VIC A residential map of Melbourne CBD and its different precincts

Discussion in 'Where to Buy' started by olofmeister, 6th Apr, 2020.

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  1. olofmeister

    olofmeister Active Member

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    Hello everyone,
    Due to the coronavirus I have had some time off work to put together a map of Melbourne for those who are interested in buying into the city. I have numbered the precincts and offered my opinions on them below. The other image is new supply in Melbourne (may be a little outdated) from the city council's interactive website.

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    About Me

    A single guy, late 20s, ex-postgrad, working in a professional field. I like houses, architecture (gotta put that arts degree to use) and finance. The CBD suits my lifestyle and I find that walking to the office is the best thing you can do. Obviously I don't have a lot of experience investing in property, but what I do have is pretty comprehensive knowledge of the CBD market, possibly only second to agents. This is because I am also an owner occupier here. I'm not here to sell you anything. What I present to you are only my opinions; you should always have more than one source of them, but I will be happy to assist you with any inquiries especially as regards location and build quality. Sorry, I can't help you with the Docklands because like most normal people I do not go there for fun.

    About The Map
    It's taken from google. It's the best I could find. The two thick lines represent the Swanston St axis and Bourke St axis. If you are not familiar I suggest opening up the original map in google concurrently. Some of the zones may not be 100% accurate. If you think I made an error please let me know.

    Should I invest?
    I can't really help you with that question. The majority of people will say 'no' but there are good bargains in any suburb, and/or perhaps you are looking to be an owner occupier and save an hour a day commuting (I think it's worth it tbh), but you wouldn't mind making some capital gains on the side. I can only tell you where and what kind of apartment would make a sensible buy, right down to the precise building itself.

    1. Paris End

    Rent Potential: High

    New Supply: Low

    Melbourne’s ‘Paris End’ is the most prestigious residential quarter of the city. Most apartments here are conversions from the 90s to the 2000s undertaken with the blessing of the City Council’s Postcode 3000 scheme. Floorplans are typically generous, loft style is common, land component is high, and blocks are usually low-rise and boutique due to regulations. New luxury towers have been built, or are being built, on Spring Street overlooking Treasury Gardens. I do not consider them a great investment because the owners corp. tends to be high, but the views are never to be built out. Even established units are expensive; ‘Shocko House’ and ‘Cavendish House’ are some beautiful examples of old world architecture. Stroll down to the best restaurants and Gucci. My café pick is Postal Hall underneath the classy ‘Hero’ apartments building. Mostly quiet at night. Good for owner-occupiers who have downsized and enjoy the theatre.

    2. Flinders Quarter

    Rent Potential: Medium

    New Supply: Almost non-existent

    If you like laneways and cafés, this should be your place. Busy with tourists/airbnbers and very convenient location; tends to attract European types who don’t stay for long and some local artists/architects/downsizers. Flinders Lane and the southern end of Little Collins tend to be the residential areas. As with the Paris End, most apartments are bank and warehouse conversions. Some very old examples, generous floorplans, low-rise, high land component. The only obvious disadvantage is that views are seldom spectacular. A new train station is being built here but the noise is only temporary. You won’t find many listings here because there aren’t many to go around in the first place. Price can be average to expensive, notable blocks include ‘Leicester House’ and ‘The Excelsior’. Also see Flinders Lane around the famous Brunetti café for several heritage listed examples. If you are inspecting a property, you must go to Brunetti on the way to get a real feel for the area.

    3. Financial Hub

    Rent Potential: Medium

    New Supply: Medium

    A mix of old and newer apartments, but generally there are not that many new blocks coming up. Notable developments are ‘Collins Arch’, which is expensive to buy into but looks impressive, and ‘Collins House’ aka 466 Collins, a superslim skyscraper with better than usual fittings. You will find that most blocks here are mid to high rise, which are not out of place in the financial district after all. Decent selection of amenities and food, but you’ll have to walk a bit for supermarkets and the train. There isn’t a great deal to say here, it’s mostly offices, and it’s dead at night. Go for something with Yarra views is my tip.

