Studio 9 Richmond offering buyers a 10% annual return on deposits while awaiting construction
Lend Lease is offering a 10% interest rate on purchase deposits for August buyers at its Studio 9 development in Richmond.
The rate is almost twice the best cash rate on offer by banks.
The current apartment offerings are priced from about $455,000 to $1.85 million with the stage one apartments due for completion by late 2013 to early 2014.
A buyer who signs a contract to buy a $455,000 one-bedroom apartment with a $45,500 deposit would by the start of 2014 have earned approximately $6,800 while the deposit was accruing interest.
A two-bedroom, one-bathroom apartment at $655,000 with a $65,500 deposit will earn the buyer approximately $9,800 in interest.
A two-bedroom, two-bathroom apartment at $735,000 with a deposit of $73,500 would earn approximately $11,000 in interest.
Previously at Studio 9, buyers were offered interest rates on their deposits in line with cash rates offered by banks.
Typically interest from deposits would go to the developer. A Lend Lease spokesperson says the move does happen occasionally.
"From time to time, we offer the interest on the deposit at whatever the normal bank rates are that are received in our solicitors trust account."
The current deal ends on August 30, with no caps on buyer numbers.
The Studio 9 development is being built on the former Channel 9 studios on Bendigo Street in Richmond.
The project consists of four stages of townhouses and apartments.
The master-planned community will pay homage to its iconic industrial and broadcast past. The site is a former piano factory, then Heinz canning factory, then broadcast studio.
Lend Lease says once contracts are unconditionally exchanged the purchaser is unable to withdraw from the contract for sale.
REIV’s Robert Larocca says many off-the-plan buyers don't expect any interest on their deposit.
“I think it’s an innovative reaction. It’s something that will help encourage a few more buyers that are sitting on the edge.”
“Off-the-plan buyers generally wouldn’t expect interest, it’s not standard.
"One of the issues for purchasers buying off the plan is they're worried about how long it it will take. They usually won’t earn any interest on their deposit . This marketing would be dealing with that concern."
The Mark at Sydney's Central Park
The best of everything at Portside Wharf
Meanwhile, Mike Quigley, boss of the federal government's National Broadband Network, has also sold his Mosman mansion recently at $3,555,000. It represented a loss on the $3.6 million paid in 2007.