EPISODE 199 - A Follow Up to Episode #194 (Part 2)

The SDA HOUSING Podcast

Today we have Brad Fuller, one of our SDA friends who has been working as an SDA Provider for the past 4 years. Being based on the Gold Coast, near us in Brisbane, we have become good business acquaintances over the past few years, because our business ethics and philosophies within the SDA space are very much aligned.
Minh invites Brad onto the show, first and foremost, to introduce him to our listeners and allow Brad an opportunity to share his thoughts on NDIS 2.0, more so in relation to IL and the Robust topics.
But more importantly, this episode corrects Minh's mistaken opinion on the concept dual key robust design, to be used as IL, and later on ROBUST, if IL is phased out. Minh had previously discussed with Debbie about the dual key robust design as a possible fall back position, but now have realised, after chatting to Brad, that Bruce Bromley was correct in his comments about it not being a good idea.
“MY BAD!" says Minh, and he is owning up to his error of the floor plan concept raised as an idea for episodes 194 & 196.
Brad talks about the topic of 'Restrictive Practices' caveat imposed by the Commission, and reinforces on the brief comments by Bruce Bromley (from which Episode 196 was based) ended up being correct. Brad agrees with Bruce in that it doesn't allow for this house design to be future proofed in the way that Minh spoke about in the earlier episodes. By bringing on Brad to discuss this matter, we have cleared up this error on Minh's part, and now give more clarity on options for investors. Hence, they conclude that it's probably best to not build an IL in 2024, but instead build a normal ROBUST house instead (for IL purposes).
#Thanks #BruceBromley
Anyway, this discussion between Brad and Minh becomes an open conversation about alternatives to just building an IL house in this current climate of uncertainty, and Brad explains to our listeners (after chatting to Minh in great detail behind the scenes) the paths moving forwards for investors already locked in and committed to the land purchase which was originally intended for IL.
In summary, the options for incoming IL investors are as follows:
1. If your block is big enough, upgrade the build design to be HPS (assuming cost is okay)
2. If your block is not big enough (ie wider frontage) consider a ROBUST design, assuming the block of land is situated in an ideal position away from nearby houses, and close to hospitals with disability services
3. If your block is not suitable to robust, your choice is to continue with the build as an IL and pray that there is little impact on future changes to the IL category int the short term.
4. If options 1, 2, & 3 above are not an option, then try and 'sell the block' back onto the open market if you don't feel comfortable with the SDA market conditions, and restart again with a build in a different location.
5. Follow through with the IL build, get your IL incomes over the next few years, and reassess in 2028/29 if the option is to sell if off, or rent it back to the normal residential market tenants, post returns received circa $750,000 after 5 years (before costs)
We think this idea of building Robust instead of Improved Liveability is the best path moving forwards to future proof the investment property in SDA, if HPS is not viable.
Remember, please do your due diligence on the data research, assess the location, the amenities, the participant numbers, and the quality of the design by speaking to allied health professionals and nearby SDA and SIL providers

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