VIC Melbourne Rezoned - ACZs, NEICs, RGZs GRZs etc

Just thought seeing many ppl seem to think there is minimal growth due to cycles etc IMHO I think there is a lot of upside if u are in a rezoned or within the activity centre. It is also not hard to acquire a growth zone property either inside or outside the activity centre zones for the upcoming suburbs and i see some like @Westie @wa2. The only person i think has talked about them is iamnumber5 which has one in sunshine and i recall a builder who commented on plenty road bundoora about some blocks flipping sites for 300-400K easy.

Activity Centre Zones are Basically in a nutshell are part of melbourne 2030 plan and was created back in 2007 whereby the victorian planning authority in conjunction with the local council/government is looking to have a maximum 20 minute commute by relocating resources and infrastructure like transport, shopping, schools etc into selected central zones in various suburbs ard melbourne. Many of the councils have been slowly developing plans around this Activity Centre Zones and over time more and more areas are rezoned. A lot of these areas have subsequently turned normal property affected by medians and cycles into million dollar sites. Now look at the diagram below outside of ones highlighted in yellow ones just abt everyone else is approaching or already in the million dollar club. some sites in sunshine were like 500kish going back 2 years, Preston - Northland 600Kish last year) but slowly now creeping and nearing the million dollar mark.)

So really there are only a few left - epping, werribee, frankton etc - now it is quite impossible to cover every area as a lot takes time and effort. so i will just talk about a few of these.



NEIC stands for a national employment and innovation Clusters where is an additional focus towards building employment opportunities through hospitals, schools, universities, or previous industrial areas





Recently - in april 2017 this year, the vic gov introduced minimum garden requirement for sites and this applied to vast majority of properties which are in the general residential zone. The residential growth zone (RGZ) was exempt from this.

So what does this mean if u can only build 3 townhouses ur Site is worth x dollars end value but if u can build 6 ur site is worth x times 2. Why as setbacks are crazy you can actually build to the boundary for the site setback x meters into plot. You have higher heights meaning if can have more bedrooms or bathrooms which is worth more and thirdly for some not all it can me mixed commercial which everyone shd know rents a lot. you do not have to follow the minimum garden requirement. Now look at this average sized block in the general residential zone around the same size And look at what can be achieved with the growth zone we're talking just sub 600sqm

site which is zoned GRZ similar size (end value after dev (600k X 3 = 1.8mil)





site which is now RGZ - end value after dev (600k X 6 = 3.6mil)



Look at this crazy site that sold with a permit sold for 3.7 mil dollars (this is even more expensive than some million dollar suburbs ) which really is goldmine. Location is not the greatest tbh - but due to zoning - it has achieved 300-400% return



Look at the preston northland precinct - sites that rezoned that were purchased for 500K are now flying off the shelf for 800-900K and some even 1 mil.New roads being expanded, new transportation being built. Next to Latrobe uni, summerhill SC, new bicycle paths. (The same will happen in Werribee - as i spend some time reading the plans and is no different)




Actually a lot of overseas buyers know this info first hand and have been looking to collecting and purchasing sites like this but outside of iamnumber5 In pc i dun think many ppl have purchase a property in the ACZ or the residential growth zone. A group of indonesians bought a site 500sqm for 500K and did 10 apartments basically having an end value of 5 million with equity of 2 mil. so it really applies both on smaller blocks and larger blocks.

take the ACZ within frankston and @WattleIdo will be happy to know that there are so so many blocks in the zone ripe with opportunity that is not out of the reach or many. Nobody is asking to buy in the doncaster hill activity zone or chadstone activity zone.




hence like i said - a lot of outsiders know this and have said melbourne is the gold mine for devs - it is very obvious




In my very humble opinion, I feel buying in the res growth zone or within the ACZ or in the NEICs is really a "no brainer" which they are still "So Many of these sites" available in melbourne the "figures will always stack up" if u do not excessively overpay and have the right product. This is different to waiting for boom cycle, population growth or looking at medians or cycles as the state gov basically has outlined plans what is going to be grow etc and very clearly too I might add so one just have to look hard enough. The logic is so simple - higher density = more $$$$.

Again others might disagree - but each to their own -everyone has to have their own path to walk. Also forgive me if i have any typos

 

Very informative, thanks @melbournian .
Would live to get something in that ACZ!

 

Thanks for posting this @melbournian .

 

@melbournian , I have seen development sites similar to mine around the same area sold for more than 50% than what I paid for in less than 1 year.

This might be of interest to you.
23 Victoria Crescent, St Alban. Activity Center Zone, lot size 800m2.
Original Plan and permit for 20 dwellings & 2 commercials. Shown below:



Currently being reapplied for 27 dwelling & 2 commercials, as shown below:

 

no worries - congrats on your residential growth zone site purchase - like said anyone can buy one if they look hard enough

 

yeah high density - renders look good too.

