Thoughts on Cranbourne West & Cranbourne

Hi guys
Looking for some precious opinions. Thanks in advance.
I bought a 3 bedroom house on a small block in Cranbourne West at a really good price earlier this year (2 weeks later same condition house on a same block sold for more than $45000 than mine). Cranbourne west (cranbourne) has been so strong for the last 12 months.
Median price almost 100k up and still going nuts.
Cant believe now you have to pay over 500k for average 3 bed house.
It has been only 8 months and similar houses are selling about 100k more than I paid.
Original plan was selling the small block house (less than 300m2) and upgrade to over 400m2 house in the same area. However the price has gone up so fast and the gap is now bigger than a year ago.
Should I hold it until I see 600K median price?
Or should I sell it after 12 months holding, making over 100k?
Cranbourne west median just hit $500k from $400k a year ago. (25% up)
Do we see 600k mark in the near future?

 

Cranbourne has done well because there is a huge amount of investor activity - we have heaps of clients that have purchased in Cranbourne over the past 12 months. Im not sure if there has been a "lets hype Cranbourne" thread but its done really well.

The general question though is lending and how is going to affect different markets/suburbs. I think investor suburb areas are going to get hit hard as people are going to struggle with servicing which in turn makes it hard to do equity releases and use as a deposits for purchases. I do think that the sweet spot is sub $750k mark for both investors and owner occupiers. VIC and NSW governments are giving decent grants for first home buyers. I personally think this will go further in VIC than it will in NSW (specifically Sydney Metro). Anyway dont want to digress from talking about Cranbourne specifically but in one sentence I would say its going to have stable growth still but its not going to go gangbusters due to lending/servicing restrictions.

I would only sell if you think you can convert your money into something better.

 

Take yiur money down to phillip island
Its only started movung in the last 6 months so you wouldnt of missed too much
At end of last cycle it was much more expensive than cranbourne and now its cheaper

 

Actually I have been looking at Cowes and Cape Woolamai as well.
Still very affordable with great value and potential.
I dont think it will do better than Cranbourne area in the future though.
Just for lifestyle choices
Cranbourne is a huge area. With 100% population growth in Cranbourne west for the last 5 years, I believe owner occupier rate is way higher than investor sector.
If you look around the cranbourne area, it can't go back.
Frankston/Carrum Downs/Langwarrin/Skye are getting stronger and Narre Warren(south)/Berwick is running away. Cranbourne area will be the only affordable suburbs in SE for the next a couple of years.
New estates in Cranbourne west is brilliant. It will be an absolutely different story in 3 years time.

 

Maybe who knows?

Theres plenty of expensive holiday/weekender spots in nsw so i think anything within reach of melbourne is a pretty safe bet and they always seem to go up after the city has boomed
Historically weekender locations were always valued a bit higher than yiur cheaper city suburbs but it could change.
I guess in a few years we will know the answer

 

I was talking to a local agent today and he was very positive about the cranbourne market next year. I have seen some houses under 500k snapped after the first inspection and put in rental market right away. However, I am not sure about the cranbourne boom has been led by investment movement. Casey has the biggest population, over 300000. When people are priced out from Narre Warren/ Berwick etc, only pakenham and cranbourne are their options.
When surround areas hit 750k, I think all the owner occupiers will rush to cranbourne and pakenham when they have to buy the house to live in.
Do you still think Cranbourne area is basically investor suburbs and
it will still have around 600k wall in max?
It has 25% of rental properties, I wonder if it is high rental ratio for the suburbs.
In my budget, cranbourne west is the only place I can see the potential to upgrade to.

 

I bought a 3+1+1 home on a 626sqm block in Cranbourne west few months ago. It was settled on last week of October and tenanted since week 1. The house is not so big however I am getting 350 pw. Happy with the rental for a $433k house. I know that I bought on the peak however I still think it has a lot of potential to go around $550k to 600k mark in few years time. They are now selling 450sqm land for $400k in the area and can't see any established house with 400sqm land below $450k. Still going up?

 

I believe you got one of the best buys this year in Cranbourne, just for the size alone!
It was not the peak at all after all if you bought that 6 months ago.
The median has gone up by 70K for the last 6 months.
300m2 average 3 bed house is now btw 475k and 520k.
The suburd record sale was out yesterday - $915000 (465m2)
I am sure we will see 1M mark next year if nothing changes.
If the first quarter next year is strong, it will be hard to find anything under 500K.

 

I brought my first IP in Cranbourne 2yrs go - 4 bed, 2 bath on 653m2 for $400K.
Personally I went for the old style brick 1980s house and avoided the new build areas like the plague. It's been rented the whole time at 370p/m and I've been able to use 50K equity to buy my second (now going the other side of Melbourne to Geelong). Good luck!!

 

Hi Becky,
I understand the bank evaluation is pretty conservative but for 422 on 653m2, the market value should be more than $520k by now. You could use 50k equtiy only??

 

Hi there, that’s a good point! Ubank valuation was $485 but I’ve decided to go with reduce home loans now so perhaps valuation will be greater?
I’d already saved 75k deposit and am now realising I probably have enough to buy another house in a couple of months! (Only just learning the reality of compounding growth!!!).
I was going to wait to draw the remaining equity but do you reckon I just draw it all now and park it in the offset ready for when I buy house 3?

 

I have just started studying the market myself. I am not in the position to give anyone any advice lol. I have been working on Casey area for months where I could see the potential for the next a couple of years. CW was my start and I am extremely positive about the future atm. 422 on 500~600m2 in an old area in CW is my next goal as I can see 600k~650k range for those houses in the near future. Good luck with your plans (for the number 3)!

 

Can anyone recommend a good BA for the Cranbourne area?