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Sydney unit or Outer west Melbourne house?

Discussion in 'Where to Buy' started by BCR, 16th Sep, 2016.

  1. BCR

    BCR Well-Known Member

    Joined:
    18th May, 2016
    Posts:
    80
    Location:
    Sydney
    Hi All,

    Posted earlier, trying to narrow down on 3rd IP. I think I have covered a bit of ground and looking for some thoughts..

    Budget $450 up to $550k (upper end leaves less $ to add value)

    Bluechip / CG is ultimate goal - I aim to value add to get close to ~5.5% yield after 12 months, this will be a long term buy and hold.

    I have attempted to research many factors including forecast population vs dwelling construction, Immigrant preference, seifa index, infrastructure , gentrification, employment, vacancy rates to help narrow down areas.

    There is a huge amount info some of which conflicts.... In my mind Sydney has that ultimate scarcity factor to it, not sure if the areas I would be buying in Sydney may have the appeal that an area in outer west Melb may have?

    Hence I am stuck between going the Sydney unit (possible house) route or outer west Melb house. I understand Sydney is spoken about being at the top of it's cycle however as I have experienced when Sydney comes on its growth cycle its hard to beat for that long term CG.

    I will be using a Buyers agent - at this stage considering either Empower Wealth for Melb or
    Property Empire for Sydney, not sure which fork in the road I should be taking though to achieve strong CG in a 10+ year bracket considering such factors as the above.

    Anyone care to share their 2c??

    Thanks
     
  2. JacM

    JacM VIC Buyer's Agent Business Member

    Joined:
    12th Jul, 2015
    Posts:
    1,120
    Location:
    Melbourne, Australia
    Hi @BCR,

    The difficulty with units is that your ability to add value is limited to the defined interior space. In some cases, permission is required for the nature of renovation you are intending. The ability to add value outside is limited as for instance normally you cannot simply decide to paint the facade of your unit without permission of the owners corp. In a freestanding house there are more options. Internal renovation, external (building) renovation, garden renovation. There is also the possibility of subdivision / higher density later on down the track as council starts to relax its minimum block size requirements.
     
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  3. Kangaroo

    Kangaroo Well-Known Member

    Joined:
    21st Aug, 2015
    Posts:
    254
    Location:
    Sydney
    Totally agree. with JM.

    Also @BCR The total repair cost of all my houses pa is less than the the strata fee of any 1 of the units I have.(Building & Pest inspection plays some role here, fingers crossed). Talk with JM if not sure.
     
    JacM likes this.
  4. BCR

    BCR Well-Known Member

    Joined:
    18th May, 2016
    Posts:
    80
    Location:
    Sydney
    Totally agree and this is one the thoughts I had in the background - I own an IP (unit) In Drummoyne Sydney which I am reviewing now to add value however only limited e/g floating timber floor, repaint and new light fittings..... Just not sure from a CG & scarcity factor if I could snag an OK house location in Sydney rather than a potentially better location in Outer west Melb that may gentrify etc. Not a huge knowledge of Melb area,
     
  5. BCR

    BCR Well-Known Member

    Joined:
    18th May, 2016
    Posts:
    80
    Location:
    Sydney
    I pay $4800 PA strata on my place in Drummoyne, for my BNE purchase my previous BA was fantastic in the B&P space and made my purchase seemless.

    I could consider a lower end place in Sydney (lalor park eg.) or perhaps an area with more CG opportunity in Outer West Melb.
     
    JacM likes this.