you 🙂

    • todd November 4, 2012, 10:36 pm

      Hi Kate,

      By your response I would appear that it is you that are angry… if you knew me you would know I am most laid back guy, some would say too laid back.

      My comments come directly as a response from what you have written. I have re read your valuation statement and as I read it, it was referring to valuation of rents, but it appears you didn’t mean that. Just to correct you, as I have been in the past… the rent does not increase with CPI, yet it increases in line with the Rental CPI.

      So now I understand what you were trying to say, let me say this: if you are only valuing your portfolio every fourth and 7th year, then I would recommend doing this yourself more regularly… property investing is a large part of many Australians retirement portfolio and should therefore be revisited every year as a minimum.

      Knowing what I know about NRAS ( and yes from your view that is about zero )… I understand why they only value them after four years. It means the property companies have four years to try and make back the huge kick backs they have made and do not have clients chasing them after first year or two asking why their portfolio has decreased significantly in value.

      Now if I am incorrect about your remaining portfolio, please correct me… but I cannot see why you are having to decrease the rents unless you have invested in areas without a high population growth, which creates strong rental demand. The fact that you have accepted students into your property either means you didn’t even know they were moving in and allow your property manager to accept any application or that you had no other applications and simply wanted the property filled… If I am wrong here, PLEASE tell me where… I do not see any other explanation.

      I hope you do receive a good valuation at the fourth year mark… but I fear you won’t. Love to hear back when you have it done and see how you went? ( yes sarcasm )

  • Roger October 16, 2012, 10:43 am

    Hi Todd and followers,

    I stumbled across this post when I was trying to research more into NRAS. I am feeling a lot of tension but enjoying the various opinons whether for or against NRAS.

    A quick background on me; I am an Accountant (not the best opener) and an aspiring investor. Only 12 months ago I bought my first property in Melbourne’s South East – Doveton. This has been a quantum learning experience and I guess the spring board for the confidence to start investing. I look forward to learning off some of the ‘big dogs’ on here such as yourself Todd.

    Todd, I guess to your disappointment but to some other’s praise, I have entered into the purchase of an NRAS property only weeks ago. It is an off the plan apartment in Melbourne CBD on William St.

    Allow me to outline a few facts about the property and things that I considered before purchasing. I looked at some of the fundamentals in the area such as infrastructure, accessibility, amenities etc,

    More specifics:
    – I paid $455,500 for a 2 bedroom 1 bathroom apartment (no car space).
    – The commission the agent received was 1% on contract signing and 1% on settlement ie; $4,555 x 2 = $9,110
    – 10% deposit up front, balance on settlement Apr-Jun 2014
    – 21 level building, 541 apartments, approximately 40 of which are NRAS
    – off the plan, new so the stamp duty savings, high depreciation deductions etc; nothing new there
    – the contract does not bind me to a particular NRAS approved agent so I have the flexibility of choosing the property manager – so I’ve been informed
    – The building is in the middle of the legal precinct littered with courts as well as behind the Deloitte building and various other office spaces
    – Walking distance from Flagstaff Station (part of the City Loop)
    – I’ve been told (by the seller) the market rate is between mid $400s to low $500s

    Coming from a tax background, the benefits according to my calculations stack up even with very conservative figures. However, how well they stack up to alternatives I guess is the question – still figuring this one out.

    The catalyst to me signing the dotted line was my mentor who has a sizeable portfolio (12 properties) and the fact that he purchased one. Good decision/bad decision, hard to say yet.

    Now how my situation varies from the horror stories (Howard Ave – Kevin and Adam) is in the fact that it is in the heart of Melbourne and it is a small percentage (less than 10%) of the entire development dedicated to NRAS. Will this really have an impact on capital gains for my purchase or the others in the building – I am inclined to say no. I can have input in selecting tenants and based on the businesses in the area, I have a good chance of attracting clerks, accountants and the like as opposed to low income nightmarish tenants. So really the question in my mind comes down to did I pay too much?.
    Based on the facts I have presented, I look forward to any comments and especially would be interested in your opinion Todd. Are there other questions that I should be considering?


    Small time player in a big dog blog.

    • todd October 23, 2012, 7:03 am

      Hi Roger,

      Welcome to the debate… as an accountant I can see exactly why you would like NRAS as the tax savings with NRAS and the depreciation on a new unit would appear attractive to yourself. And to some extent they are to me as well. It’s the tenants and type of property you have purchased that I would not invest in.

      Jumping onto today, putting in unit, apartment in Melbourne and surrounding suburbs you will see that there are 1913 units for sale and 2064 units for rent…I guess thats why some developers are offering Holidays and new cars with every new unit purchased…

      These numbers show no huge demand but instead a Buyers market to both buy and rent… If I were a tenant looking for a unit, I would find ten units I like and put in stupidly low offers to lease them… and I bet I would get a unit for around 25%+ below market rents…

      So although the NRAS may appear attractive now, what happens when you decide to sell???

      If there are that many units for sale, then you will simply make no money…

      My other concern is that your property has no car space…even though your property is in the CBD and that most tenants will work close by, car spaces in CBD are an absolute essential. It will come down to the deciding factor when future purchasers look to buy your property and if they have several choices to buy and one has a car space and your does not, they will take the other.

      Did you consider the strata fees when buying a high rise unit? I understand they may have estimated a starting range but more often than not they are increased after first or second year to raise funds for the sinking fund… and many high rise units have strata fees from $100 per week up to $180 per week. Yes per week…

      In relation to whether you paid too much, I believe all new developments are over priced… unless the developer goes into liquidation and the mortgagee sells them for a steal… this result affects any growth that the earlier purchasers paid for the properties and the mortgagee will sell for much cheaper.

      Was the property purchased through a real estate agent or a property company?

