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1 Beder - is it worth it

Discussion in 'General Property Chat' started by buckleysg, 9th Nov, 2015.

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  1. buckleysg

    buckleysg Member

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    Hi,

    Have seen a few one bedders advertised in the Avondale Heights etc (north west of Melbourne). Are one bedders a good intro to property investing?

    Thanks
     
  2. D.T.

    D.T. Adelaide Property Manager Business Member

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    I wouldn't personally.
    What do you plan to do with it? Sit around and wait for it to go up in value?
     
  3. Xenia

    Xenia Adelaide Property Manager Business Member

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    This is not stock that is in high demand if you need to sell. Buy low sell low rent low.
     
  4. mja

    mja Well-Known Member

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    It really restricts your pool of available tenants and if you need to sell, potential buyers who want that sort of property.
     
  5. JenW

    JenW Well-Known Member

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    No. We started off with two single bed units, and we were fortunate to sell them for prices that still haven't been matched in that suburb. Once we realised that they weren't going anywhere in terms of capital gains, we got rid of them and bought two bedroom apartments instead.
     
  6. Casteller

    Casteller Well-Known Member

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    1 Bed apartments were the best investments I ever made, I just bought another one this month. I think they are an excellent choice if in the right area (inner cities), there is plenty of rental demand.
    My worst buys in terms of performance and ongoing costs were houses with 3 bedrooms.
     
  7. WestOz

    WestOz Well-Known Member

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    If it's close to all conveniences, priced well compared to larger you could get a little further out, strata fees aren't ridiculous, all you can afford to get you started, reasonable rent a single can afford that will at least cover your loan, a long hold, why not, it's a personal thing really.

    Plenty of singles out there that can't stand sharing a fridge, toilet etc with others, don't need a big place to keep clean (I'm one of them), plenty of couples not ready or interested in having kids, like a granny flat small is easy/low maintenance.
     
  8. Michael_X

    Michael_X Mortgage Broker Business Member

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    I would say a simple rule is buildings depreciate (hence the depreciation reports) and land appreciates.

    One bedders are usually high in building content so may be good cashflow but under perform from capital growth perspective.

    If it's well located and high in land content you could make a case for them but generally not something I advocate.

    Cheers,
    Michael
     
  9. Tony Fleming

    Tony Fleming Well-Known Member Business Member

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    I've got two one bedrooms units I've never had a issue with finding tenants. One has never been vacant and the other seems to rent for a year or so and then the tenant leaves. Mainly single Dad's or young couples that just need time to get back on track and move on to bigger units or houses I guess. As Westoz said its a numbers game.
     
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  10. The Y-man

    The Y-man Moderator Staff Member

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    2 questions here.

    Are 1BR a good intro? - IMHO yes, we started there, and got some good capital gains and/or decent cashflow in comparison to bigger properties.

    1BR in Avon-Heights? - not familiar with market, but probably not. Go closer in - Fitzroy, Collingwood, Hawthorn, Carlton, St Kilda, maybe Footscray. Not Essendon, Geelong, or Melbourne (CBD)

    The Y-man
     
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  11. JacM

    JacM VIC Buyer's Agent Business Member

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    Are one bedders good... depends what you want to do with them. As buy and hold and rent out, they are a very stable commodity due to life circumstance of the people seeking to reside in them. (People that have lost patience with living with others and just want their own space, people exiting a marriage with little likelihood of every being in a position to buy again, and people that are a bit older that just want something simple and the right to have a pet cat.)

    Regardless of size of dwelling, I'd steer well clear of anything that chews up too many weeks worth of rent if the oven needs replacing.
     
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  12. cdchi1

    cdchi1 Well-Known Member

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    If its an area where singles tend to live, go for it.

    If you'd bought a one bedder in Elwood for example, you definitely wouldn't be unhappy with the returns made. Or in Carlton where uni students are abundant.

    Avondale Heights though? Not so sure about that for singles.
     
  13. 7smurfs

    7smurfs Member

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    1BR = not so great CG, easiest to rent/find tenants however

    Does well if you want to start building equity and have a low deposit. Look at inner city where there isn't so much new development.
     
  14. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    By far the easiest way to determine what the best type of property for a particular area might be, is to simply ask a property manager.

    Have a chat with a couple of property managers and simply ask, "What type of property rents really easily around here for the best return?"

    It's in the property managers interests to give you an honest answer as it will make their job easier if you've bought the right type of property. Unlike sales agents they're not going to convince you to buy something that they're trying to sell.
     
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  15. Ozzie in Texas

    Ozzie in Texas Well-Known Member

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    I think it truly depends upon location. There was a time when 1BR in locations like Kings Cross, Darlinghurst and Alexandria were selling at a huge discount to the rest of Sydney. In those situations / locations, investing in a 1BR, IMO, makes sense.

    The numbers have to support the argument.

    Is it the norm for its location - and is there rental demand for this kind of property in its location. Does ROI make sense comparatively to other choices.
     
  16. WestOz

    WestOz Well-Known Member

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    Hindsight's a frustrating beast, if only....
     
  17. sash

    sash Well-Known Member

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    1 brm unit in Dulwich Hill bought for 95k...now worth 450k.

    In Inner city locations they are gold.
     
  18. WestOz

    WestOz Well-Known Member

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    yea keep rub'n the salt in MF
     
  19. dabbler

    dabbler Well-Known Member

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    Even in the outer burbs they don't seem that bad in Sydney and many older ones have very similar area, rents also the same in the area I looked at or very very close.