FAQ

The Defence Housing Australia is a Commonwealth Government Business Enterprise, established under the Defence Housing Australia Act 1987. The primary function of DHA Australia is to provide accommodation solutions and property management services to members of the Defence Forces and their families. New acquisitions are financed by the sales revenue generated from the Sale and Leaseback Program. Out of a current inventory of approximately 19,000 houses over 10,000 are leased from property investors.

The Defence Housing Australia Sale and Leaseback Program has evolved to meet the demands of investors who are seeking a safer haven for their investment funds with more certainty, security and excellence in property management. We rely heavily on referral business from existing investors many of whom own more than one property.

The Benefits of purchasing a DHA property

Since 1996, DHA (Defence Housing Australia) has been playing an increasingly prominent role in the residential property investment industry. Their market edge is derived from the certainty surrounding the rent streams with no gaps in rent between tenancies, and no nasty surprises from unexpected maintenance costs, tenant bad debts or tenant damage during the term of the lease. �Unlike conventional residential property investment, DHA (Defence Housing Australia) can offer the security of a long term lease and this is more attractive not only to investors but also to financial institutions providing loan finance.

Depending on your individual circumstances, if you borrow money to invest, the cost of financing your investment should be tax deductible. Other items may also be tax deductible, such as capital works deductions (special building write off) on eligible construction expenditure, management costs, and depreciation of fixtures and fittings.

For full information on current taxation provisions, it is recommended that you obtain your own independent expert taxation advice.

Click here to visit the Australia Taxation web site

We offer a diverse range of properties including three and four bedroom houses, two and three bedroom townhouses, apartments and courtyard homes.

Most have been owned by a private investor like yourself who is now wishing to sell their investment during the unique DHA lease period.

Most properties are sold with standard DHA inclusions, such as carpets, ceramic tiles, window furnishings, landscaping and fencing. Standards of construction, fixtures and fittings come under close quality control monitoring.

What does DHA maintenance cover?

Most DHA  (Defence Housing Australia) properties that we sell have a monthly management fee of 16.5% (incl. GST) of the gross rental income for houses, or 12-14% (incl. GST) for apartments, units, and most townhouses if a body corporate is responsible for exterior maintenance.

This monthly fee covers the cost of managing the property and most day-to-day maintenance (including repair or replacement of fixed appliances should they fail).

The key benefit is guaranteed rent for the life of the lease, even if the property is empty.   DHA are responsible for the “day to day” type maintenance, it’s probably easier if I tell you what they don't look after, that is :  

1. Large landscaping works ie. removal of a large tree.

2. Replacement of boundary fencing (repair and maintenance of boundary fencing is covered)

3. Any insurable damage.  

Throughout the lease term, DHA are responsible for organising and covering the cost of most non-structural repair and maintenance, including the replacement of fixed appliances as needed. The owner does retain some obligations, but your responsibilities are significantly reduced compared to conventional residential property investment.   They maintain the property, with the exception of fair wear and tear, for items such as: • walls and ceilings • doors and windows, including security screens • window coverings (e.g. blinds and curtains) • floor coverings (e.g. carpet and tiles) • lights, light fittings, power points and switches • built-in appliances (e.g. stove, air-conditioning and hot water system) • wet areas (e.g. plugs, tiles, vanity units, shower screens and towel rails) • gutters, downpipes, gates, garage doors, letterbox and clothes line, and • general upkeep of grounds and gardens (e.g. plants and mulch). In most cases, at the end of the lease, DHA will also replace the carpet and vinyl, re-polish timber floors and repaint the property inside and out.

(ref. Lease clause 5 – 'Management/Maintenance')

In our opinion, DHA's fee structure is very favourable to an investor. The management fee is deducted each month from your rent allowing you to spread the cost of maintenance over the total lease period and claim a tax deduction for these costs from commencement of the lease.

In most cases you will be responsible for property insurance, public liability, local government rates, taxes and charges, body corporate fees (where applicable), and any other usual investment property expenses not covered under the DHA (Defence Housing Australia) lease agreement. You will not however be responsible for excess water charges.

If you wish, DHA (Defence Housing Australia) in their role as the property managers, can pay these expenses on your behalf and deduct them from your rental income (ref. Lease clause 12 – 'Management Function').  This will need to organised directly with Defence Housing Australia after we have completed the sale.

In most cases the rent will be already set at the time of sale. Each calendar year the rental will be reviewed and adjusted on your following 1st January rental payment, according to market valuation, by an independent licensed property valuer.

As DHA's rents are reviewed annually, they are subject to cyclical movements – up and down, however they tend to smooth out over the length of the lease.

(ref. Lease clause 10 – 'Rent Review').

As some lease conditions can very please refer to the lease features page for the individual property you are interested in.

In most cases the net rental (minus management fee and any other bills you have authorised us to pay i.e. rates) will be payed monthly in advance into a nominated bank account. You will receive 12 rental statements per year for each calendar month and also a end of financial year statement.

If you are a permanent resident of Australia, you can purchase a DHA property. If you don't hold Australian residency or Australian citizenship, depending on your personal circumstances, you may need prior approval from the Australian Government's Foreign Investment Review Board.

Again, we recommend you seek independent advice on issues surrounding residential status.

Click here to visit the Foreign Investment Review Board website.

What  will happen when the lease expires

Upon lease expiry, you may choose to move into the property yourself, re-let the property, sell it, or even help your children with a home of their own.

>In most cases, at the end of an original 6-year lease, DHA (Defence Housing Australia) will ensure that your property is clean, and the gardens neat and tidy. DHA  (Defence Housing Australia) will also re-paint the property inside.

>In most cases, at the end of an original 9-year lease, DHA will also replace the carpet and vinyl, re-polish timber floors and repaint the property inside and out, (except where a body corporate responsibility).

How does the maintenance work?

DHA's role is to provide quality housing for members of Australia's Defence Forces ie. Army Housing, Navy Housing & Airforce Housing. They therefore have a vested interest in ensuring that the quality of our houses and maintenance is of the highest standard.

> DHA takes care of the day-to-day maintenance (including repair or replacement of fixed appliances should they fail). DHA organise the work, ensure its quality, and liaise with the tenants. Most importantly, if organised with DHA  (Defence Housing Australia) they can organise to pay the bill as part of our management service.

> The Defence Housing Australia also underwrites any tenant damage (subject to fair wear and tear).

Since 1996, DHA  (Defence Housing Australia) has been playing an increasingly prominent role in the residential property investment industry. Our market edge is derived from the certainty surrounding the rent streams with no gaps in rent between tenancies, and no nasty surprises from unexpected maintenance costs, tenant bad debts or tenant damage during the term of the lease.

Unlike conventional residential property investment, DHA  (Defence Housing Australia) can offer the security of a long term lease and this is more attractive not only to investors but also to financial institutions providing loan finance.

 

Information Privacy Act 2009 (IPS Act) that sets out how personal information must be collected and managed.

Changes to this Privacy Policy: Defence Property Investments reserves the right to make amendments to this Privacy Policy at any time, but in line with relevant legislation.

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Email : Liz@defencepropertiescom.au

 

** we dont get paid for just turning up, we will work hard for you �to sell your property or to find you a suitable property.  We are an �independent Real Estate Agency and not a Commonwealth �government �entity. DPI is not affiliated to the Department of Defence or �Defence �Housing Australia.**