      You may well find difficulty in having your chosen property manager, manage the property as all of the property managers I have spoken to, simply will not touch NRAS…

      I hope this helps… Todd

  • kate October 6, 2012, 7:30 am


    I also agree with Michael
    And I do not own any NRAS company.

    Many NRAS properties are in very good capital growth areas – that have limitations on how many NRAS properties are there so are not flooded at all – and no-one has to know they are NRAS (how can they know?)

    So – why would I buy next door for the same price when I get a better return on NRAS. I AM ABLE TO SELL TO ANYONE I WANT – AND IN FACT CAN OFFER THE REST OF MY NRAS TIME – OR SELL WITHOUT IT TO AN OWNER OCCUPIER OR INVESTOR. why would I sell though when it is the best property in my portfolio both with return and grwoth.

    A valuation is done in the 4th and 7th year and rent is aligned with the average rental so does not always change by 3% – in the meantime my NRAS property has increased by 3% and one of my non – NRAS has been reduced by 10% by advice from RE manager.

    I know all this because I researched it all properly with all the oonsortiums – my tax agent and lots more – and bought one.

    I bought my property completed and it is a home not an apartment – and did not enter into any off the plan arrangement. Just like all investment property it offers choices of off the plan – apartments, house and land and completed.

    I have a single mother who works at the police station in admin and has worked there for over 5 years. The lease is a 2 year lease.

    One of my other investments has had students who left every 6 mths and I now have a 5 person family not working in my 3 bedroom home.

    Hate to break it to you but with rentals – all your prospects are either medium or low income earners – so why not get paid extra for it.

    like any investment you have to do your homework.

    NRAS has nothing to do with the capital gains. NRAS is an addition to a good sound investment. Wise people understand this and don’t just get tax incentives regardless of what they buy and buy in good capital growth areas – whether it has NRAS allocation or not makes no difference.

    When whole suburbs are flooded with them it is because they are a low income suburb and again NRAS does not cause lack of growth. The suburb is what the suburb is – NRAS does not change the nature of the suburb!

    So when you want to discredit me – I have a portfolio of 7 properties and the NRAS is certainly one of the better properties. I have no personal interest in any NRAS area or consortium.

    Enjoy the fork in your eye!

    • todd October 10, 2012, 6:36 am

      Hi Kate,

      Quite the contrary… I applaud you for having such a sizeable portfolio. As an investor you are welcome to invest your money where ever you see fit and for you if that means that you want to buy an NRAS property then that’s completely up to you.

      Just to reply to a few of your comments… I know exactly where NRAS properties are and are not in a suburb, simply by asking… real estate agents know and property managers know as many of these properties are managed by local property managers on an agreement base with NRAS. No not all areas are flooded with NRAS, some suburbs they are scattered, but again if i were investing there, I would know.

      If your valuations for rental increase are only being done in the 4th and 7th year then I find this completely unacceptable. My personal portfolio has a rental increase EVERY 6 months… in the last 5 years I have only missed one increase as my portfolio is above market levels and I would rather the tenant stay. So if my portfolio increases on average $10 every 6 months, then you have missed out 8 increases = $80 per week in rent. Although with NRAS you already receive a discounted rent so I assume yield is not a high priority? You mentioned that it is your best property for growth, has it gone up in value? and why haven’t your other properties increased in value?

      Perhaps if you had done the same amount of research into the remainder of your portfolio as you have for your NRAS property, your rents would not have decreased and values stayed stagnant.

      I fear your other properties are not located in high population growth areas if the rent has reduced by $10 per week to simply get a tenant. Thats not the property’s fault, its the location of the property you purchased. Your students moving out every 6 months is again the property manager allowing this type of tenant into the property and ultimately you accepting their application. I would not allow student to lease my properties nor would I allow 5 people to live in a three bedroom home… you have the choice to not accept them but again if the property is not receiving many applications as it is in the wrong location, I understand why you have accepted.

      In locations I invest in, the tenants are middle class earners… and not ALL tenants are low income earners. Many tenants live in the inner city circle can be executives who wish to not invest in property, they might invest in shares… there are thousands of examples like this. I was a tenant until 4 years ago… then i purchased my home.

      Unfortunately NRAS does not have anything to do with capital gains as you say… I haven’t seen one sales evidence of a re sale where the vendor has made money on an NRAS property. Now in locations I have invested in the last 4 years I have made great capital growth. I currently have a client who owns an NRAS property in Adelaide and it has gone down in value by $60,000… now no amount of tax savings makes this a good investment choice.

      I completely DISAGREE with your comments on the about NRAS changing the nature of the suburb. Firstly, as most investors are paying up to $50,000 over the real value of the property through NRAS property sellers, it firstly falsely increases the median house price and then when they go down in value, it puts a false feeling on the suburb and takes away consumer confidence. So yes it does affect a suburb. I see this first hand… I would suggest you travel to more locations that have NRAS and see for yourself.

      I do hope that your NRAS property brings you some great tax savings… I know that I won’t be investing in this scheme.

  • todd September 6, 2012, 1:09 am

    So what an interesting topic this turned out to be. On one side we have myself and every other person who commented who do not sell NRAS properties, verse the NRAS on sellers.

    During my emotional responses ( sorry I take investing to heart ) I have asked many questions to which none of the NRAS sellers answered, yet they clearly diverted away from them.

    Questions like:
    • How many NRAS properties do they own?
    • How much commission do they make per property?
    • How many of the approved NRAS tenants to date earn $108,000. Stating the maximum income is one thing, but how many actually get approved at this level is another!

    See, I am a believer of only recommending properties in areas in which I personally invest. I believe if you sell NRAS you should own multiples of them, if you truly believe it’s a great investment. Would you buy a Holden if the salesman were driving a Ford???

