VIC Whittington & Newcomb (Near Geelong)

Well, Newcomb certainly is kind of experiencing a bit of a boom, and today fellow Property Chat member Ash and I met up and kind of got a first hand example of the power of this when we attended the auction at 4 Cheltenham Rd today. Bearing in mind that the fully renovated 1 Cheltenham Rd sold for what was a Newcomb record price at $530K back about a year ago in March '17.

1 Cheltenham Road, Newcomb, Vic 3219 - Property Details

Compared to Number 1, Number 4 over the road was a kind of unique 40's brick build place, one of Newcomb's first houses i'd suggest since almost all of the ones in the areas nearest to Boundary Rd (including my Mum's) are post WW2 weatherboard places.

4 Cheltenham Road Newcomb Vic 3219 - House for Sale #127526274 - realestate.com.au

Anyway, for this house which attracted an auction crowd such that i had to park in nearby Breadalbane St, the opening bid was $450K, and with the aid of four bidding parties, zoomed past the 500K mark to it's eventual sale price of $555K. Admittedly the land area of 768m2 would have been alluring as well, but that price seems to now indicate that the once great chasm of price differential between East Geelong and Newcomb has now melded together to some extent.

And in addition to this, 1 Cassia Ct, one of the plentiful and standard 60's brick commission style places, like the one David Shih bought around a year ago for what was a then snappy $270-$275K or so was priced at $350-$380K, and Ash was advised that the offers had exceeded that upper limit. There was only about a handful of properties in the area for sale yesterday, so most certainly this is now a rather hot market. This article in the Geelong Advertiser too also highlights how short the time on market is nowadays for non-auction properties in the Geelong area.

Corio — fastest selling suburb in Geelong after big decrease - realestate.com.au


Suburb Median days on market Same time last year Difference
Corio 13................... 47 -72%
Lara 14.................... 30 -53%
Grovedale................ 16 24 -33%
Norlane ................... 18 39 -53%
Marshall................... 21 45 -53%
Waurn Ponds.............. 21 33 -36%
Newcomb ................. 22 21 4%
Whittington .............. 22 49 -55%
Belmont ................... 25 38 -34%
St Albans Park............25 46 -45%

I'm just spewing a bit that i never had any way of acting upon these hunches of mine when i started posting in 2015...but i am grateful for the buoyant market that has seen some gains for my place in Norlane and Mum's place after all this time. Young investors like Ash, David, Josh, GTown, Lions4Eva and many others i have met on these forums, will do so well by the time they crack the half century that i'll be doing soon!!

 

I'm also spewing I didn't manage to snare a property in Newcomb last year. Went to a few auctions and couldn't bag one. Now those prices I wasn't willing to pay at the time have been well exceeded. Ended up buying in Norlane.

 

In all fairness 1 Cassia Ct has bigger land component than mine...600SQM vs 520SQM, so would've costed a bit more anyway. Also third bedroom already in place. Otherwise the conditions inside are the same.

But yeah I'm constantly amazed at how quickly Newcomb took off and keeps exceeding expectations, just like how quickly AirAsia decided to start taking off at the Avalon Airport once it turns into International

 

I remember saying at the time that your purchase may have been one of the last in Newcomb under $300k and I think that's been pretty accurate! There has been great growth over the last 6-9 months!

I'm very happy with the purchase I made in Whittington although it's hard to find good camparables I think it's definitely grown nicely!

Let's just hope it continues for at least another 12 months

 

I think you need to start charging for the tours of Geelong @Dave3214 if things go well maybe even get yourself a minibus to maximise your profits

 

Haha yea I remembered you said that too - and it wasn't that long ago!

And it's amazing how quickly the price on my Newcomb map is outdated. At time of drawing left of Wilson Rd is about 350 - 400K, and east of Wilson Rd is still around 300 - 350K range. Now they've all got another 50K on top.

At least the key area/concept still applies

Did you managed to get another one after Whittington @Brendon? From memory you were looking at Corio last year.

 

No I just bought the one in Regent st, started sniffing around Corio but it had already started to move and didn't really like it or Norlane when driving around the area. I know there has been a good amount of money made there but it wasn't for me and I ended up going in a totally different direction.

 

What do you guys the experts think about Lara, espacially after Avalon airport was granted the international permit?