    4. West End – Spencer Street

    Rent Potential: Medium

    New Supply: High

    There has been a surge of new developments along the western end of Spencer Street, including the ‘Premier Tower’ and ‘Ritz Carlton Residences’, the latter of which is world famous for luxury. For some reason, international students like living here, so demand is always high. Developments are targeted at investors; unit sizes are smaller than usual and very dense – see the massive ‘West Side Place’ and ‘Melbourne Grand’ for instance. Prices hit the sweet spot. There are supermarkets at Southern Cross and cheap eats scattered around, including Korean and Indian along King Street. As you might expect, there are also nightclubs and backpackers. An exciting place to live…and let live.

    5. Brady End

    Rent Potential: Medium

    New Supply: Very High

    I half-jokingly call this the Brady End because the Brady Group loves to develop new supertowers in this region. For examples of what’s available here, let me just redirect you to the Brady Residential website. Brady builds…boxes. With big windows. And many, many floors. Not very generous floorplans, but good amenities. Very convenient and popular with students. Prices are generally affordable. With Melbourne Central at your doorstep shopping for anything is a breeze. Lots of cheap Asian food around, brunch spots and bubble tea stores. Personally, I like the Malaysian place Mamak and the café Little Avenue des Italiens. Activity at all times, but not particularly noisy. Check out the under construction ‘380 Lonsdale’, the website is impressive.

    The white box is Hardware Lane. Here you can find low-rise warehouse conversions and even a few terraced houses. Probably the absolute busiest part of the city at night.

    6. RMIT

    Rent Potential: High

    New Supply: Very High

    Welcome to China. Because this is next to RMIT and close to Melb Uni, this is where the greatest concentration of international students can be found. Needless to say, Asian eateries abound. Most are very tasty and affordable, if that is your thing. The coffee here mostly sucks apart from Market Lane coffee and the one at the state library. The Queen Vic Market, MC and QV are next door. Rent yields seem to be slightly higher than usual. Always busy at all times, but as a rule the Chinese don’t make a great deal of noise. New supply here is incredible – many supertall towers packed into a few blocks. ‘Avant’, ‘Empire’, ‘Victoria 1’, ‘Vision’, ‘Aurora’ towers – these are just the new ones. Investor friendly pricing, good views, tiny floor plans. Yes, the demand here is the highest in all of the CBD, but so is the supply. Caveat emptor…

    7. Northern End

    Rent Potential: Medium

    New Supply: Medium

    A mix of new and older housing. Most blocks here are already established, constructed in the modern style but with more generous layouts and higher land components. You won’t find a great deal of supertall towers here apart from ‘Abode 318’, a PDG developed tower with better fittings than most. I think that the larger layouts here make units slightly more expensive than the average, but on a per sqm basis it’s nothing remarkable. You’ll have to travel down south for amenities, but you’re right next to Chinatown for food. Chinese food is always a good option. International students like the proximity to Melb Uni. For low rise boutique blocks, ‘The Sefton’ comes to mind. It’s somewhat out of place with its surroundings, but check out the penthouse, which is elegant and fetched a nice price recently.

    8. Southbank

    Rent Potential: High

    New Supply: Very High

    A suburb by itself, Southbank has two markets: luxury and investor grade. There is some overlap, but as a rule of the thumb, the closer you are to St Kilda Road and the Yarra, the better the property. Now, I don’t really have to point out the Eureka Tower or Freshwater Place, they are world class landmarks if you want a trophy apartment. For the rest of us ordinary people, Central Equity offers off the plan blocks with good amenities and their design has somewhat improved since their early days. However, the floorplans are still small by comparison and the prices higher than average. City Road is host to massive development and there is every chance that even if you buy an apartment with a view, that view may be lost in the not too distant future. It’s better to enjoy all that open space next to the Arts Centre and the Tan track. I also want to point out the shortcomings of new developments. I have personally stayed in very large 2BR residential apartments in both the Eureka Tower and ‘The Melburnian’ (overlooking St Kilda Rd) and found them to be truly luxurious with quality builds and fittings. The new ‘Australia 108’, although looking similarly opulent, is actually more downmarket than the previous two developments. Inspect if you like, but I wasn’t too impressed with the cutting of corners.
     