    It was also interesting to see that every example I had noted was a “bad” NRAS location as stated from the NRAS sellers, and that there are actually “good” NRAS locations with good NRAS tenants. South Brisbane was noted as one of these “good” locations. Given the limited number of NRAS properties in South Brisbane, that doesn’t leave many properties to on sell for a large amount of NRAS sellers.

    Have those who have commented who sell NRAS only sell these “good” locations… or have they also sold all the other locations as well???…

    Lets see if they answer this one. I assume not.

    Now for some facts:
    • Massive referral fees and kick backs on many NRAS properties are paid to NRAS sellers, mortgage brokers, accountants, financial planners… up to $50,000 plus per property. All the investor sees are the tax breaks they receive, not the inflated property price.
    • I am yet to see a “good neighborhood” with NRAS properties there
    • I travel weekly all across Australia and do many miles driving per week and see these locations – I recently visited South Brisbane, did we forget that South Brisbane partially flooded 18 months ago???
    • Michael was happy to say I am wrong about being able to sell NRAS approved properties to only investors and the websites that stipulate NRAS conditions are wrong, yet he didn’t supply any reference points or websites to prove this apparent fact, so if I am incorrect in this regard, then I retract my statement… but I would still like to see where. If you were trying to promote that NRAS can be sold to owner-occupiers during the ten-year period, then why hide this information? Sounds like a secret to me, just like those commissions…
    • I believe there would be some good NRAS tenants – but they would be few and far between
    • I am yet to hear of an NRAS property being sold for a profit – which I mentioned a few times and the NRAS on sellers did not supply any sales data either, to counter my argument
    • ANZ do not include the tax rebate as income when servicing a loan, therefore limiting your ability to borrow significantly. They simply use the reduced NRAS rent and then only use 80% of that figure
    • A whole bunch of other lenders have tightened their lending criteria to the NRAS scheme as well

    And to end my opinion and comments on this topic, I am currently setting up some finance for a client so they can invest with myself. He owns an NRAS property in Adelaide. He has owned this property three years. So far in the three years of ownership, they value has decreased over $60,000 and the rent has only increased $5 per week, yes $5 per week in three years!!!… so much for the rental increase in accordance with the Rental CPI of 5.8% per annum since 2008.

    So Tim, I do hope you make all that “serious coin” you clearly state… I just question whether it was made through the capital growth of the property or through the commissions added to the retail sales price?

  • DJ August 30, 2012, 3:49 am

    G’day Todd and bloggers,

    glad i stumbled across this website. I have been negotiating on a SE QLD Off The Plan Complex which has 36 NRAS units within the letting pool, As a first time complex owner i have only just been introduced to NRAS and am still undecided on the negatives/positives that will happen within my business.

    If any onsite property managers have had any experience with NRAS units to date i would love to hear your feedback, such as extra paperwork, legals, tenants.



  • Andres August 28, 2012, 4:01 am

    Hi Todd,

    I was also doing some research on these NRAS properties as they looked appealing at a first glance but after some further investigation the points you have highlighted above did come out.

    The couple of things that puzzle me are:

    Why are the agent fee’s so high? Are they doing an exceptional management of your investment property which justifies paying them a 12% premium of your rental income (which is supposedly already 20% below market value). And unlike in normal circumstances when you’re property manager is doing a not so good job you can fire them and easily get another one this really isn’t the case with NRAS.

    I think the Gov had good intentions to begin with but when all the companies who responded to the tender to be part of it saw the $$$$ from being able to get money from the government without fear of competition they decided to take the ride for all it was worth.


    • todd August 28, 2012, 5:48 am

      Cheers for your comments Andres.
      We’ll wait and see or hear about the stories that come from investors buying NRAS properties..

      Like any government backed “scheme” there will always be people who take advantage, its up to those purchasing to research the property with others in the market, do your due diligence on the company selling you the property and make sure you yourself are 100% of the costs associated…

      As I said, watch this space over the coming years, we’ll see plenty of diverse stories from NRAS purchases.

      • Trisha Fitzsimmons September 16, 2014, 9:01 pm

        The onus for ‘due diligence’ in on Real Estate Agents, Conveyancers etc. See the following from NSW Fair Trading, especially the last two paragraphs.,_misleading_or_deceptive_statements

        False, misleading or deceptive statements

        A statement is taken to be false or misleading if it has a reasonable tendency to lead to a belief in the existence of a state of affairs that does not in fact exist, whether or not the statement indicates that the state of affairs does exist.

        Misleading or deceptive conduct is a concept that has been broadly interpreted judicially. Conduct is misleading or deceptive if it is likely to lead a reasonable or ordinary member of the class of persons to whom it is directed into error. Misleading conduct can include acts of silence or omission. Conduct can be misleading even if the agent does not actually make any representations. It is not relevant whether the agent actually intended to mislead anyone to establish liability. What is relevant is the overall impression created by the conduct and its actual or likely effect on reasonable or ordinary members of the target audience (prospective buyers). Any type of conduct related to the photographic advertising of real estate that could give a consumer the wrong impression may potentially breach the Property, Stock and Business Agents Act 2002 and the Fair Trading Act 1987.

        Agents must ensure that any claims made about any property or land characteristics in any photographic representations and advertising are accurate and could not give prospective buyers the wrong impression. Statements made in conjunction with photographs of the views and facilities available in a local area must not be false or misleading.

        All efforts should be made by agents and their employees to provide an accurate picture or impression in the consumer’s mind of the features of the property being offered for sale.

        Agents cannot avoid liability simply by claiming that the buyer or consumer should have made reasonable enquiries and checked the information provided. Agents are responsible for their words and actions in their dealings with their clients.