 

I think Lara's still affordable compared to other similar areas. It's got a train station that most (if not all?) VLine trains stop at. Nice little town that feels much safer than say Melton for instance. Melton fits the billing of Dodgy Central.

 

Here's the article in the Addy about that 4 Cheltenham Rd auction.

Buyers ‘go crazy’ for Art Deco Newcomb house at auction - realestate.com.au

 

Hello I was wondering with these Geelong houses they mostly rent for $300 per week so how do I meet me my mortgage costs which could be roughly $400 per week ? Does it work out cash flow neutral after all tax deductions or is it better to rent the rooms out individually for say $150 per week ? Thank you .

 

No...it'll be mostly negatively geared, especially if you purchase an old house in 2018 as prices have already gone up to some extent. I bought mine last year for $272K and is now renting at $300/week so entry price is important to keep the portfolio not too negatively geared.

If you want to lease by room you can try...though I'm not sure whether there is demand for it in Geelong to be honest. Near Uni/TAFE/hospital maybe, otherwise I can't see how it would be feasible. On top of that PMs won't lease by room so you'll need to source and manage tenants yourself and that'll be quite a bit of work for seemingly very little reward.

 

ok thank you it makes sense. I spoke to a mortgage broker and he said i can borrow $350,000 for a ppor or $400,000 for 95% lend investment property. I want to buy an investment property first but if its not feasible would it be smarter to buy a ppor in say Corio first then us equity in that to buy investment later. my income is around $46,000 per year and i work at crown in melbourne

 

I was also considering a 2 bedroom unit in Werribee as a first ppor but i thought it would be better to buy a house on land in Corio because it would have more future potentional, I dont mind driving from Corio everyday to city although Werribee is much closer..

 

Read a recent article that was showing that Newcomb had the largest growth in the area (around 30%), but you think I can find that article now... was possibly on domain.

Failed at a few newcomb auctions 12 months ago cause I thought 350k was high.. Congrats to anyone who got in before the boom

 

Found it
Geelong’s property hot spots include Newcomb, Norlane and Corio

Top 5 fastest growing median house price (Source: REIV)

Suburb Median house price Annual change
Newcomb $416,000 34.2%
Norlane $330,000 34.0%
Corio $337,000 30.4%
Breakwater* $363,000 30.1%
Manifold Heights* $791,000 27.6%

 

Yes, lots of people deploy the strategy to buy a PPOR first and then over time as PPOR has had some growth, then extract equity to use for investment purposes and go purchase IPs from there.

Couple of considerations:
1. Not sure where you are living now, but be mindful Corio hasn't got the most desirable demographic in VIC. If you haven't lived there before and this is going to be your PPOR for the next however long then I would suggest maybe rent first at Corio to get a feel of the neighbourhood, accessibility and commuting time to your work before purchasing as PPOR.

There are certainly good and not as desirable pockets within Corio to watch out for. I've drawn out a map before so hopefully that'll help you avoid the rough areas.

Corio Map (with Mark Up) by David Shih posted 3rd Dec, 2017 at 11:09 PM

2. As @Chill2205 posted above, Corio has grown 30.4% in the last 12 months so just be cautious about how much more steam it still has left. I would start to play a bit conservative and don't have the expectation it'll have another 30% growth within the next 12 months. (If it does then that's extra cream on top for everyone! Certainly would hope that'll be the case )

Yep, agree with you on purchase house with land component over units any time. As long as you and your family can live with such sacrifice then all is OK

Cheers,
David

 

yea you are right I grew up in templestowe and living in a sharehouse in templestowe lower . I don't think I would adjust to the demographic there lol . I noticed there's a Metricon house for sale in the Flinders park estate for $360,000 on 250 sqm . It would be good to live In but don't know if it would be worth renting out . I heard many commission houses have been damaged in the area ....!

 

Yep, so definitely be wary of the demographics there...try before you buy to live

Also for $360K if you can get something on 600SQM in Corio, why would you want to get something on 250SQM? Land is the one appreciates over time so be careful here, don't get tricked into buying those brand new homes on super small land. Buy existing and you can spend some money to renovate inside instead if you end up living in there as your PPOR. Otherwise if for investment just do the minimum tidy up in order to get a tenant.

Cheers,
David

 

yea i probably would go with the bigger land if investment, but not sure if i was living it but ive been in old sharehouses and i always find it depressing you know what i mean? at least the the new one everything is nice and there shouldnt be many maintenance problems compared to those old dumps...