VIC Thoughts on Rockbank h & l

Ooii...... stop telling the great unwashed...we don't need the competition you know?

 

Lol, it doesn't matter how much I say it, people believe it's an inferior investment stratergy. Even though it's one of the only ways to get balanced growth and yield with the boost of depreciation. The only thing potentially better (other than full blown property development) would be doing dualocc/duplex H&L. The ole 2's better than 1.
Buying BMV and renovating is another good strategy but requires more skill. Any other strategy typically compromised either growth or yield for the other.

 

Agree mate........ isn't it funny people still don't think it is possible when other people are doing this....

 

Yes, but part of me agrees with your earlier comment, less competition.

 

Dual occ H&L is a great strategy and it's most likely what I'll be doing once I finalise my current projects..
Only problem I'm facing is finding a good estate (in Melb) without the usual single dwelling covenant.

 

Yes, I think there is more chance of this in WA and QLD. Vic developers don't like to leave anything on the table, but I have seen a few duplex lots from time to time. Some in Geelong at the moment.

 

I fell in the trap of billborads and tv lol. cant back out now paid deposit. before I bought in rockbank I dint know that melbourne is having like 20something estates and so much land. I didnt even look at any other suburbs to be honest.
last month I back out from a IP in Adelaide due to B&I report. if the report was good I would have purchased 7.8% yeild IP Adelaide by now... then saw the bridgefield ad and made a choice based on some day we will move to melbourne.

 

great to hear this .

 

fair point Tobe. I checked some sales data in Rockbank(established house and lands). old houses on big blocks well bellow 300k.I can just keep praying now that my one settles late and by then some good sales data coming from Rockbank.

 

banks and lenders are always unfair. have you read the new media release from planning minister VIC. rockbank will be home to 22k people with land set aside for schools etc. hopefully that will put some sense to valuers. as long as its not hugely undervalued I can cover 10-20k.

 

If a valuer was to be fair in his comparable selection (they are supposed to be fair), and if @tobe is correct that it has to be resales (not aware of this requirement), then it would make more sense to take a mid point between a comparable sale in Caroline Springs and a comparable sale in Melton West. This would likely be above you purchase price, based on my general knowledge of prices in these areas.

I think you will find that anything below $330k fora 3/2/1 is a good price in 1-2 years this will be pretty hard to achieve in rockbank. It's even getting harder to achieve in Melton. Impossible to achieve in Plumpton.

 

@Cactus thank you for the peace of mind.

 

Difference is those you mention are advanced investors. Not a bloke picking a new H&L out of a hat.

 

Advanced investors start with a single purchase.

 

Somersoft used to have a valuer member. Not sure if they made the jump to pc.

They have to use actual sales, and there aren't many between Carolyn springs and melton. They could use a sale from Carolyn springs but they would note it 'superior' as its closer to town, or amenities etc. they could note the sales in melton as 'inferior' because melton is further from town amenities etc, but they are noting them as 'comparable'.

Under valuing new estates isn't new, pakenham, officer, Cranbourne were all valued against their existing stock of old weather boards on big quarter acre blocks when new development started. It's not every valuation, But it's much harder to argue a valuation when there aren't a lot of comparable resales in the immediate area.

 

Banks aren't unfair. They just always have it their way. The bank always wins.

The trouble with most early sales in new estates is they are crap. It's new home makers selling up due to divirdmce or de bank, and not holding out for a good price. And why would a buyer pay over the odds when they can build their own shiny new home just down the road in the next release and get the discount of stamp duty and the first home owners grant?

It's rare for new estate stock to increase in value for at least 5 years, until the neighbouring suburbs are built out and the amenities are finally developed.

This isn't my opinion btw, just my experience doing h&l finance.

I'm sure they rent well, have good depreciation, attract good tenants and are easy to repair and maintain. The land people bought around Berwick has done alright over the last 10 years or so. Not sure of many other examples of capital growth outside the norm.

 

Start with a strategy too.

 

Our friends couldn't sell their double story 2 year old place in Berwick. Not so sure about CG

 

Really can't imagine why. Berwick is like the Brighton of the outer Sout East. The growth and demand there has been very good over the years.

 

Not always. Some of the most successful on here admit to not having much of a strategy. Just buying when they could afford. The passage of time did its thing.

Not saying I advocate that. I think it's wiser to have a strategy.