Hi all, How significant an influence on value (yes, how long is a piece of string) can a railway along a boundary fence have? Is this one of the no-nos, or more a 'slight reduction in value' factor... Does anyone have such a property and like to share their thoughts on the pros-cons? Cheers. Here's all I could find on Somersoft:
Personally, I wouldn't go for them because I'm just of the opinion that no matter how much of a discount you get (realistically speaking), that your prospective tenants would be smaller as a lot of people can't stand the noise factor. In saying that though, there are awesome ways to reduce noise in homes now, so I know some people do that sort of stuff.
Banks generally don't like them either. If a full valuation is required - the valuer will assign a high risk rating to the property due to the close proximity to the railway. Therefore - the lender may require a 20% deposit. Cheers Jamie
My place almost abuts the railway line, I bought in 1996, the railway station is about 300 metres away and over a major road. Personally, it has never been an issue for me, the actual train goes through fairly quickly, if you are closer to the boom gates though, ie, a crossing, it is pretty noisy. When the very late trains go through it is the dinging bell of the boom gates you hear, not the train itself. Recently, the house was valued for another loan, the valuer made unhelpful remarks about proximity to the railway line which meant the loan had to go to the next tier of authority, it was still approved and came in at expected value. I was surprised at the valuer because I had heard the Principal of the agency he came from saying on radio the week before that walking proximity to the station added 10%. Of course you can still be in close proximity but not abutting the line but you would have to be pretty close. I have noticed on the line the house is on that over the past ten years parking has exploded around railway stations, it can be really very intrusive, particularly now that paid parking has been introduced, people are parking on suburban streets to avoid paying. Luckily, my place is not so close that people are parking there. I hope that helps.
Danger Will Robinson! Stick to the A-grade properties, there are hundreds of thousands of them in Australia, no point giving the valuer pure discretion on how much discounting they believe if necessary for all valuations on your future equity releases. Bank/LMI aren't a fan of them at all either - which will cause ongoing concerns for eventual sales etc.
I actually purchased 2 properties (side by side) in Melbourne few years ago now, railway along a boundary fence, but I was able to add value to this property due to land component/zoning. My strategy was to purchase below market value and add value. I had no issue on selling this property with around 40% profit, I organised a DA, plans and permits for 8 apartments and flicked it to a builder, there was plenty of fat for him and I the market was very strong for development site. Would I do this again, yes for the right price. Would I do this in a flat market? no MTR
