VIC Battle of the townhouses OTPs (Preston vs South Kingsville).

Looking to buy a PPR that will eventually become an IP. I’ve found two OTPs that look promising but hoping to get thoughts on which may be better to hold onto.

Option 1: Preston Place townhouses

https://m.realestate.com.au › projectPreston Place New Apartments at 22 Wood Street - realestate.com.au

Range between $949k - $1.1M for a 3-4 bed, 2-3 bath, 1-2 car.

I’ve never lived in or near Preston so unsure about the location, it’s right on the Darebin Creek at the back of Northland shopping centre.

Pros: Cheaper townhouses, Market, Public Transport, Gentrified, Diverse, one of Melbourne’s most liveable suburbs and has seen great capital growth, access to literally everything with Northland only a few mins away.

Cons: Smaller sized rooms across plans, No backyard in some plans (I have dogs and children so this is a factor), three storey house plans don’t have a powder room on the living/kitchen/dining level, traffic & travel to CBD is ~40mins.


Option 2: Newport Village townhouses

https://m.realestate.com.au › projectNewport Village New Apartments at 38 - 48 Blackshaws Road, South Kingsville


Range between $1.2M - $1.3M for 4bed, 3bath, 2 car + separate study

Literally had no idea this suburb South Kingsville existed, generally I steer clear of the outer West because of traffic to the CBD (Point Cook Rd & Westgate Bridge), however, Inner-West doesn’t seem to have the same issues.

Pros: Public Transport, Gentrified, Diverse, House sized townhouses with very generous rooms, excellent layouts and private courtyard, turnkey package with great inclusions, travel to CBD is only 10mins and the beach is nearby.

Cons: Walking access to cafés, groceries etc, lower capital growth (although I’d expect this to change considering prices in Newport/Yarraville and Spotswood), more expensive townhouses, industrial train repair line is on the far side of development (would this effect growth?).

I’ve been looking for similar sized established homes/townhouses as the South Kingsville townhouses around inner city and they’re out of my budget >$1.5M so I’m looking at OTPs unless something amazing pops up. What do people know about these areas and over time would South Kingsville be worth it? I love the layout and size. Also, does being near a beach add value or being in an established suburb become a better IP? Most townhouses I’ve seen recently are 3 bed, 2 bath, 1 car - so would a larger townhouses hold their value despite the railway repair facility?

Added plans for both OTPs to help see what I mean.

 

Hi Darsh

I might be wrong, but it sounds like you need to do a lot more research.

I like Preston, but the area of that development doesn't have great transport options and you would be on the border of Heidelberg West. Being next to the creek could be nice, but that spot can get busy on the weekend and I wouldn't want to be so close to Northland.

If you like Preston, it sounds like you could easily afford to buy a nice established property there that meets your requirements and you can do your research and buy the right property when you are ready.

I would also encourage you to compare Preston with Coburg. Personally, I prefer the transport in Coburg, as the train gets into the city quicker and they are not usually as busy as most of the other lines, but the trains don't come as often.

If you really want to buy OTP, that's your choice, but it is important you understand the risks.
My main concerns are:
- You are committing to a purchase and need to have finance ready to go, but you don't have any guarantee of when the property will be finished and you can move in.
- You don't get to see the finished product until it's too late to change your mind. This is not just relevant to the property you are purchasing, but the whole estate, the neighbours, etc. When buying a townhouse, your enjoyment of living there could easily be diminished by the wrong neighbours. While you can never guarantee who your neighbours will be, with an established property, you can at least do some research.
- Do you have surplus funds if the valuation comes back lower than the purchase price?
- Are the stamp duty savings really worth the uncertainty?

Living in a new townhouse might suit you perfectly, but the trade off is that the capital growth is likely to be disappointing. You are typically relying on the growth of the relatively small land component to offset the depreciating building component.

Good luck!

 

What's the reason for buying off the plan? Even buying a property that's 5 years old will often be much better value, and you can actually inspect the property before buying. Far less risky. But still feels very fresh and new. Lots of off the plan projects are having massive delays at the moment due to difficulty sourcing building materials.

 

I re-read your post twice and may have still missed it. Why do you want to live in these 2 areas and what are your needs with commuting to the CBD. Do you have family/friends because of who you want to live there (in which I get it)?

For that money, you'd get a very good house in Seabrook/Altona Meadows (within walking distance of the station). You'd get a very nice ex-display in Williams Landing. Laverton too, but probably not attractive to live in.

Parts of Point Cook, especially off Palmers Rd, don't have the traffic issues and the station's 15-20 min walk too.

If I was you, I'd not get hung up about a townhouse and that too an OTP townhouse. My opinion - your current two choices are not good.