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NSW Go on give me your opinion

Discussion in 'Where to Buy' started by Darlinghurst Boy, 30th Nov, 2015.

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  1. Darlinghurst Boy

    Darlinghurst Boy Well-Known Member

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    Before i read this forum , and was a excited newbie I would of rushed into buying the Bathurst Property i an showing you here.

    I think is a 18 sqm studio ,

    Many newbies excited see a cheap property think wow i will buy that because its relatively cheap and the repayments are not much.

    Now here is a cheap price property and I would like to know your opinions and experience on something like this.
    Now im a bit more experienced i wouldnt touch it but i would like to hear your opinions as well, some of you may say its a great investment ?
    $115,000


    Rent weekly 110
    Strata fees per quarter 299 per Q
    Councilrates per quarter - 290 per Q
    Other ? Agents fees.?



    Situated in the the Regional town of Bathurst NSW , is this studio , been on the msrket for a good few months .
     

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    Last edited by a moderator: 30th Nov, 2015
  2. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    Studio + regional town....doesn't sound like a good investment.

    Cheers

    Jamie
     
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  3. pinkboy

    pinkboy Well-Known Member Premium Member

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    42% of the rent goes to BC and rates. Yuck.

    pinkboy
     
  4. C-mac

    C-mac Well-Known Member

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    Agreed. Poor property type/spec for its area (Bathurst).

    That actual property aside though, Bathurst is in my opinion a great regional market.
     
  5. Chilliblue

    Chilliblue Well-Known Member

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    With all strata properties in the regionals, check the management rates as they can be horrible.

    Also, the smaller the property, the smaller the tenant pool.
     
  6. Scott No Mates

    Scott No Mates Well-Known Member

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    Then take off 8.8% in management fees, copious letting fees and advertising.
     
  7. larrylarry

    larrylarry Well-Known Member

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    As per the above reasons... No buy. A studio or 1 bedder in Sydney city will find tenants but not in regional IMHO.
     
  8. D.T.

    D.T. Adelaide Property Manager Business Member

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    3 weeks rent per quarter , that's 12 weeks per year to pay for the strata fee.
    About 11 weeks per year for the council rate you quoted.
    PM is about say 3 weeks per year. Allow about same again for insurance and about 2 weeks a year vacancy (or more by the sounds of a couple people above).
    Presumably there's loan repayments too?

    When exactly do you get a return for this?
     
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  9. Depreciator

    Depreciator Moderator Staff Member

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    Looks like it might have been a motel. I reckon the further out from the centre of a city, and the cheaper land is, the less attractive tiny flats are.
     
  10. willair

    willair Well-Known Member Premium Member

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    Gotta start somewhere,the only question to ask is,what is the property worth now..
     
  11. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

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    Sometimes when the listing says "An Excellent Investment", it's not.

    :)
     
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  12. D.T.

    D.T. Adelaide Property Manager Business Member

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    Yep, usually filter out any listings that use the word Astute, too.
     
  13. Tony Fleming

    Tony Fleming Well-Known Member Business Member

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    I looked at these about 7 years ago as my first ip I think they were about $62,000 to $70,000 back then. They've had their growth I don't think you'd be expecting any more capital growth for a few decades. Also the building is so old the sinking fund will expand and the return is already terrible. As a general rule of thumb I take the last three digits of a purchase price and if the rent is $65 higher than that number its worth touching from a cash flow perspective.
     
  14. bob shovel

    bob shovel Well-Known Member

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    It sounds like an excellent investment from the title, go for it! Couldn't be worse than Newcastle
     
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  15. D.T.

    D.T. Adelaide Property Manager Business Member

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    Just checking, do you mean first 3 digits ?
     
  16. bob shovel

    bob shovel Well-Known Member

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    Nah he's happy with 000+65! :D
    Sometimes he gets some excellent returns 999+65!!
     
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  17. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    its got everything wrong with it!

    $115,000
    Rent is $5,720
    Yield is 4.9% before costs.

    rates and strata are $2360 per year.

    This brings the return down to about $2788 after agent fees. That is a 2.5% yield.

    The capital growth would be limited in Bathurst. But due to the size of the unit the difficulty in getting finance would limit the limited potential growth.

    The agent's advertisment is therefore misleading and deceptive as this not a good investment.

    You would be better off putting your deposit into a savings account!.
     
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  18. bob shovel

    bob shovel Well-Known Member

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    Everyone appears to be missing the most important part! sketch-1448840652064.jpg
    Numbers can be manipulated
     
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  19. bob shovel

    bob shovel Well-Known Member

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    While your shopping around check out this little gem you might be interested in Screenshot_2015-11-29-20-26-26.png
     
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  20. D.T.

    D.T. Adelaide Property Manager Business Member

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    Looks like it might have a sitting tenant :p:cool:
     
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