  • Tim August 20, 2012, 10:14 am

    Thanks Todd
    Keep bagging NRAS using hysteria and sensationalism. Keeps the uninformed and lazy away and makes it much easier for those that understand the real facts to make serious coin

    • todd August 28, 2012, 5:52 am

      Hi Tim, thanks for reading my blog.
      I certainly wouldn’t call myself lazy, researched and experienced in buying properties yes, but lazy, no.
      Given its evident you dont agree with my comments and thoughts on NRAS, I’d like you, when you have one, send me a good news story of a customer who has purchased on of these great investments, and how their returns are going? This should include rental growth, capital growth and tax benefits, not just one of the three.
      We wish you good luck in your future property purchases..
      Cheers, Todd

  • Danny August 15, 2012, 6:24 am

    Todd like the response to Michael Sloan sounds, like he needs to do get himself educated and do some research himself.


  • vikram August 14, 2012, 10:48 am

    awesome reply Todd.

    • todd August 15, 2012, 6:28 am

      Nice to see a real estate agent making a point from their own point of view… Cheers Peter

      Welcome Thomas to the discussion, when you first posted, your email address looks fake, so it was never approved but given you have gone to the effort of writing a War and Peace sized response, who am I to deny you a say. Looking at your detailed response I assume you are also in the NRAS field?

      Welcome John, been a while… yes I do remember when we first met back when you just started broking and you were contemplating buying some property with myself. Shame you didn’t buy them back in the pre WA Boom days as the houses were $70,000 – $90,000 that were rented for $90 per week then. I remember you had a portfolio that was quite cash flow positive and you were heading down that path. Mortgage broking for myself has been a great 10 years even with new NCCP extra workload. Shame you didn’t buy a dozen of those little cheapies in WA as you would have definitely been retired now… the rents are now $240 – $290 per week and the houses tripled n value. I did notice John that you didn’t actually mention that you owned a NRAS property before or now???

      John yes an agent can earn a commission on, but at what point does this commission change from looking after the client – to looking after your own pocket?
      $10,000 ?
      $20,000 ?
      $30,000 ?
      $40,000 ?
      $50,000 ?

      And if the commission was paid from the normal retail price of the property and the agent disclosed this in their contract, and the client is made fully aware of it then that would be ok… but unfortunately it is not paid from the normal price, it is simply added to the retail price. On disclosure… even I’m not going to touch that can of worms…

      I noticed you mentioned South Brisbane so I will address this location later as it seem like the “preferred” NRAS location.

      The article in YIP magazine did not have all nine judges say that South Brisbane was their number one spot. The start of the article states that 9 judges put forward their preferred spots then YIP did their homework on them and judged the best in their eyes. The article has Sam and Jeremy commenting on South Brisbane only. Not that I am disputing anyone’s chosen suburbs but had been 9 different experts then we would have a different outcome… nature of the game…

      Do Sam and Jeremy sell new properties? Yes

      So I think I need to clarify a few things here… The blog was written was about my opinion on NRAS, and by the look of everybody else who have responded that are not selling NRAS, they agree. If I were promoting NRAS then I would have gone into the specifics, know the product inside out, and put a positive light on it, but I’m not. It seems with Michael’s comments that, even the NRAS agents selling these properties, also don’t know what they are talking about either in relation to this scheme???

      I am yet to see a professional investor buy NRAS as their portfolio…

      I invest for capital growth… Yes cash flow is great to build a portfolio but it’s the growth that makes you wealthy… I achieve this through investing in low risk properties, and many of them.

      The fact is that there are a huge amount of companies selling this new fad of investments… And Thomas I am yet to find a development out there that doesn’t offer massive kickbacks, NRAS or not. This week alone I have been offered to sell units… And sorry John it was in South Brisbane, as this is the “latest craze” suburb to be saturated with them. I was offered a $44,000 referral fee for every unit I sold. This $44,000 was not taken off the purchase price, it is added. Meaning that if I were to walk in off the street and buy the same unit, I could get one $44,000 cheaper. Is that looking after your NRAS investor?

      I haven’t even started to negotiate my referral fee… I reckon I could get $50,000 per unit easily if I sold enough of them. I was also offered to buy one myself for another $50,000 cheaper than the street price if I could sell 6 units for them.

      Unfortunately like Docklands, Darwin and Pyrmont, the Brisbane inner city units will be the next location to be oversold in price and over supplied in volume. If what’s happening in Melbourne right now is any indication, they are going backwards in value rapidly and the vacancy rates are extremely high, not to mention strata fees from $100 per week up to as high as $200 per week for high rise unit blocks. Yes per week…

      Unfortunately the yields expressed in the magazine don’t include strata??? They certainly don’t reflect the reduced rent of 20% in their median rents. The suburb looks like being chosen by only 2 of the nine experts John and then awarded best suburb by YIP magazine. Now not saying the suburb won’t perform but I simply do not buy units due to massive strata fees and over supply.

      Using the YIP Top Suburb figures John, the median unit price is $475,000 with a Median rent of $510 per week. They state that this is 6%… they must have a special calculator as I get 5.58%. To achieve 6% yield you require $548 per week.

      There are numerous new blocks under construction in the area and I will be in Brisbane next week and I will go to South Brisbane and view for myself. Stay tuned as I will post back with what I think of the area.

      Currently there are 38 units available for lease in South Brisbane with apparently 1000 residential units in total. This is low and great for the suburb but with many more units coming up for completion this will change rapidly. When a new block is completed there can be 100’s of units available for rent in one day… not the ideal situation.

      But lets look a little further abroad… adding the neighboring suburbs to South Brisbane you now have 423 units available for lease and wait for it… 774 units for sale. The area does not have so much appeal now does it???

      What about the three new high rise towers to be built in Milton shortly? And that’s only what I have heard, bearing in mind that I don’t research inner city units.

      Now what does this have to do with NRAS???… well not only do we have a gluttony of units available for rent & for sale… I will also be paying a massive commission to somebody, well above the market value plus I will have huge strata fees…

      Sorry not my cup of tea…

      Shall I add that new apartment blocks and high rise units nearly always start with a strata budget in mind and then they increase each year to build a sinking fund as they must start to build their slush fund to cater for future repairs… I am experiencing this right now with my office, my only strata property.

