VIC Melbourne investment property - 1.2m budget

Hi,
Interested in places to consider in Melbourne for 1.2m as an investment. We have a few other properties and cash flow is less important than long term capital growth. 7% + compounding is the goal
Happy to consider cosmetic renovation. Long term hold 10-15 years.

Thinking Cheltenham currently near train station / park but interested in other people’s views given budget.

thx
Spud

 

Property developing yourself is a good way to obtain quality property at wholesale prices that would allow for instant capital growth. 2019 Melbourne Property market conditions are now perfect for "end users" to develop. Prospective owners are at an advantage in this market as a lot of development sites are now for sale and if you can avoid the middleman (the developer) then you can enjoy the rewards.
Creating properties at wholesale prices also allows prospective owners to "suburb leap" into previously unaffordable locations.

 

Developing properties are not as easy as it seems, it's definitely not for the faint-hearted, despite what other may claim. As a L plater myself I can only speak on my own experience, sure you can "create" wealth, but at what cost?

 

Yes Property Development is not easy although current market conditions ensure it is easier than in days gone by particularly if you aim to own at least one.
The point is, there are massive rewards if you are smart about it and those rewards are hard to create any other way. Now is a good time if your aim is to be an owner.
It is a good way to get ahead and get into locations previously unattainable.

 

Paul: development yourself? do you mean being a builder for yourself?

 

I am an architect and we do some small time development ourselves.
We also facilitate development for our clients simplifying the process.
Also we helped people get ahead with Joint Venture Arrangements.

We never build ourselves, we leave that to the builders.

 

You want to buy 1.2m investment home? How much LVR is this going to be? You better hope your holding costs arent going to be stripping any if not all of your potential capital growth otherwise whats the point.

 

Yes
Seems one thing that is missing... you can buy developer sites cheaper today than say 18 months ago, however don't forget end values of the product could also be dropping. Developing in a downturn can be high risk business because feaso can only be worked out on today's values, yet we don't know how far it will fall??

If its a buy to hold, you will need deep pockets to hold a development site, as the value is in the land

 

Good point MTR.
My suggestion specifically suited Spud1966 because they wanted to acquire property. In my opinion now is great time for prospective property owners to obtain it much cheaper by removing the "middle man" and profiting off development themselves. In effect buying wholesale.
It is certainly not the best time to reap rewards from development by flipping as those feasos do not add up in that model.