Hi All, I am looking to buy my first IP but I am unable to decide the market. Apparently, the Brisbane market is projected to grow @10% over the next couple of years yet Melbourne or Sydney would outperform the Brisbane market on the other side of COVID19 crises. (I am personally inclined towards Melbourne with a budget of 450,000, not sure what I can get). what are your thoughts? and any ideas as to which suburbs to look for?
How do you know / predict that? Be prepared for a low rental yield for Melbourne. Do your numbers on how much of a negative cash flow are you okay with?
@Property Twins I am new to this. However, I can share what I have personally witnessed. A 300 Sq Mts lot at Boxhill NSW was going for $395000 last year - October 19. Now developers are quoting $430,000 for the same thing. I know this coz I was personally chasing this suburb but couldn't act due to lack of funds. Now, this is one suburb and that doesn't mean all Sydney suburbs appreciated in a similar fashion. PS: Prices mentioned above are from the same developers only 6-7 months apart. As for Melbourne vs Brisbane. I agree the property is going to be negatively geared. However, my question is it better to lose $50 PW on a $460,000 property over 10 Years, while the property grows at 5% annually? or make $50 PW on a $400,000 property over 10 Years, while the property grows at 3% annually? I had nothing better to do so played 2 scenarios. not trying to teach the teacher, rather I am trying to learn.
If that thing goes under $500k it's cheap for the area (unless there is something very wrong with it). Mid-4's is the go for 3BR units (in Victoria that means "villa" ~ as opposed to what we call "apartments") like this https://www.realestate.com.au/property-unit-vic-epping-123549134 We get $350pw (in normal times of course) for a 3/1 villa unit in the area. The Y-man
@The Y-man thank you, I live in Sydney, therefore have no clue about Melbourne. this is interesting. until now I was looking at western suburbs with a focus on students but seems like North Melbourne is all white collar. and yes it seems underpriced for the suburb 9 from what I can see).
To clarify Ayaz - do you mean North Melbourne the suburb (very close to the CBD) or North of Melbourne around the area Y-man linked & discussed above? There are very different demographics. Cheers
That is how land estates work. Start at x price and then the price keeps increasing and/or the land size keeps decreasing unless the market is going negative, this has always been the strategy for land developers. All predictions are speculations, buying something of good value with growth drivers and decent yield will ride you over any hurdles along the way.
Hey Ayaz - welcome to the forum I'd suggest thinking about the right product to buy as a first step, rather than letting your budget determine what you buy. The property itself needs to take you to your end goal, and what each type of property will achieve for you can be quite different even in the same suburb. And the right type of property will depend a lot on demographics, and how long you have to achieve your goals. Do you have a clear end goal?
It sold at the weekend, out of curiosity, what are your thoughts on the price achieved for the property? $509k
I just had another look - holy heck! That was NOT a good buy. That's bordering the DMZ (aka the land where a future freeway will go roaring through). Sorry should have checked when I first saw the ad. The Y-man
@The Y-man I didn't look at the DMZ part but thought it was a missed opportunity. However, Tarneit seems to be a good option as well. Especially considering its proximity to Werribee. what are your thought.
Brisbane is looking the goods as its in under supply, good yields and abit of projects happening on the north side. Melbourne is also in under supply and Sydney heading into under supply soon. If your not in a rush then hold back on Sydney & Melbourne, and I do expect Brisbane to be out of the traps first with growth.