      Thomas thanks for clarifying the “Non for profits” and the “For Profits”… so it’s these 11 “For Profits” that are generally charging the huge commissions on the sale price and if I read your article correct they also manage the property??? Or is this in both arena’s?

      What due diligence has been done on these firms to manage a property correctly? Things like:
      • What software do they use?
      • What rent arrears procedures do they have?
      • How often are they running their reports?
      • How many tenants per manager?
      • How often are inspections done?
      • Are they done?

      I have spoken with my property manager in QLD and she was offered a share arrangement for her to manage these properties but is was definitely not worth it as she did not want the issues that go with these properties.

      I disagree with you Thomas that these tenants are not government backed… they have been approved so that they can pay 20% below market rent… meaning they have been backed by a scheme that the government has put in place to allow them to pay less rent. Similar to pensioners receiving 20% discount of their medicines… is that not government backed? If the government did not do this, would the chemist just say “ Hey, your old, I reckon I will give you a 20% discount?”

      I think not…

      Now you mentioned that the rents are not increased to CPI but tied to the rental CPI… lets look at that. Lets use South Brisbane. YIP states median rents are $510 per week:
      • $510 per week at CPI of 3% = $15 per week
      • $408 per week at Rental CPI 5.8% = $23 per week
      • $510 per week at what we achieve = $30 – $50 per week

      So Thomas 5.8% at a lower base does not make a massive difference to the overall $$$.

      Using the same percentages on properties in my price range:
      • $320 per week at CPI of 3% = $10 per week
      • $256 per week at Rental CPI 5.8% = $15 per week
      • $320 per week at what we achieve = $20 – $38 per week

      I know what I would prefer…

      Now when I calculate whether a tenant can afford to rent my property, I use a net per week dollar income x 30%. This way the tenants can afford the rent now and when they increase every 6 months for us ( even on a 12 month lease ) at levels quoted above. To use South Brisbane figures and the scenario Thomas has put forward ( bear in mind I am using South Brisbane as it has been pointed out as a “good” NRAS location and someone who can earn $108k taxable income would want to live in a good NRAS location verse all the bad locations ) to what level they can afford to pay NRAS reduced rent. This is what I calculate:
      • $108,000 = $1,508 per week net income
      • $1,508 x 30% = $452
      • Current rent to be charged with 20% discount = $408 p/w
      • So by the start of the third year, someone on maximum income under NRAS cannot afford the rent. Yes their income can increase for 2 years but they may take them to year 4.

      In relation to the female being on maternity leave. I will only consider her maternity income is she is a government worker and guaranteed a job when she decides to go back to work. The time on leave and remainder of time on part or full pay is also taken into consideration.

      Now what if they are approved and only earn $80,000 would you let them into the unit?

      Now to factor in the strata plus interest on the extra $44k you pay at 6% on your loan, how cash flow positive are these properties? Also we must factor in the 20% reduced rent. Lets do some numbers:

      For the exercise, I will use South Brisbane as it apparently is one of the better areas to buy NRAS and I will use the figures supplied by YIP. Our investor is using equity in their home to buy the unit and their interest rate is 6%. The applicant earns $80,000 per annum. I have assumed a gross depreciation of $7,000… now please correct me if I am wrong as I don’t see a lot of depreciation schedules for high rise units.

      Purchase Price -$475,000
      Stamp Duty – $ 14,500
      Legals – $ 1,300
      Transfer – $ 800

      Total – $491,600

      Rent for this unit is $510 per week – 20% discount = $408 per week.

      Before tax benefits and NRAS benefits this property costs $207 per week. After negative gearing and depreciation the property costs $133 per week.

      Now lets add an average strata of $120 per week = $253 per week.

      Now lets use your $10,000 per annum rebate from government = $192 per week.

      This property is still negative by $60 per week…

      And if i were to add the referral fee of $44,000 to the equation then its $98 per week.

      Not positive at all John… and that’s now that interest rates have come down… imagine how scary this scenario was at 7% which wasn’t all that long ago???

      If we substitute the units for a house and lose the Strata, then it’s neutrally geared…

      I thought NRAS was suppose to be the savior to cash flow positive properties???

      I was told also that Essendon was another good NRAS location, yet simply looking at the median unit price of the area in the last three years, not a lot has happened…

      To refer to your strategy Thomas about paying off your home loan by putting your $6-$7k net cash per annum onto the home loan… looking at the above figures. I would say you would need to be putting this cash towards making the loan repayments.

      So although you mention NRAS as a scheme is good, it’s only good on paper… In theory. the reality is that I wont put my money there and nor will I recommend it to any investor.

      If and when a good new story comes from NRAS, I will be happy to publicise but I wont hold my breath.


      • Lachie August 19, 2012, 1:35 am


        Thanks for your thoughts on NRAS, i read over them with interest as I have previously looked at buying myself. Im going to keep this short, in reply to your post and i quote,

        ‘Using the YIP Top Suburb figures John, the median unit price is $475,000 with a Median rent of $510 per week. They state that this is 6%… they must have a special calculator as I get 5.58%. To achieve 6% yield you require $548 per week.’

        I have also tried using my own calculator and agree the yield is only 5.58%. My question is how do I get a calculator that will up my yield so I can retire earlier?