 

Thanks @melbournian .
Is Frankston yet to to re-zoned? I don't see ACZs or RGZ in the planning maps website.
For ex: the following property falls in activity zone as per the planning documents but it is R1Z in land planning website.
38 Nolan Street Frankston Vic 3199 - House for Sale #126736642 - realestate.com.au

 

Any block with land within ACZ is advertised as such in the Heading of the ad, hence this is no secret. And there are no RGZ in Epping, unless I am mistaken.

 

there will be advertised however sometimes the agents does not put my highlight to the zones.

very true - sometimes, the council like whittlesea just put a blanket zoning across the areas- epping attended an auction for one where a chinese lady was asking me how to look at the s32 - i said you can build to x storeys - and long story short she ended up bidding and winning. Although it is not classfied as a growth zone but as in the activity centre zone - the setbacks and height provisions and the same or even better.

similarly, Northland ACZs has actually not been fully determined with some being in GRZ, RGZ and mixed commerical zones.that is why good for ppl to research. if in the GRZ - the numbers most likely would not stack up unless you are in premium suburb or bought it cheaper a while back.

 

ACZ is definitely there - you would have to read the frankston C123 activity centre map and see stuff like building heights setbackups etc. Similar to epping they don't put the RGZ there but rather a blanket ACZ across the board

 

Hi Saray4,

Would you mind sharing the planning documents where this address sits in the Activity Zone ?

Cos according to the map which @Mebournian attached in this thread, I'm seeing that Frankston AZC is bounded by Flowman place and Fletcher Rd. Seems like 38 Nolan St is outside this boundary ? Would be interesting to know if someone could confirm this ....

 

While on the topic of ACZ, I just like to share an info that planning permit is not subject to advertising. So one less headache.

 

I could see that the property is within the Metropolitan Activity Center boundary.
I might be wrong as this boundary looks different to the one Melbournian posted.

 

@saray4 the one i put up is more the individual precincts. @VanillaSlice best to refer the doc or ask frankston city council in the area. Like it is really hard to cover all areas - me i know the western and northern and eastern ones a bit but to althought i did my high school off mt eliza - someone with more on the ground frankston exp like @WattleIdo should be able to let you know what is happening.

It is impossible to cover every ACZs around melbourne hence why i created this thread so others can share personal experiences. there is only so many auctions one can attend over the weekend to get buyer sentiments see the numbers who turn out. see what kind of buyers are in the market - home owners, investors, demographics buying.
For the north and west - still so so many turnouts in all these areas (investors and home buyers)
and this email which is recent - shows a lot of rezoning is still occuring



sometimes i am suprised that some seasoned developers can't make the numbers stack up. i personally know of someone who has purchased 18 sites this year across ACZs in frankston, reservoir/preston, sunshine, st albans, werribee all either growth zone or ACZs and instanty made 5 mil- 7mil in growth in one year.

go to the VPA site - the plans on what is going to happen is so readily available
Home - VPA





again - you don't necessarily have to purchase in the ACZ if it is out of budgetd $$$ you can purchase a RGZ (residential growth zone) site which will give you much more density as oppose to GRZ (general res zone).

 

@melbournian this question will obviously vary depending on area/size block etc. But what kind of buy in price difference are you seeing for a similar size block from acz to rgz to grz if in the same area?

Also thank you for posting this thread, been hoping you would do this for ages.

 

similar sized Double block in reservoir was sold 1.3 mil in GRZ 1.62 in RGZ (diff of about 300K) diff between sites less than 400meters apart.

Also hard to say as different areas have different prime areas

i saw one in sunshine before diff of 500-600K being in the ACZ and being not in the ACZ.

 

So the blocks have been priced accordingly already as people are aware how many can be built. Eg, as you say 6 vs 3 townhouses increases your end profits but you pay more to get in.
So purchasing these blocks are gold in an upswing as each townhouse (end product) would increase and 6 increasing over 3 gives a much better result. And the opposite should occur when the markets turn.

 

was this just natural growth @melbournian ? or did they add value to the sites via obtaining permits and subdivide etc ?
18 sites in these areas would require some serious hold cost

 

@Barny yes but once density increases (it covers up and reduces the overall risk)

let's say for e.g. just 600sqm site - eventhough 625K and cheaper than RGZ for 850K. if a developer comes in and buys and develops right till the end - see the table below (i have projected a drop of 20% which is extreme) it still comes up as a gain over a standard GRZ site. assuming 600K per townhouse



there are consortiums who buy large devs and hence that is why a site in preston (which in the ACZ with permits) sold 3 million, apartment devs and heidelberg Heights 3.7 mil (actually know one the person who bought it - they have research tanks crunching numbers and have already projected figures for downturn)
but i think if you get in early - say 500Kish you are in a commanding spot @saray4 . of course market has risen so it is not that easy - maybe geelong might be a good option as well

 

mixed permits and natural growth. the guy is pretty cashed up. SE Asian.

I have a my friend who bought a site in clayton (obtained permits - 150K) bought 4mil (2012) sold 9.5 mil (2016) - now that is serious coin - who says investors are leaving and they're no commie chinese i might add