The problems of OTP ... Securing finance in the APRA environment

You gotta remember that the prices people paid in The Ponds 3 years ago is actually cheaper than what people are paying now to live all the way out in Spring Farm. The Ponds is a 7 year old suburb, not 1-2 like Marsden Park estates. Marsden Park is pricier than what The Ponds was. Schofields is half and half. Half bought 3 years ago and half bought this year. Riverstone mostly this year and last. Marsden Park mostly this year and end of last yr. those prices are expensive. Land in The Ponds was $1000/sqm until the beginning of last year.. That's way cheaper than Riverstone, Marsden Park and Schofields is now and The Ponds is built out.. In saying that, there were many people who overleveraged and overcapitilised and they will cop it the worst..

 

You have a habit of finding crap deals

 

@sash and @ej89 Yes, that does make sense from the detailed calculations that you posted above.

I was under the impression that Northwest area will be the next blue chip due to the HERRON TODD WHITE - MARKET INFORMATION report this month (attached).
page 6:

New development in Marsden Park in Sydney’s north west is now underway. Linfox, Costco, Ikea and Lindt have all confirmed their places in this new business park.​

This was cited by the Reaql Estate agent as well who offered me the H&L Package in Marsden Park.

 

Developers shouldn't be directly affected by APRA if they're on commercial products.

 

If you ever wanna buy in the new estates don't buy packages.. put it this way, 3 bed H&L packages on 300sqm in Marsden Park were selling for 610k earlier this year..If I got land there I could've built a 4 bedroom Allworth Home for 520k all up..That's 90k cheaper and an extra bedroom.. Instead, my 4 bedder in The Ponds is same price as the 3 bedder in Marsden Park..

Blue chip is quite subjective but yeah I can't see Marsden Park, Riverstone or Schofields ever being as bluechip... Great job prospects with Sydney business park though but that is factored into the pricing already..

 

Hey, that may be a great business idea right there.
Private lending to fund the shortfall of your OTP purchase.
Can't settle? No worries, call us now for access to "Premium" rates.

 

Charge same price as personal loans

 

The "Premium" was actually intended as, in favour of the lender, not borrower
Still, its a win-win'.
Don't like it, take your alternative options....

 

Become the lender and you're winning..

 

@ej89 and @sash Yes man, you are right, too many off the plan estates can cause warning by the banks as can be seen from Riverstone NSW 2765 case here: http://www.propertyobserver.com.au/...-australia-s-most-vunerable-40-postcodes.html

But somehow shocking Auburn NSW 2144 is mentioned in the article above. I guess that was due to dodgy Selim Mehajer apartment deal. Why is Auburn is ever mentioned there ?

Because the following reasons should be supporting the price growth for Auburn:
1. Close to Parramatta, it should enjoy ripple effect from the CG for the next few years.
2. Next suburb is Lidcombe where the price has already gone up quite significantly.

isn't that right @WinDyz. ?

 

Riverstone was not new estates.. The new estates are just being built now. You'll probably see 50 new homes in al of Riverstone atm. It's a low socioeconomic area and thats why it's on the list, not cause of H&L packages...

 

The kitchen person we've used has his factory out in riverstone and I checked it out as a place for a medical centre .

Interesting place , bit like how I imagine Penrith would have been 50 years ago .

Toyed with a five acre site in the last cycle. ? Around 7-800 k .

What would that be worth now ...

Cliff

 

It was a good time to buy OTP in Sydney 3 years ago

The bank effectively lent me 100% LVR no LMI, thanks to the increase in value in the 2 years waiting time before settlement

 

What they will or wont take as deposits is determined more by the funder from whom they are securing their finance for the construction. I suspect you'll start seeing more and more banks require cash deposits, and possibly even 20% instead of 10% .

 

This is precisely why I passed on the NRAS opportunity in Jordan Springs. As standard protocol I undertook a series of "tentative on completion" valuations - 9 in fact - and the vals were all 80-90K light. These are substantially completed and will settle within 4-5 months so the valuations are not going to improve much ( if any) Given the probability of further LVR restrictions , anyone purchasing these dwellings could be looking at funding 20% + stamps + 80-90K shortfalls. It's a perfect example of why you have to ensure valuations are at least in the ballpark before commiting to OTP in any way