Broadmeadows Property...

Hey guys I was chatting on here about a property in broadmeadows; please see below:

11 Beulah Street, Broadmeadows, Vic 3047 - View Sold History & Research Property Values - realestate.com.au

• 3 bedroom, 1 bath 1 car spot, on 370 subdivided sqm block.

I am in negotiations with the seller, we are at 280K atm, but I'm thinking this may be too high

However there few issues with the property:

• Some structural work is required, restumping needed, contractor quoted 2K
• And some painting inside and out and a general tidy up 5-6K
• Subdivided block already only 370 sqm
• I spoke to the council and they said could fit 2 small townhouses but usually the developers won't touch and prefer the large blocks

Questions are do you think this is a good buy with regards to the money that need to be spent?
Do you think Broadmeadows will follow the surrounding areas in capital growth?
Is this a development grade property.

Any help would be much appreciated just don't want to shoot myself in the foot when there could be better opportunities out there. Cheers.

 

Hi, I don't think you will enjoy any decent growth since its already subdivided. I would leave it alone

 

Depends what you want it for. It's pretty much one of the cheapest things around there and looking at the rental market, I'd make an uneducated guess that it would get a bit over 4% gross yield which is pretty decent for melb houses.

It's moved quite a bit, but driving around and looking at crime reports gives you an idea of how rough that area is. I don't see the 700k+ buyers in Glenroy rushing across any time soon, others may think otherwise. The highest selling houses (500k+) are generally development sites. So on that...

By land cost ($800/sqm), its not great. There's no shortage of sites around that price (or less), many of which are better located to amenities. Eg:
13 Gosford Crescent, Broadmeadows, Vic 3047 - Property Details

 

Ok thanks mate, I have been looking at other areas and think that this may be

Ok thanks mate, yes I was thinking the same. But can't help to think that Broadmedows could be on the move.

 

Ok mate thanks for the information. I would've said the same thing about some less desirable suburbs of Sydney too 10 years ago. But now everything has skyrocketed.
Also being so close to the city may see some good growth if Broady ever looses that bad area stigma.

So what would you say? should I negotiate the price some more? Or walk away from this one, as it's not worth it?

 

I bought a property there 3 years ago. Great capital gain.

HOWEVER

One tenant stopped paying rent after 3 months and we needed to call police to kick him out after lots of hassle. The house got broken into multiple times and we had intruder stayed in the house and damaged the property when it's vacant.


Long story short,
Nightmare investment for me. Hope for a better luck for you.

 

This property is only desirable because it has a sub-300k price tag. If it goes up, it looses its key point of interest as there are a fair few battle-axed properties in the low 300's.

As a landlord, a tenant, or an owner occupier i would rather spend the 10% extra and get something like this: 1/1 Alexander Court, Broadmeadows, Vic 3047 - Property Details. With the number of development sites in the area, there is no shortage of supply for such properties.

Melbourne is a very different market to Sydney. Sydney has a huge existing constraint on detached houses and far less are being built. Around Broadmeadows alone you have Dallas, Meadow Heights, Campbelfield, West Meadows, and even Jacana below with houses on decent blocks selling under 500k. There is still a lot of affordable options for people here, so i dont see people rushing for one of Melbourne's highest crime suburbs any time soon.

 

I agree that its on its way up, but only for houses on 600m+ blocks. Otherwise your competing with brand new townhouses for tenants and the rent would be the same. If you want to buy in Broady with under 350k, but a new townhouse. Value will still increase either way but it will be slower than a full sized block and the townhouses.

 

So what kind of price do you think this proposal may be worth then to make it seem worth my while to purchase. Or do you think just leave it alone altogether? Due to the new town houses coming along and bad areas in general?

i was looking in other areas such as Geelong and surrounding areas, but this property came up and I guess my eyes lit up haha.

Can you still buy the 3 bedroom town houses for that price in broadmedows. The ones I seen were asking 380-400k? That does makes sense to buy brand new and get the depreciation.

Yes I can see what you mean by the surrounding suburbs and the the comparison to Sydney. I'm from Sydney so not too familiar with the crime rate.

 

Ok mate thanks I didn't think of it that way. As I said I think my eyes lit up when I seen this one and the price tag got me interested. What do you think would be a good price to pay for this one to make it a decent investment. Ie sell for a profit in 2-3 years?

 

Have a look at jacana- not sure if they are within budget but worth a look.

 

I don't think you can rely on selling for profit on already divided blocks. Stamp duty, selling costs etc will eat it up.
I think you should look a bit harder, I think you can find a better deal, on something without the structural issues. I wouldn't bother with regionals, I think you ron the right track just look for something on a bigger block or if subdivided a new build, you may have to increase the radius where your looking a bit

 

We are near enough the peak of market. By the time you factor stamp duty, holding cost, and selling agent fees, you will be hard pressed to find anywhere that returns a profit within the next few years. If that's your timeframe then for the downside risk i would just wait it out and get disciplined with your weekly savings.

 

I've been on the ground there as recently as last week. Development sites doing well. I bid on a site in Gosford Crescent, which ended up going 10% over the vendors reserve. $445K for 600m site. Walking distance to station and shopping centre. I couldn't make the numbers work as a buy and hold (develop later) at 3.5% yield. Looking closely at some others, but no cigar yet.

Plenty of townhouses coming online over next 12 months. Agents say they are working their way through an oversupply of townhouses from 2015/6, 3 bedroom ones starting to move, but a lot of them are only 2 bedrooms.

In terms of straight IP houses (ie not deve sites or townies), most of these need a LOT of work, and I can't see the value here either, as area has already moved and yields lower than I like. Loving the proximity to the city and infrastructure, but deals not working for me.

 

@fols is that the one i shared in post #3?

Interesting to hear the agents consider there to be an oversupply

 

Sorry @JL1 I missed the link in your post. Yes, thats the one.

I was all in at $400K, but not $445K.

 

Thanks mate for the information. I just hate to think that in 18months time I will be looking on Domain and places like this are fetching up and over 400k.

Where abouts are you looking now ? I take it not broadmedows anymore

 

My goals would be to buy and hold for at least 5-6 years. But as you say it is a divided block. What do you think would be a good price on this one if I were to counter offer ?

I was in the process of using a BA until this place came along, who specialises in western Melbourne and Geelong. My plan is to buy and hold.

What type of areas would you say could be promising for that price range mate?

 

I think you need to hold 10 years plus to see any decent profit. Sell any sooner and you will regret it. I wouldn't buy it no matter what. Could cost you 100k to fix the issues

 

I suggest trying to pick something up in Frankston North. Median is 345k. Bargain, and full sized block