ACT Canberra Property 2018

What do we think of the Flemington Rd precinct in Harrison/Franklin? I am looking to purchase 2 bedder in the area for around 350K.

Positives
- Light Rail (10 minutes to Civic)
- Schools

Negatives
- Federal govt redundancies
- Only units and apartments are available in this area

I am not investing for capital gain, I want to invest for yield and to be able to easily rent the properties.

Any other area you advise within Canberra which will suit my strategy better?

 

I don't want to sway your decision - but I (personally) can't see there being much price movement in this units for a while. There's an abundance of them - and apartments/units in Canberra generally perform poorly.

If it's an IP you'll have rates, land tax and body corp eating into your cashflow :-(

Cheers

Jamie

 

There is a significant difference in rates and body corp between this area and Braddon/Civic. The latter being much higher (1.5 times to 2x) for a similar priced property. I understand the capital won't go up in value in coming years, I am more concerned about vacancy rate. We are in a bubble anyway, I doubt property price will increase anywhere at all in coming two years.

My theory is this area is already saturated with apartments and the worst is over. If you look at other areas like Tuggeranong, Woden, Gungahlin and Molonglo, the worst is yet to come when all these newly approved apartments start mushrooming.

 

Too much supply can’t be good for the potential rental price of a unit either?

More rail speculation in the news today too:
Faster Sydney to Canberra train route could be built
(I’d say the 3 hour option is actually pretty competitive with the bus. Obviously I’d like the 48mins high speed but this has been put off for decades)

 

So the rental reforms for Canberra begins. it looks like some form of rental control coming in.

https://www.canberratimes.com.au/na...for-tenants-to-have-pets-20181024-p50bpk.html

 

I can't see any positive reason to invest in a unit in the ACT. I certainly do not think the worst is over in terms of rates and supply. Look at the vacancy rates...they can only really go up from here yet unit values are falling hard.

 

Just checked vacancy rates for Harrison/Franklin on SQM research. It is only 0.5% (best in the country). Only 20 properties are free. ACT market and outlook is still better than rest of the country.

Other markets I am looking at it is Wollongang and Sydney South West. But ACT is unbeatable in terms of gross yield.

 

So next week the local government will be table a raft of changes
ACT rental laws set to undergo shake-up

 

It will be interesting if they restrict price increases to less than the increasing percentage in rates and land tax. Why any investors would buy in Canberra for yield is beyond me.

 

Sounds like something out of the Soviet Union. And like the Soviet Union, it will probably backfire. Markets > Governments (even if they make rainbow roundabouts).

 

Geocon are advertising '7% gross rental yield guaranteed for 24 months*'

hopefully people do the research before buying! including strata which will probably have nice jump in year 3

 

Hey all, can anyone recommend a good kitchen renovator in Canberra? I've got an old unit (80s build) and I'd like to do up the kitchen and put a dishwasher in. Also does anyone have a rough idea of how much this is expected to cost - I'm getting the sense of 10-15k. Thanks in advance.

 

Sold of $645K - Link

Another 3bed 1bath (17 Parer St, Scullin) across the road from above property sold last week for $675K prior to auction. That is a really good price of 3bed 1bath house.

Cheers,
Oracle.

 

Canberra is expensive when it comes to tradies and renovating :-(

I can’t recommend anyone in particular but be prepared for the quotes to come back higher than expected.

Cheers

Jamie

 

is that right ,

@AnDy62
you get one quote and then get a bigger quote on second opinion,
even if you hire someone agreeing to their quote they might just not turn up,
if you are project managing your own construction/renovation you are in for quite a ride

 

I don't know anyone that does kitchens specifically but have found a decent tiler, electrician and plumber over the years. PM if you'd like recommendations.

Looks like Belconnen is still chugging along...

54 Chewings Street, Page, ACT 2614 < sold for 880k. Extensively renovated, even their laundry is really nice. Still a really great price though

These two in Scullin went for just under 700k:
14 Wirraway Crescent, Scullin, ACT 2614
87 Chewings Street, Scullin, ACT 2614

 

With the new rental laws changing limiting rental increases... yield growth is now capped... with the increase in apartment construction, would take some demand away from detached dwellings... and I read land tax for ACT is to be steadily increased over 20 years... I have to ask - why would anyone want to hold an IP there...?

I'm sensing the ACT govt either a) does not care it is creating a housing issue at the lower end, b) is too greedy/shortsighted to notice or c) just really dont like landlords

PC gurus -please advise...

 

I'd go with b).

Are they really going to cap rental increases, that's sheer USSR madness!

 

The ACT govt is Labor. Land tax is meant to be a better way of taxing and to replace the stamp duty, which is applied front end.

It has governed quite well though its treatment of landlords is not fair nor wise. It is a vicious cycle - the more govt charge the landlord, the more the landlord has to pass the cost to the tenant. Landlords also have to be more discriminative to get the right tenants at the start so increasingly the ACT govt will have to look after tenants who do not have good financial credentials. The tenant in the lower socio-economic strata will feel the squeeze more and will lobby the govt for more assistance. The govt thinks the landlord can pay for additional assistance for tenants and place more costs on the landlord. Some landlords drop out of the business of providing rental accommodation, supply drop and market rent increase...etc.

The net result will mean that rent has to be going up and Canberra. Rent is comparable to Sydney. See Renting in Canberra is nearly as pricey as Sydney

 

You wonder if dwelling prices start to fall will that be reflected in the Land Values and Land Tax Assessments....

Not holding my breath for that one.