Hi all, Been researching like crazy the last 3 months working out what is best for me in my current situation. Looking to buy an investment property in Sydney, up to the $700-$750k mark. Hoping to hold onto it for some time and see where it gets me, will hopefully not be in any rush to sell it. What would make a smarter investment to you? An apartment within 10km of the City or a house within 35km of the CBD?
B. Note, not exactly the right time to buy Sydney. But given a choice of A or B, I'd definitely go B. They can put up more units at any time... land is the scarce factor in Sydney. Otherwise. .. Hobart.
as many here will tell you, for 700K you could buy two in QLD or SA (or Hobart ). if Sydney is a must, i would buy a non renovated unit in one of the older appartment buildings near one of the unis, make the cosmetic renos and rent it out. the older buildings have large sqm and they are ~ 100-150k cheaper than the "new developments" my view only. house 35 km - u might as well go 70 and buy in wollongong.
Yield will not be fabulous if buying in Sydney at the moment. It is difficult to get yields above about 3%. That is not enough to cover interest on the loan, property management fees, rates, insurance, etc. That puts a drain on your wallet. In Brisbane, Adelaide and Hobart which are markets in a growth phase, you can find properties which yield 5% or better. This makes them cashflow neutral or positive. If you buy well and select a property that you can ask a good rent, you will likely have change left over after interest, etc.
Agree with Gockie, not the right time for Sydney full stop, but if you must, I'd go for something with land at this point. Other cap cities present beeter growth options for the short-medium term. Perhaps regional centres in NSW might be worth a look?
I would choose B out of those two options. Anything involving the words unit, investment and Sydney worry me.
If you were trying to make this decision 15 years ago (and you're not, you're trying to make it now) then it's a line ball call. The Blacktown house on land is marginally in front, but not enough to be of any note, if you see the graph comparing it to say, Marrickville units. To all those people saying it is not the right time to be buying in Sydney atm, I recall many saying the same thing this time last year. If you'd have taken their advice at the time, you'd have missed another 10% CG that we've had since then ......just sayin'
I bought in Sydney December last year... and Oct 2014... both considered in boom/post boom. Has worked for me! But it's not responsible to say to others to do that.
