Hi All, I have purchased a off the plan property at Elderslie(2570) ,Camden ,Sydney.The house is nearing completion and will cost me $720,000 [Single storey house with 450 sqm land] .Looking at the properties listed for rent (around 10) and they all are still in the list for the last 2 months. Do u think that the investment property in this suburn could be a mistake as it does not have a train line. This is my first property and i did not do a bit of research.Do u think i should hold on for few years or sell it in a year or two. Any of your experience in this area or suburb can help. Please advise. Thanks Max
Camden is popular, but you will have to work out the rest, ask some local agents. If you think of selling, then it would be like a car, if you rent it for 6-12 months first, it is no longer new, so you have some research to do now.
Sell now, always good demand for new ready to go properties. Market is at the top, plenty more cookie cutter stock in the pipe line so holding makes zero sense at this stage of the cycle. Look yourself in the mirror and ask can you see this thing increasing another 100k in the next 5 years? No! Is it negatively geared? Yes!
Thanks Dabbler and Biz for your responses.. Yes it will be negatively geared ..but if i sell it now looks like will lose atleast 10k
Not a big fan of that area but if you are able to extend your search to greater Macarthur region you may find some excellent opportunities in Appin on the back of a huge land release coming up there. More land slated for housing development to Sydney's far south west Loads of big blocks coming up on the market and definitely better than buying in Picton etc.. Real Estate & Property For Sale in Appin, NSW 2560 (Page 1) - realestate.com.au
I say absorb a loss and sell. Your prospects for growth are, in my opinion, grim. Here's why. If you look at what is currently on offer for sale in the entire Camden area right now, there are 1116 properties on offer. Guess how many have sold in four weeks? Just 86, for the entire city. Many of these suburbs, including Elderslie, have worrying listings to sales ratios. 127 listings – 13 sales in Cobbity (allhomes) 167 – 12 in Leppington 140 – 10 in Oran Park 128 - 9 in Spring Park 110 - 9 in Elderslie Other areas of Sydney have a similar glut. What is going to happen when these developers, as well as recent and highly leveraged buyers and investors, start to sell in the hopes of avoiding a loss? The answer is discounting. In Ireland, areas like these made up the bulk of the house price crash - many turned into "ghost estates" - half developed with prices heavily slashed. New developments are bought into by people who have often over-borrowed and who often have little equity. They are also heavily owned by developers who are more comfortable discounting. They attract people looking for "affordable homes" as they're priced out of better suburbs, and this means those buyers often have less secure jobs and a higher tendency to default (in more well off suburbs, dominated by owner-occupiers, you see less discounting in a downturn as these owners are more likely to hold). If more desirable suburbs see any discounting, these will attract more buyers and renters (good areas saw huge, rapid rental spikes during Ireland's downturn) - i.e. you see a trend of "upgraders" wanting to move to better suburbs they once couldn't afford. If you look at listings, developers are already starting to use language like "priced to sell". There are lots of new prices. If that continues, more and more listings will appear, and eventually developers will respond and you will not be able to compete. Growth could pick up, sure, but Australia's population growth is at a 2 decade low already despite a quite liberal immigration policy. But banks are tightening lending, income growth is at a near record low, rental yields are at record lows, rates are likely to rise, and some economic turbulence on the horizon is probable. Sell. Buy something else, probably not in Sydney, which is indisputably overpriced right now. Buy a stand alone house in a good "tightly held" middle class suburb that has attracted little to no recent development, with good schools, close to a CBD, in a diverse economic area (i.e. avoid country towns). Consider something you can add some value to. These areas are in the best position to retain demand. Be prepared to hold it through any market correction. Avoid apartments and any newly developing suburb like the plague. Even if I'm wrong and discounting doesn't get underway, you'll have a more secure asset.