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  2. # 1

    # 1 Well-Known Member

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    Nice. I once lived in Lt Collins St up Spencer St end and there used to be a seedy pub next to the Savoy hotel where drunks would sleep in the back laneway but now it's a huge Multiplex development. This was before Southern Cross was built and they had extended Collins St. Crown's temp casino opened up in this area about 1994. Southbank and City Rd was full of crappy dogboxes built by Central Equity and I'm happy I didn't buy there.
     
  3. housechopper2

    housechopper2 Well-Known Member

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    Cool maps. One question: where are you planning to buy?
     
  4. olofmeister

    olofmeister Active Member

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    As purely investment? Somewhere a bit older, closer to the Paris End...
     
  5. TMNT

    TMNT Well-Known Member

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    I woke up in that exact street after a big night out many years ago!

    Lucky I wasn't arrested
     
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  6. Potm

    Potm New Member

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    Thanks for the information. Very helpful.

    I’m interested in the apartments above QV at 22-24 Jane Bell lane. Do you have any opinions on the building and quality there?
     
  7. Omnidragon

    Omnidragon Well-Known Member

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    Have 2 apartments in CBD. Pretty hard to make money buying this stuff must say. Massive supply, always newer and better with more facilities. Can’t sell to foreigners on resell
     
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  8. olofmeister

    olofmeister Active Member

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    i vaguely remember a night out with a uni mate of mine and he was an international from malaysia living in a 3BR in the QV building and the address you supplied, which i am familiar with, was nothing like where i crashed.

    was a bit confuzzled at first until I found this:
    QV Melbourne

    turns out there are 2 separate apartment buildings, built by different architects, in the same complex. i was at QV2 aka 300 swanston street. i think the finishes were of a good standard, views were superb and the layout was open plan and kinda odd. imho you would be better off buying into the low-rise QV2 as opposed to the 40 storey QV1 (jane bell lane).
     
  9. olofmeister

    olofmeister Active Member

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    i do not doubt your challenges for a moment but i have a mental list of buildings that have seen good yields AND capital growth over the last decade. for instance, 422 collins street can fetch you a 5% yield and capital growth has been about 4%. that is comparable to a decently managed fund. however their body corp is on the slightly higher side. also see 118 russell street.
     
  10. Potm

    Potm New Member

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    Thanks, the QV2 apartments are a lot rarer to go on sale. I’ve been eying the building ever since visiting a friend there back in uni a long time ago. It’s the perfect location for me.

    Do you have any suggestions of other buildings I should consider. Owner occupier, either 1 or 2 bedrooms. Looking at the current situation, I think there will be a lot more supply than demand as tourists and international students have left the market. I see rents have fallen a lot already but prices haven’t updated yet. I’ve got a secure job and looking to get myself a bargain in a good building that doesn’t have any issues and doesn’t charge an arm and a leg for body corp.
     
  11. Omnidragon

    Omnidragon Well-Known Member

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    Can you show me where the cap growth is 4%? I’m pretty surprised. I don’t doubt your rent for a bit.

    I’ve had friends lose money on Golden Age’s skinny development pre completion, they were trying to sell the OTP right s but couldn’t even for a 10% loss. It’s actually just opposite the 422 you talk about. My cousin lost money on Upper West Side, built by Far East. He bought OTP.

    In one of my art deco apartments on Little Collins St I almost bought a second one 8 years ago. Guy who overbid ended up reselling for a 10% loss a few years later.

    Re 118 I have freehold around there so know the area very well.
     
