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Richmond or New Suburbs

Discussion in 'Where to Buy' started by sachin singh, 4th Sep, 2016.

  1. sachin singh

    sachin singh New Member

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    Sydney
    Gents

    Good Evening, I am new to this forum and I am looking to invest a property in Melbourne and nearby suburbs. Love to have few suggestions on confusion i have in my mind:

    1) Richmond or any of closest suburbs to Melbourne has apartments coming for around $1M. Is it good to buy there. whats the chances to get a good appreciation or rental income there?
    2) An appreciated suburb such as Heidelberg or Point Cook. Where i can get a house for 700k to 850k for my own living but wont get much value in next 2 yrs as its its already highly appreciated.
    2) or Lastly Getting the big house near Wyndham Vale or New suburbs far from CBD which will appreciate after 1 or 2 yr.

    Its creating a lots of confusion in mind to narrow down the suburb to live or move there.

    Thanks for your guidance and support.

    Cheers
    S. Singh
     
  2. ashish1137

    ashish1137 Well-Known Member

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    Hi Sachin,

    First, do you really require more land and a big house to live in?
    Second, the kind of suburbs you are targeting, you might have to see a decline in coming years (just saying, it is a possibility). Such possibilities can be in any markets and you are targeting market that has substantially grown in past few years. Also, you are targeting a premium house.

    Here are few questions:

    1. Can you move further out?
    2. What do you want to achieve with your purchase?
    3. Do you realize that buying apartments will not take you anywhere in your investment journey?
    4. Do you care if the price at which you will buy a house might drop in future?
    5. Are you planning to release the equity in your house in near future?
    6. Are you willing to leave your dream house over smaller profitable investments and stay on rent for some time?

    Regards
    Ashish
     
  3. MsAli

    MsAli Well-Known Member Premium Member

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    Why do you reckon so?
     
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  4. ashish1137

    ashish1137 Well-Known Member

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    1. Land always appreciates in value (unless you made a very very bad choice- chances 10-15% I'd say).
    2. On the contrary, apartments are in abunfance everywhere (opposite to houses, apartments appreciation will be 10-15% chance).
    3. Apartments are also prone to strata costs, thereby inpacting your cash flow while calculating yields.

    Taking a broad point of view, I think there are more chances one will make mistake while buying apartments. So, I do reckon that custom houses on very small blocks even a little far than normal considered kms (distance will depend on respective state) are far better than apartments (unless apartment has water views or something special about them).

    Even in latter case, I would prefer a house.
     
  5. Jasmine

    Jasmine Well-Known Member

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    Don't let the oversupply scare you away, just don't support an OTP deal. Rental income is great when you find a tenant.
     
  6. MsAli

    MsAli Well-Known Member Premium Member

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    To clarify. .do you mean if a house value grows $100 an apartment value would grow $15?
     
  7. Shawn

    Shawn Well-Known Member

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    One more Singh on the forums.

    Best of luck Sachin, I do not know much about Melbourne to help :)
     
  8. radson

    radson Well-Known Member

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    1. Unless you are in Mining Towns, Japan, Ireland, Spain, Perth, Darwin etc etc

    2. As a rough guide 80% of Aussies live in homes and 20% in units and apartments.
    1301.0 - Year Book Australia, 2012
    3. Houses are prone to council rates, maintenance etc etc impacting cash flow.
     
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  9. melbournian

    melbournian Well-Known Member

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    1. Why Richmond? THis suburbis already very expensive. Personally to live there, there is a lot of housing commission flats in some parts and it is really expensive in those areas too. Unless you have a decent liking to phos and Vietnamese food - maybe but it is an area not for growth I believe for apartments. It is more for the developer who buys a run down cottages and then puts another storey on top.
    2. Heidelberg is already expensive (for decent size) you looking at above a million. Already heidleberg west (the ugly cousin) blocks selling for nearly 700K in the weekened Point cook you could get anything for high 400Ks - 700K depending on size of land and house which is right in your budget. (Also Pt cook seems to be growing). And a lot of Indians demographic wise (so lots of restaurants and food groceries)
    3. All depends on your objectives - if it is for your PPOR - you should buy where it suits your needs and lifestyles be it apartment, townhouse or house. Wyndham Vale if you work in the CBD can take a while to get there by car in peak hour though the gains may not even be realized. Point cook have a very slow start before jumping like just recently.

    Questions to ask yourself is where do you work, what is your normal routines, lifestyles etc. Do yo uprefer to be in similar demographics to yourself, temple, groceries etc.

    If it is was investment and to make some coin, and you have that 850K I would get rundown cottage and up the loan to a mil+. as the margins there are larger than any apartment

    That being said apartments is certain suburbs do every well. Some are in oversupply arena but in some outer suburbs

    Hawthorn and Deepdene properties blitz reserve by more than $1.2 million at auction

    "Two apartments, 2 and 2A Fairview Road in a riverside nook of Hawthorn, sold together for $3,825,000 at auction on Saturday. It took just seven bids, on an opening of $2.4 million, for the unassuming 1930s property to hit reserve."

    A lot of posters do a general assumptions that everything apartment wise is bad without understanding that every market in Melbourne has some level of a micro market to it. To say Southbank apartment market is the same as for example glen Waverley or say dandenong is not true. One rents more and some appreciate more A villa unit in sunshine is very different to a villa unit in brighton for e.g.
     
  10. Justin

    Justin New Member

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    You are correct in saying that land appreciates. The mistake most people make is thinking that their 400k house is going to appreciate much faster than an apartment in a premium land spot. A house that's worth 400k would have a land value of approx 100-150k, so using your method, your only gaining on the 150k, as the house actually depreciates. If you secure an apartment in a premium area, that is not prone to oversupply, such as Brunswick or similar, which has an average annual growth rate of 6.1% over the past 10years, you'll see many more benefits than a 400k house in melton for example. With the shift in the current market, many people are preferring to live closer to the CBD without actually being in the CBD. this is due to the fact we are a generation that wants a great lifestyle.
     
  11. SeafordSunshine

    SeafordSunshine Well-Known Member

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    Gents
    Regards
    Ashish
    ???Who??
    Dear Ashish,
    please get used to the idea that many, many successful PC contributors are Ladies:)
     
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  12. Gockie

    Gockie I'm an ISTP-A female, so I might be a bit quirky! Premium Member

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    2nd that.
     
  13. Chabs

    Chabs Well-Known Member

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    1. I don't think you can put a number on the chances that easily and that broadly. You cannot paint all land with the same brush! Some land will always go up, even at 10%+ p.a., some may sit flat for a long time.

    2. Yes it is easier to get apartments, however there is empirical evidence that location is a much more important for faster growth rate and there have been numerous areas where apartments have performed strongly, stronger than land in other areas.

    Essentially demand is influenced by much more than what you're saying. Location has traditionally been the biggest factor.
     
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  14. Gockie

    Gockie I'm an ISTP-A female, so I might be a bit quirky! Premium Member

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    Edit:
    @sachin singh... many successful property investors are female. We may help you out if you address us too. Otherwise I may do something like ignore all your posts. @ashish1137... apologies. Carry on.

    Yes, the thread being started addressed "Gents" really irked me.
    Its like if I was to start a generic thread just addressed to ladies only... why discriminate?
     
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