Where’s the value in places on tiny land?

Discussion in 'What to buy' started by Nina00, 7th Jun, 2021.

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  1. Nina00

    Nina00 Well-Known Member

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    I’m noticing places on small land selling for high prices. I’m talking on land of 250m2 and smaller. I remember not that long ago everyone telling me that the value is in the land, not the house and to make sure I buy something on a reasonable amount of land (not huge but bigger than 250m2!).
    So where is the value in these tiny places? Do people really think a place on tiny land for about $850-$900k is good value? I’m not talking prestigious areas but average places about 30kms from cbd.
    I certainly don’t but I’m no expert and none of this makes any sense to me.
    I’m confused and gobsmacked by what I see selling and I wonder if there work be a consequence down the track.
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    In the much larger block which was subdivided to yield the maximum number of lots permissible under the LEP/DCP.

    The developer bore the risk to purchase, rezone, construct roads, extend services etc to earn a profit.
     
    Last edited: 7th Jun, 2021
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  3. Nina00

    Nina00 Well-Known Member

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    But I don’t see the value for the person that is going to buy it to live in it. Isn’t it quite the rip off?
    Minimum land value and can’t extend the property. Some are even joined to their neighbour by a wall. Yuk
     
  4. Gockie

    Gockie Life is good ☺️ Premium Member

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    Don't buy these. If its 3-5km out from Sydney City, no problem. But 30kms from city.... no. You have much better options.
     
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  5. Scott No Mates

    Scott No Mates Well-Known Member

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    It's only taken 150 years for the value to be realised for the small inner-city blocks.

    @Nina00 - be prepared to wait another 150 years for you to see any real value in those outer suburb blocks.
     
  6. Hebro

    Hebro Well-Known Member

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    compare to townhouses, apartments in the locality - is the small lot offer much better?
     
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  7. Nina00

    Nina00 Well-Known Member

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    I’m talking Melbourne and these are popping up EVERYWHERE. It seems to be the thing to knock down a house and build units or townhouses. Even in places like Kilsyth and Boronia!
     
  8. Scott No Mates

    Scott No Mates Well-Known Member

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    The developer obviously did see value & has realised it through subdivision. Developer doesn't have much interest as to whether the end user will make money from their investment other than ensuring that the blocks are priced to sell.
     
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  9. Firefly99

    Firefly99 Well-Known Member

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    It’s valuable to people who can’t afford a bigger block as it enables them to buy a house. But yeah, not my cup of tea.
     
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  10. wylie

    wylie Moderator Staff Member

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    There are plenty of people who want a small yard, courtyard even, rather than a yard and garden. People with small children who don't need a big yard yet, or those who are past the children years, or don't have any.

    They don't want much (if any) grass to mow, want a nice outdoor entertaining area that flows from the living area. They want to be close to work, or close to transport to get to work.

    We had two such houses, each on 900 square metres. Tenants often baulked (or walked) at having to spend half a day mowing each week, so we included mowing in the rent for years until we developed the blocks, and built townhouses behind them. The houses now sit on tiny blocks but will sell easily to someone when we decide to sell them, who is looking for the things I've mentioned above.

    Also, it allows people townhouse style living without having to deal with body corporates or neighbours who have any sort of say in how they live their life, or have to ask permission of a committee to do anything.

    This is inner-ring Brisbane.
     
    Last edited: 7th Jun, 2021
  11. The Y-man

    The Y-man Moderator Staff Member

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    A good consequence if you own a house with a decent block of land on it, even if it is 30km out of town!

    The Y-man
     
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  12. Nina00

    Nina00 Well-Known Member

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    but what if it’s on a tiny block of 250m2 or less?
     
  13. The Y-man

    The Y-man Moderator Staff Member

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    250sqm or less is fine within the 20km range. At 30+km I would be looking at 600+sqm

    Having said that, there are many places I don't know about even in my own town.

    The Y-man
     
  14. craigc

    craigc Well-Known Member

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    Hi @ Y-man,

    Just a quick example of where a well located example of the above can still work.
    Walk to shopping centre and no great PT in Rowville but an area 31k’s from CBD.
    Eg is Townhouse on 300m that’s almost doubled since including brand new purchase price premium in 2009.

    https://www.realestate.com.au/property/webview/12-braeburn-pde-rowville-vic-3178?client=iphone

    I am aware of this development as saw these being built new at the time.
    Note I am certainly not recommending buying them new OTP as a good investment. But after the ‘newness’ premium is gone, seem to be solid performers with decent yield (for Melb anyway).
     
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  15. Piston_Broke

    Piston_Broke Well-Known Member

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    The value is that it's a family home. And that value is huge.

    As for the value, I remember newish free standing houses 3-2-2 selling in Coombabah for 140-160k.
    They are now 550k+.
     
  16. skater

    skater Well-Known Member

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    So don't buy one. Nobody is forcing you to buy something on a tiny lot, you know.
     
  17. The Y-man

    The Y-man Moderator Staff Member

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    Nice! I've never understood Rowville (I have friends who lived there, and worked for 20+ years up the road in Mulgrave). Maybe I just never picked up on the fact that the 900 and 901 run through it acting as connectors to the rail, as well as now the Eastlink. Then there are all the industrial employers on either side (Bayswater to the north, Dandy/Clayton band to the south/west)

    The Y-man
     
  18. craigc

    craigc Well-Known Member

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    @The Y-man - probably mainly as spill over suburb from Wheelers Hill, Glen Waverley and Mulgrave with green wedge in between (Jells Park etc).
    Close to working areas you mention and close access to Lysterfield NP, Dandenongs and now Eastlink.
    Main negative would be PT as mentioned.

    Short summary apart from Wikipedia :)
     
  19. beachgurl

    beachgurl Well-Known Member

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    It's about affordability. Some people want to live in the new suburbs but have a limited budget. They are the ones buying the tiny blocks.
    Or one who shall not be named in here has done well doing the same.
     
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  20. Nina00

    Nina00 Well-Known Member

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    oh ok then
     

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