  • Peter August 14, 2012, 10:12 am

    As a selling and leasing agent I could not agree more with your comments and concerns in relation to NRAS houses. The “scheme” is designed to do two things, 1. Help people save for a home deposit, which in turn could see a high turn over of tenants, resulting in higher wear and tear on the home and losses of rental income through re-letting fees OR 2. Provide accommodation to those that can not afford current market rent. We have seen this before with Housing Commission Estates.
    I have seen suburbs have rent reductions as there have been some NRAS houses nearby. This has caused the current rental properties to need to adjust slightly to compete.
    I have done some extensive research on behalf of my current investors and have given them a resounding NO in relation to buying NRAS. The only possible scenario where this may have benefits is in a self funded super scheme that is looking for long term holdings, but my advice is steer clear as the crystal ball does not show that far ahead

  • Thomas August 14, 2012, 9:58 am

    I think there’s still a bit of incorrect information here, whether it be missing or misunderstood or whatnot… but I will try and clear up a few of the myths. As I posted previously ( the post wasn’t published…)

    Families with taxable (not gross) incomes of up to $108K can qualify as tenants, and need to to exceed the qualifying threshold by 25%, 2 years consecutively before losing eligibility. So for a couple with 3 kids where the wife is on maternity leave or works part time, the 108K income they qualified through, can grow to $135,212 before breaching the allowable limits- and that has to happen 2 years running. So while this may not be ultra high household income, nor is it the income of a dole bludging unemployed pensioner/welfare recipient type of a tenant!

    Income thresholds increase annually in line with CPI, and the income thresholds set down for NRAS actually cater for over 70% of all income tax paying Australian citizens, based on the latest census figures. Implications that this is a welfare recipients paradise are unfair and incorrect. More on this later.

    The comments about the tax offsets are incorrect. The Refundable Offset is in fact a net number, and is payable no matter what your Marginal tax rate is, even if you have ZERO taxable income or are a foreign buyer, it is paid in full. Not any attack on you. Lots of people fail to get how this works. It’s a very common misunderstanding. Hopefully this helps everyone understand whats myth and what’s fact.

    Also, unfair to say these are Govt backed tenants. The investor is the recipient of GOVT incentives, not the tenant. Tenant gets a discount on rent. Govt doesnt provide that. The investor does. Sure, the Govt compensates the investor for it, but not sure how that makes them Govt backed tenants. After all, doesnt the Govt compensate just about all investors who use the Australian taxation system one way or another to assist them in developing an investment property portfolio?

    And finally – the NRAS incentives are NOT tied to CPI – ie 3%. They are tied to Rental CPI, which has provided an average of 5.8% increase annually, between 2008-now. Here are the facts. Started at 8K in 2008. 8600 – 2009 9140- 2010 9524 – 2011 9981 – 2012

    So, those are the facts from the blog piece that I think needed some clarification.

    Now- on your point regarding the property managers – you make a valid point kind of,sort of, but it only tells a small portion of the story, unfortunately. This is another misunderstanding that is quite common; Understanding the consortiums- the difference between the “for profits” and the “not for profits”

    Bare with me; this takes some explaining- There are 137 “consortiums”( real name is approved participant) who hold NRAS allocations, allowing participation in the scheme, and community housing groups/not for profits represent 126 of the 137 “consortiums”. So on the face of it , its easy to argue that they are the majority, so most NRAS must be junk, tenanted by pensioners or junkies or nutters, and managed by community housing groups. Scary stuff, right? I get what you’re trying to argue..but there’s a huge detail missing in the argument.

    The 126 “not for profits” control less than 30% of the 50,000 NRAS entitlements, and none of their “stock” is available to you or me or the readers. We cannot buy through their “model” and we cannot participate in the NRAS using their stock. So using them as the example for all NRAS isnt at all fair or reasonable. They are irrelevant.

    It is much fairer to evaluate and critique the remaining 11 “for profits”, who control over 70% of the NRAS entitlements issud by the State and Fed Govt’s, and who DO allow you me and the readers to buy NRAS approved stock which they hold the entitlements over, and who DO allow us to participate those properties in the scheme.

    So far only about 8600 NRAS have been delivered, and most have been delivered for the use of community housing/”not for profits”… so far. Groups such as Monash University, Australian National University, Mission Australia, Baptist Community Services etc have built accommodation for students for example…. so yeah, it’s easy to tar it all with the “stigma” brush. I get that. At first glance it looks like community housing for pensioners and students- so it must all be like that, right?

    Well, no. Wrong! As I said above, these “not for profits” dont allow you or me or the readers to purchase properties that hold NRAS allocations, and participate them in the scheme. They are in this for themselves and their clients ONLY. They keep them all for themselves, as an institutional investment. So readers of your blog would never be buying from the Illawarra Retirement Trust or the Uniting Church Property Trust, for example. They are a completely separate beast to the “for profits” who DO allow your readers to participate a property in the scheme, so they arent relevant when assessing the NRAS opportunities available to you or me or the readers.

    So we should be talking about the properties that you and I and others CAN actually purchase to participate in the NRAS. And that means discussing the “for profits” rather than the “not for profits” you have used to support your argument in the blog. The not for profits are absolutely irrelevent you see- as you cannot buy their stock.

    So – the “for profits”…their stock… is it any good? Well, yes and no. I have to agree with Todd on this- in many cases marketers charging 30-50K have ruined the scheme’s attractiveness in many parts of the country where NRAS has been rolled out in limited numbers so far. You are absolutely right on that Todd. This applies to QLD especially. Because despite all the cash flow advantages available, and despite the genuinely good quality of most of the projects, the “numbers” are spoiled when valuations require investors to start from 30K or more, underwater. No argument here. But this is NOT the fault of NRAS. It is the fault of the sellers – ie the marketers who charge such outrageous comms to sell new development stock. It is unfair to blame the scheme for the actions of property marketers. There are many examples of NRAS approved properties valuing right at contract price, in other states.

    So the long and the short of it is, I think that the NRAS scheme is much much better than portrayed in the blog- the tax offset is fully refundable no matter what, the income thresholds are way higher than pension levels as suggested, the types of tenants and property managers used by “for profits” are completely different to the “not for profits” which the article uses to talk down the scheme, and the incentives are tied to rental CPI, not CPI. But the blog is absolutely right that the house and land merchants are overcharging for comms and that makes the valuations a tough pill to swallow.

