NSW Wentworthville - still good option for investment

Discussion in 'Where to Buy' started by NWHunter, 5th Feb, 2018.

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  1. NWHunter

    NWHunter Well-Known Member

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    For Sydney, what do you think about the prices and rentals from the new apartments on Dunmore Street, Veron St, Garfield St etc? eg 3b apartment < 700k yeils 600-650$ rent PW.
     
  2. Property Twins

    Property Twins Mortgage Brokers & Buyers Agents Business Member

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    Have you considered the over supply of units? Some of the suburbs units are on lender restricted lists for LVR.
     
  3. NWHunter

    NWHunter Well-Known Member

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    Sorry, newbie here, can you please share more details of this concern?
     
  4. Property Twins

    Property Twins Mortgage Brokers & Buyers Agents Business Member

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    There is a lot of development happening in Parramatta satellite suburbs and there is an oversupply.
    Some lenders have restricted the LVR to be 80% i.e. you need 20% deposit to complete the deal due to post codes being restricted.

    Being OTP, you would be paying inflated price on the properties.
    Rent - I'd suggest confirming if they will really rent for $600-$650 pw?
    With Sydney being at the peak, what do you want this investment for you?

    What's your goal? Is this for investment or potentially owner occupied?
     
  5. L3ha7

    L3ha7 Well-Known Member

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    One of my colleagye is trying to rent iut his property in Toongabie from last 4 weeks but no takers and RE agent has dropped the price as well.
     
  6. virhlpool

    virhlpool Well-Known Member

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    There is a lot of new migration to the west. Majority of Indian immigrants and also that from many other communities prefer Parramatta and surrounding suburbs to live in when they first arrive and continue to live there until they end up buying PPOR in the newer/cheaper suburbs. Considering that immigrant flow hasn't slowed down a bit, I don't see any reason for rental demand to be weaker. In fact, new stock will be easily consumed if the asked rent is reasonable.

    Whether the rental yield and capital growth prospects make sense in current scenario or not is a differet discussion. But finding tenants shouldn't be a concern at all given that hundreds of new families settle in those suburbs every month. Well livable properties get tenants easily. Bad, old stock may suffer a bit as some of the units are in pathetic condition in those suburbs and owners/investors don't want to spend much on investing in repair/reno..
     
    Last edited: 6th Feb, 2018
  7. Wanderer_NSW

    Wanderer_NSW Member

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    Hi Property Twins,
    You have mentioned it twice about postcodes being restricted to 80% LVR. I know Parramatta has been highlighted as a restricted suburb but cant see Wentworthville being named anywhere. Can you provide such a list published from any lender? All I can only see are low to medium density apartment constructions being built there which wont cause a oversupply in my opinion. I totally agree with virhpool about the demographics of the suburb. Its a quite suburb with accessibility to everything from malls,hospitals,trains and T-way buses. My only concern here is that the words "Oversupply" and "Apartments" have become synonyms today with people not looking whether it actually exists in that suburb.
     
  8. Wanderer_NSW

    Wanderer_NSW Member

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    Hi L3ha7,
    Just one property which is not getting a tenant cant decide if a property 2 suburbs away will get rented or not. It also depends on where your property has to offer in my opinion.
     
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  9. Foxdan

    Foxdan Well-Known Member

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    I doubt those rental amounts are correct. They r likely just the developers giving inflated figures. You can rent a 4 bedroom home in much nicer surrounding suburbs like Baulkham Hills for that price.
     
  10. Gockie

    Gockie Life is good ☺️ Premium Member

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    I tend to think 3 bedroom apartments are in fairly high demand in most of Sydney. They tend to be tightly held, rarely sold, rarely looking for tenants. And apartments tend to be built closer to rail access than houses so they have that advantage too.

    Note, this is not specific advice.
     
  11. AAA2214

    AAA2214 Well-Known Member

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    Why do you want to buy in a suburb with oversupply of apartments? Rent quoted is high. You can get 500-550. With all the new apartments built, it might take 4-8 weeks to get it tenanted if you advertise for a reasonable rent. If you add strata, insurance etc you will have less yield too.

    Why will someone pay 650 rent when they can get 3 bed properties for rent in say homebush, strathfield, burwood at that price. These suburbs do have some Indian living there too.

    You should always look to buy properties which are in short supply. Say in Wentworthville, they are lot of new apartments built and if that trend follows, you should look to buy a townhouse or a smaller block of house and land. That way your property will be in demand.