  12. olofmeister

    olofmeister Active Member

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    yes, to be blunt, it's built by hickory. wouldn't touch anything by them with a 10 foot pole.
     
  13. Bigred100

    Bigred100 New Member

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    The building companies are all losing money due to hyper competition to win these jobs.

    Most are rushed and poorly built, anything between 2000-2014 is likely covered in flammable cladding

    Mirvac and Lend Lease being the exception

    Steel fittings are rarely connected to design specifications and can be very loud with movement

    There are more buildings under construction than ever before, plus the entire CBD is requiring infrastructure upgrades to cope, so over the next 4 years every street will be jackhammered and concrete cut to increases services. This activity often has to occur at night.

    Plus Melbourne metro works are 24/7

    The city is too loud for most people and if a new development is going up next door you will likely lose your Tennants who won't want to put up with noise.


    All IMHO
     
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  14. Bigred100

    Bigred100 New Member

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    Regency towers is a well built building next to the Marriot and close to Carlton gardens.

    It has a lot of old people in it (covid-19 could wipe some out) has had the new Wesley developement and a Brady hotel development just go up next to it, so some veiws have been lost and it's been a bit of a warzone of construction for 3 years, could be worth a look as most of the directly ajoining construction will be finished within a couple of months and the area will look fantastic in a couple of years when trees grow back.
     
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  15. kaibo

    kaibo Well-Known Member

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    For me Northern end for sure to live. Best to have unblockable views to Carlton gardens or parliament house that will never be blocked out. Traffic not as bad and easier to get out to Richmond or Carlton for food as well.

    Older style there build late 90's is bigger and lower density and no stackers. Lower density to an extent where body corps are still manageable so I think that strikes a good balance

    This seems OK (if i had to live in the city I would choose something like this) but would be really hot during the summer
    https://www.realestate.com.au/property-apartment-vic-melbourne-132943942
     
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  16. olofmeister

    olofmeister Active Member

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    I have been looking around for a bit and most listings are pretty crap, but this came up today...
    https://www.realestate.com.au/property-apartment-vic-melbourne-133343850

    Lousy view (kinda like my current unit), but ticks every other box. A significant building that won't fall down.

    Agents got the address wrong, it's 23/27 Flinders Lane (yeah, unbelievable...). 80sqm for 625k asking. I believe it is a worthwhile deal in the top end of town. Ordinarily, I would not advertise it but make a strong timed offer myself, but my benefactors are out of cash atm so someone else can go for it...

    Only thing is that I don't know the body corp and sinking fund numbers so if someone can share that with me it'll be appreciated
     
  17. ATANG

    ATANG Well-Known Member

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    51/140 Flinders Street, Melbourne, Vic 3000
    https://www.realestate.com.au/property-apartment-vic-melbourne-133475858

    I would pick this one if same price range - unblockable view!
     
  18. olofmeister

    olofmeister Active Member

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    I thought that would be good too but afaik it's been on the market for some time. My guess is that the master bedroom must be very noisy (it's next to a busy intersection) and really the second bedroom...is a tiny study...with no wall...so it's not even a room...

    i would personally not want to call in someone to install a sliding door. they shouldn't have put in full length glass windows in the bedroom too, if it was double brick and super well insulated I would consider...this is me thinking as an owner occupier

    still, it's not a bad property
     
  19. Tony3008

    Tony3008 Well-Known Member

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    With all that glass, I wonder what it’s like in the winter? That’s why I moved: my old apartment had a bedroom with more glass than carpet and even though it was warm by the thermometer, it felt chilly all winter.
     
  20. SydneytoMelbourne

    SydneytoMelbourne Active Member

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    Agree that for the short-medium term that view won't be blocked, but I suspect in the longer term it will become cost efficient to build over the top of the tracks leading into flinders. It pops up every few years in the paper - I suspect it won't be cost effective for some time though.

    Would be a long way a way but if you're going to hold for 20-30 years you might get some elements blocked. I'd feel much more comfortable in front of a river or a park than a built area.