Sydney Not Stacking Up..Young moving to Melbourne

You definitely can make money on H&L in Melbourne. Likewise in Sydney.

In fact, I made money on H&L in Sydney at Schofields. Bought in 2014 for 580K and got valued last year (2016) for 815K (yes pulled out all the equity). In many ways, you can buy ANYTHING in Sydney 3-4 years ago, even with overpriced OTP apartments, and you would still make money (as long as those apartment settles of course!). With depreciation tax benefits it is even better on the cash flow.

I see similar thing in Melbourne, you could buy just about ANYTHING in Melbourne within last couple of years and would still make money. It is a matter of how much MORE money you would make if you buy H&L in Melbourne, vs older house in more established/blue chip suburbs in Melbourne.

 

It's ironic this H&L game.... up until 2015 my main strategy was developments, buy existing, get a DA, develop and sell. This strategy, while profitable had its risks and needed decent capital input to avoid paying profits to the banks as interest. I'd only done 3 H&L's prior to his in 2010.

From about 2015 I started to notice that I could get 30% margins in H&L projects, which rivaled my development projects.....but with less risk and around 6% yields.... So again I added H&L into my strategy.

Even in June/July 2017, I put together a H&L deal where comparables are asking 200-250k more. Although at the higher end of the market, this does show that there is still opportunity out there with this strategy..

Another deal in Werribee I secured in Jan 2017 already has comparables asking 70k more.

So yeah, lately I haven't been harping on about this strategy like I used to.....it gets abit tiring engaging in debates and getting told that "you can't make $$ in H&L"...from people that simply don't know the markets....apart from what google maps and a few generic stats show them.... The numbers still make sense in some outer Melb areas

 

Love your story!

 

Going on the article, yeah,,the best thing melbourne has going for it is that its attracting young skilled workers- both from within australia and outside.
That is a huge plus for the long term sustainability of the city- that is exactly the kind of demograohic you want.

Regarding H&L, my 2c is that if one could not make any money on it, it wouldnt last for as long as it has done - same with OTP- there is a market for it and possible to make money; just that the conditions have to be right (as with any investment)- i dont know what those conditions are but if they did not exist at some point ( may or may not be now, i dont know), then the product would be defunct.

 

Latest unemployment rate
NSW 4.8%
VIC 6.0%

Why is the Melbourne West tipping the scale at 8.6%


Source
Welcome to the Labour Market Information Portal.

 

Looking at that nice little column graph in the article, my suspicions are confirmed that 'the rest of NSW' is already rocking!

 

Does not have to be blue chip, its just a fact that Melb market has been booming everywhere.

Land and house is a great strategy when its a rising market, but just about anything is. The only thing is you don't want to be left holding the baby when the market turns, not saying its turning, but you have I think perhaps 12 months with a new build, there may be more risk if it turns in the middle of the build/development.

 

Oh no not the Sydney vs Melbourne debate

OK I pick Melbourne over Sydney, has nothing to do with property but all to do with lifestyle, and I am a foodie. Cant go past Melbourne for lifestyle.

 

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And I pick ullanbaatar Mongolia over both Sydney and Melbourne.. They are both so overrated.

 

Both Sydney and Melbourne are growing at unsustainable levels. Melbourne right now has rising crime levels and becoming polluted. While house prices are rising rapidly, people's incomes are not. All those units going up everywhere in both cities is a disgrace and they are not the type of properties that local Australians would like to live in.
One thing about Sydney is that it's priced itself out of the market and that should slow down population growth. I can't see travelling from Newcastle and Wollongong into the city is quality of life unless one day we might see a very fast train line built.
In Melbourne you can buy 500k houses that are 35 to 50k out of town and I'm concerned how those suburbs will be like in 10 years time when Melbourne's population balloons and in infrastructure is found wanting.
I think the way we work will need to change. If you live in Sunbury Vic, you should be able to work there and not in the CBD.
Good luck finding a nice home in Melbourne.

 

OK but I though we were talking Australia..... if we are talking the world, then it has to be Italy

 

I said it a while back that Sydney will soon be a city of old people

 

Lightbulb moment ..... nursing home developments

 

Don't laugh...huge money there......

 

Any idea on yields for these and for-profit detention centres/prisons? Curious about returns.
All the google articles I find are about scandals, nothing seriously about how to invest and profit from these.

 

Some retirement village operators are listed on the stock exchange, with various operating models. Aveo is one publicly listed company in the spotlight after a big investigation by Fairfax Media into their practices.

 

Also, check out this SMH article from a few days ago on investing in the retirement sector: Where UBS small cap fundies are investing

 

this is the issue closed industry dominated by bug players

 

You mean those with a fair amount of wealth, yes...and also foreigners ( already seeing that now- those who have wealth). The rest may work in sydney but they wont be living anywhere close.

 

Stop stealing my name