    Did you look at Quakers hill? Maybe 10-15 mins max more from Wenthworthville and you will get livable 3 bed houses with around 500 sqm land or townhouses for around 675 to 800k. You can get 475-550 per week for sure with the land component helping with future value. Look for blocks with granny flat potentials. For higher rental yield you can always put in a granny flat where you can get extra 400 per week rent. Quakers hill also has Indian shops and Indians living there too. Just my 2 cents!
     
    Last edited: 13th Jun, 2018
  12. AAA2214

    AAA2214 Well-Known Member

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  13. AAA2214

    AAA2214 Well-Known Member

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    Here is one 3 bedder in Quakers hill which is under contract(things can change) in the first week of open home despite the cooler market. Should have fetched 700-750k. Also from the pictures looks like it has granny flat potential which is a bonus for later future add- Quakers Hill address available on request - House for Sale #128549578 - realestate.com.au
     
  14. Wanderer_NSW

    Wanderer_NSW Member

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    Hi AAA2214,

    I think the following graph of Wentworthville Apartment performance shows something else than what you are suggesting.Its been holding stable even in this slow market which presumably started mid last year.I assume supply is meeting demand in this suburb unless you have some insider details that we dont have. I think if you really need to understand apartment oversupply look at the graphs of Parramatta,Zetland or Sydney Olympic park. These suburbs have been ruined by their councils by approving all high rise apartment projects.

    FYI, source of this graph is Real Estate.
    Wentworthville Investment Property Market Data

    upload_2018-6-13_11-37-37.png
     
  15. AAA2214

    AAA2214 Well-Known Member

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    Sure but if you see the data from 2014 to 2018, the median price for units in Wentworthville has remained constant mostly around 580-610k even in peak Sydney market with current median around 610k. If there is demand, then the prices of the units should go up? In comparison, in the same period, the house value has gone up from mid 700 to above 1 Mil . So which one will you buy in Wenthworthville? Houses which will become scarce or units that are going to fill the suburb soon?

    The original poster was asking if this investment makes sense and based on the RE 4 years data there is no price jump or scope for future value unless there is something new infrastructure coming up there. Also the investment would be negative yield per month after all the expenses based on say 450-520 per week rent.
     

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  16. Wanderer_NSW

    Wanderer_NSW Member

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    Hi AAA2214,

    Please check the graph once again.Its 465K to 610K since 2014. Also the kind of growth Parramatta is going through in terms of jobs is only an indicator that its satellite suburbs will benefit from it if not BOOM. I know its been only in talks for a few years but if you walk around Parramatta you will get to know the kind of changes its going through in terms of job generation now.

    Major Development in Parramatta Triggers New Retail Property Trends.

    Also, Westmead is undergoing a major upgrade in terms of its hospital facilities.Inclusion of light rail is going to make things better if not worse.

    People priced out of Parramatta due to lending restrictions will definitely turn to Wentworthville and Westmead in search of good facilities and its closeness to everything.

    This might be wishful thinking but just my 2 cents
     
  17. AAA2214

    AAA2214 Well-Known Member

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    The unit prices jumped from 465k to 600k from start of 2014 to end of 2014. Thats shows the start of selling OTP properties which maybe are settling now. So 10-15k value growth from start of 2015 to 2018 sounds reasonable for investment? Naah.. I would run away from such properties.

    Also if you see the rental demand has dropped from median rental price dropped from 600 per to 420 per week in the last 1 year. Lot of properties coming on the market for rental? Definitely yes and thats what investors would like to avoid.

    Screen Shot 2018-06-13 at 1.32.38 PM.png Screen Shot 2018-06-13 at 1.29.32 PM.png
     
  18. Gockie

    Gockie Life is good ☺️ Premium Member

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    Can you do the charts for just 3 bedders?
     
  19. AAA2214

    AAA2214 Well-Known Member

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    Screen Shot 2018-06-13 at 1.53.43 PM.png
     
  20. Wanderer_NSW

    Wanderer_NSW Member

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    yeah, but my original argument still holds that there no oversupply of apartments in Wentworthville. Good option for a PPOR with everything within reach and its closeness to the Parramatta CBD.Only the next few years will tell whats going to happen with Parramatta getting beefed up with all the infrastructure,educational facilities and jobs.