    The blog also fails to recognise the enormous debt reduction you can achieve by redeploying the 6-7K of tax free positive cash flow a typical NRAS property generates, onto your non deductible mortgage over 10 years. It’s another point very often overlooked, so let me try and give you a very quick example; a person with a 250K P &I mortgage would save over 17 years off their mortgage if they paid maintaned normal repayments but added 7K per year in lump sum extra repayments onto their mortgage over 10 years. Dont believe me? Open an extra repayment calculator on any lender site and see for yourself.

    That’s a whole lot of CGT free profit if you ever sell your PPOR. It’s a whole lot of interest saved ( hundreds of thousands) or it’s a whole lot of free accelerated equity with which you can very quickly re-invest, all achieved with zero out of pocket expenses (these are negatively geared by still highly cash flow positive remember).. so Im just suggesting that NRAS is far more than meets the first glance.

    So if you can buy at good value ( and you can- just stay away from the marketers SEQld house and land packages. Todd’s dead right on this point) NRAS can be a much much better deal than has been suggested by the blog, but only if you don’t pay “overs” for the property, from day 1. If you get a good valuation – the cash flow benefits are amazingly powerful.

    FYI the groups to critique, if you wish to critique NRAS, are;
    Queensland Affordable Housing Consortium
    Aspire Housing
    Yaran Residential Investment
    Aspire Housing
    Ethan Affordable Housing
    Providence Housing
    Affordable Housing Consulting
    Affordable Management Corporation
    Brisbane Housing Company
    Quantum Housing

  • John August 14, 2012, 7:41 am

    Hi Todd

    I can understand your apprehension about NRAS, however I think its unfair to taint all NRAS properties with a negative brush. As a mortgage broker, I can say there are lenders that WILL lend on NRAS properties and there are some lenders that wont. There are slowly but surely more lenders everyday coming on board as they get their head around the potential risk. Its our job to help find those lenders!

    A couple of points;

    1. Are Kevin and Adam above talking about NRAS or housing commission?

    2. Most NRAS properties are in locations I wouldnt touch. However, there are some odd exceptions that are worth evaluating. Consider South Brisbane – the number one suburb rated in this months (AUGUST) Your Investment Property magazine by 9 different property experts. 15,500 suburbs were rated and South Brisbane came out on top. There is a development there where some of the units have NRAS incentives. 9 different property experts with different perspectives on the Australian property market have all agreed that this area has strong growth prospects. The cream on the cake is that it may cost very little to hold from day one even with borrowing 105% thanks to NRAS.

    3. You can sell the property to an owner occupier. You need to give about 6 months notice to opt out of the scheme. A bit of forward planning can help prepare the exit strategy.

    4. Some of my clients have equity but very little cash flow (eg a single mother earning $60k a year). NRAS allows this client to buy something new with little headache and costs very little to hold. Better to buy in South Brisbane than not do anything for her retirement!

    5. So long as the investor pays fair market value and is not being ripped off, then whats the problem with an agent earning a commission? The developer can pay as little or as much as he likes.

    6. I semi retired at age 32 because of my property holdings and became a mortgage broker (rocks in my head!). 10 years later I am still investing and am a guest commentator in the press and on television. I hold no where near the amount of property you do now because I am too lazy! In that time, I have bought off the plan, renovated, pursued cash flow positive property, went for “value for money properties” and learnt one truth. There is no one single way to invest. I have made money more or less on each transaction. NRAS is yet another way that has the potential to explore.

  • Michael Sloan August 13, 2012, 1:49 am

    Todd, you are kidding if you think your post is accurate or informed.

    I have to say, I have read some misinformed comments about NRAS on a range of websites that just leaves me shaking my head. That includes plenty from companies selling these properties.

    But these comments are as bad as I seen, so many points are just opinion stated as fact and many are just plain wrong.

    I don’t have time to address all the comments in the blog but just in case there is anyone reading this that is investigating NRAS properties I will correct one glaring mistake.

    This comment.

    If you decide to sell before the 10 years is up, then you are limited to selling to investors only, limiting your potential buyers to about 30% of the market.

    Is wrong, that is just not true, do some research and you will see I am correct.

    I think Todd, you have fallen for the same mistake as many others, that is you believe what you have read on Google rather than doing your own research.

    By the way, the comments from Kevin and Adam have nothing to do with NRAS.
    Michael Sloan

    • todd August 13, 2012, 10:16 am

      Oh Michael, thanks for your comments… I am going to have fun here, as you have tried to discredit myself and I am about to prove you wrong… yes sorry but that means I must now go into NRAS in more depth..

      For those who do not know Michael; well neither did I, until now… Michael actually owns a company that promotes NRAS. Your comments look like you were trying to promote your own business… so lets do that. Michael’s business is

      I noticed you said I am misinformed and not accurate… so if by chance, the ATO and Australian Government Department of Families, Housing, Community Services and Indigenous Affairs are promoting wrong information about NRAS then YES I am guilty… Now’s who’s kidding Michael?

      I reckon you should have done a little research on me before posting on my Blog and trying make yourself as the NRAS expert. I research locations to invest in, yes research, and then buy there myself. At the same time I facilitate the purchase of investment properties for other investors.

      So what do you do? I noticed you sell NRAS house and land packages and are paid your commissions by the vendor, which means the land developer and builder. This is clearly stated on your website

      It also states that as investment advisers you are paid for by the vendor but act for the purchaser. Where does your interest really lie?

      I receive emails, parcels and phone calls from developers, builders and land developers almost on a daily basis asking me to sell their stock. Obviously they don’t read my website either… and would you believe that the commissions are as high as $50,000 per property. How much do you make per property Michael?

