NSW Central Coast - Is excess supply going to become an issue?

Discussion in 'Where to Buy' started by newinvestorlottaquestions, 22nd Sep, 2021.

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  1. newinvestorlottaquestions

    newinvestorlottaquestions Member

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    Hi all,

    I'm looking at purchasing my first investment property in Kanwal / Gorokan. I understand the area isn't the greatest right now, but that it has potential to gentrify. I wanted to ask for opinions about buying here however, as I know just to the north west in Hamlyn Terrace there is a lot of new properties springing up as it's a new suburb.

    We're spending about 800k, and the place we're looking at ticks most of the boxes, except I have no idea what the new developments mean for potential capital growth. There is a <1% vacancy rate right now and new property is required, but I struggle to see why someone would want to buy a 30year old property (What we're looking at) when they could buy something far more modern for not much more 1 suburb across, even if the land is a bit smaller.

    Ideally I'd like to buy closer to the coast in budgewoi / noraville / toukley, but recent price rises in that area mean I don't think we'll find a place with decent yield right now. Is it a bad idea buying west of the lake?
     
  2. Boss

    Boss Well-Known Member

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    When investing anywhere on the coast it's best to either buy as close to the big blue thing as possible or buy an acreage not far from the big blue thing.

    The big blue thing can't be developed; it creates a finite supply of land: you're better off with an older house close to the big blue thing than a new house further away from the big blue thing.
     
  3. ashish1137

    ashish1137 Well-Known Member

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    What new developments are you talking about?
     
  4. freddy

    freddy Well-Known Member

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    Lots of small land releases wadalba, warnervale, berkley vale all now getting smaller and now selling 600-700k! Only 9 months ago probably half that price. Build costs continue to rise so any house under $1m that’s less than 5 year old is better value.
     
  5. freddy

    freddy Well-Known Member

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    Sold for $890k, a few years ago they were practically sat unsold for $590k
     

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  6. Serveman

    Serveman Well-Known Member

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    Is Gorokan starting to gentrify because the prices are on the up and that can change the demographics of an area? It seems though that everything that used to be 500k in NSW is now a 750k prospect.
    I know the area quite well and if I was looking in Gorokan I like the Marks Road area with lots of houses with water views of Tuggerah Lake. Then if you go to the southern end of Marks Road and head up the hill there is a nice pocket there. The advantage of this pocket is that it gives you elevated views of both Tuggerah and Budgewoi lake and also Birdie Island and the ocean v behind.The other thing you find in this southern pocket is that it’s protected from the storms that can rip through the area.
    The other parts in that district that can be appealing is the Norah Head section and maybe Buff Point.
    The areas that tend to be harsher in terms of crime are suburbs that end in the name Haven and Remo.
     
  7. freddy

    freddy Well-Known Member

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    absolutely right all the $500k suburbs are now close to million dollar prices. Landlords now raising rents $200 per week being taken up by Sydney siders. It will slowly become an extension of Sydney sooner rather than later.

    as I said if land releases 400m2 selling for $600k-700k then anything in the $700k existing houses is only paying for the land value. Sydney equivalent land in western Sydney new release selling $1m++land under 400m2.
     
  8. Kersertwo

    Kersertwo Active Member

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    Anyone think 500-550sqm for under 800k is unrealistic in the stretch from Killarney Vale to say Budgewoi? are things starting to slow?
     
  9. freddy

    freddy Well-Known Member

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    Budgeiwoi potentially at slightly under $800k, even wattanobi is hard to get under that.
     
  10. Kersertwo

    Kersertwo Active Member

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    Cool thanks, you have any opinions on Budgewoi? Looking for an investment property and initially (start of last year) Killarney Vale was as far north as I could get in budget and feel comfortable i was in still in a good area. However after being priced out forced to consider Budgewoi/Gorokan
     
  11. freddy

    freddy Well-Known Member

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    I was looking for a future property to retire in hence my criteria was different a few years ago. I bought something similar to a property 17 Melbourne Rd Wadalba. This one only sold recently for mid 800k move in ready and now mid point value of $1.4m. This is justified because of left land parcel and build costs of that quality.

    cookie cutter house and land on hamlyn terrace 400m2 were $590k a few years ago now recently sold for $890k. If you bought well in established suburbs, old shack on a good street and suburb or bateau bay/Tumbi umbi the gains would be $600k+
     
  12. freddy

    freddy Well-Known Member

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    This one massive capital gain in two years, easily worth $1-$1.2m as is.
     

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  13. freddy

    freddy Well-Known Member

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    Aim to buy with large parcel of land in better suburb with an older house. I wouldn’t be comfortable paying close to $1m there however some recently selling for $900k. I guess the difference to somewhere in west is that has the best accessible free beaches as good if not better than northern beaches
     
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