      If its $50,000 is that acting in the purchasers best interest?

      Even @ $30,000 is that acting in the purchasers best interest?

      I’m not sure on the commissions or commission range that your company receives as your website clearly left that part out.

      How many NRAS properties do you own Michael? Your website doesn’t make any mention of this. Do you practice what you preach?

      Have a look at my website and you can see how many properties I own… and not one is an NRAS property.

      On the finance front, I assume you already know that lenders:
      • Have tightened their policies and reduced lending to NRAS properties
      • Ceased lending to NRAS properties
      • Never lent money to NRAS properties

      Have all the banks analysts and Risk Assessment officers also been misinformed on NRAS too Michael?

      To help them assess risk the banks ask the valuer’s to put a risk rating on the likelihood of the property decreasing in value. Given the latest lending criteria mentioned above, have all the valuer’s in Australia been misinformed on NRAS too Michael?

      Maybe the valuer’s believe the values will decrease due to large commissions companies receive on these houses?

      Now to answer a few of your concerns; yes my Blog is written by me and yes it is my opinion… I’m sorry for not pointing out some of the so called “positive” points on NRAS as I am yet to find one, in my “opinion”.

      Now to address my one “glaring mistake”: It was that if you, the NRAS investor, decide to sell the property within 10 years then you are limited to selling to investors only.

      Well this clip comes straight from

      NRAS dwellings can be sold without penalty during the 10 year holding period:
      a dwelling can be sold to another investor who undertakes to comply with NRAS obligations

      Now it does say that you can substitute that dwelling for another dwelling for the remaining part of the ten years… but hey who is going to do that… Are you kidding?

      Is that the best you have got? Glaring enough for you!

      So outside of the substitution clause, your property can only be sold to investors in that 10 year period, which is around 30% of purchasers nation wide. Now using your words, do some research and you will see I am correct.

      Now to go a step further, lets look at the property managers of these schemes. Hmm interesting, cant wait to have them manage my property…

      Now Michael when you posted on my Blog, I was in the Ipswich Shire that day, which has a considerable amount of NRAS properties. Lets cover off a few facts:
      • My property manager will not take on a property management anywhere near an NRAS house or NRAS community to lease for an investor – she simply refuses to due to the problems that arise
      • The houses are around 3-4 years old and were sold for between $50,000 and $130,000 higher than their current value. Now that makes for some great investing right there… NOT!!! and Michael, I have seen the sales history figures… might have something to do with those commissions I mentioned earlier?

      So I hope this covers off my research that apparently I do not do.

      Now lastly addressing your last line in relation to Kevin and Adam’s comments having nothing to do with NRAS. Well Michael, comments come from anyone, including you, and are the opinions from other people’s thoughts on my topics. I noticed that your Blog doesn’t allow for comments at all??? How interactive of you…

      Now whether the location they mentioned were NRAS approved investments or not, I am not sure, but what I can tell you is that my example in my Blog surely was NRAS and Kevin and Adam’s reply’s sound awfully similar.

  • Adam August 8, 2012, 3:28 am


    I was in the exact situation that Kevin described. Moved into a brand new apartment in Howard Ave, and everything was fine for the first month as new couples and families moved in, all paying top dollar for the area.

    Then the ground floor was mysteriously filled, and the problems began. Shouting, vandalism, garbage piled up, cigarette butts everywhere.

    Unbeknownst to us, the owner had leased the entire ground floor to housing commission, at less than half the rent we were paying. The break-ins started happening shortly after that, with 6 cars hit in a single night in the secure garage area.

    The security locks and doors were damaged because they caused an “inconvenience” to the ex-army, ex-homeless schizophrenic who took it on himself to remodel the apartment block with a massive shifting spanner if he didn’t have a key.

    We had a prostitute working from her home, and a car burnt out just down the road.

    The advantage was that should the police need to be called (happened 3 times) they knew exactly where to come since they visited the block twice a week to collect or drop off residents.

    As you might have guessed, we moved out very soon afterwards, and will NEVER rent in a brand new block of apartments again.

    At no time were we ever told of the possibility that the apartments could be housing commission, and were paying a premium because the apartments were brand-new.

    Frankly I was left to question why I should bother to work overtime and strive to achieve since in the end I lived in the same accommodation as people whose only contribution to society was a daily visit to the TAB and bottleshop.

  • Kevin August 7, 2012, 11:54 pm


    I know exactly of such a place in where I used to live. Howard Ave, Northmead NSW had a new bunch of units go up near the end of the street. Sold off all the units levels 3 and above to investors then later on the first two floors became housing commission. They didn’t tell anyone about this of course and its how they got the planning approvals through council. As a consequence the value of all the properties on that street dropped and I can guarantee you that if residents knew that was going to happen they would have outright rejected the development application.




    • Nicky pong December 14, 2012, 1:55 pm

      Hi I got confused, I intend to buy an NRAS inv house n land package 3br w ensuit, double garage in vicker road, Sebastopol ballarat 300k, in a mix with non nras houses development, not sure is a right decision. Please advice, thanks, nicky

      • todd December 17, 2012, 12:41 am

        Hi Nicky,

        Even before you consider if that property is suitable as an NRAS, I would be considering whether I would buy at all as Vickers St and Albert St were flooded in the 2011 Ballarat floods. I haven’t had a look at the 2010 but given the river is very close, I would say it is not in the best locations. With Ballarat flooding 2 years in a row, one must consider how good it is as a location.

        Now about your property, I would have a look at the price as it seems you are paying way too much… as you can buy 4 bedroom 2 bathroom and double garage for $290,000… see this link … so therefore it would appear that the property company selling you this house has put a hefty commission on top for themselves.

        Thirdly, in relation to to the NRAS side of it… I think my Blog clearly states my thoughts on NRAS.

        I do think you have more concerns here than just NRAS though…

        Cheers Todd


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