Hi everyone
I’m a new member of this forum and also to property investing. I would like to hear some feedback regarding my current situation.
I am planning to buy an under 200k investment property and have narrowed down my choices to:
1. A one/two bedroom serviced apartment (managed by Unilodge, College Square or Quest Apartment) in Melbourne CBD
OR
2. A two bedrooms Unit or House in Frankston area
My short term plan is to build enough equity for me to buy my first home in the next 2-3 years somewhere in Melbourne Metropolitan area preferably the eastern suburbs.
Based on your experiences, which do you think is more profitable and align with my objective? Please feel free to suggest any other investment strategy that you think is more achievable.
Your help would be greatly appreciated!
Many Thanks
Juliana
History tells us that land content is the factor that drives cap growth the most.
With serviced apartments there are very high maintenance and management costs, and no chance to add value through reno/subdivision etc. A lot of the investment is out of your control. Some don’t mind that; I think it’s risky.
Crunch the numbers on holding and maintenance costs versus rent return, then factor in possible cap growth and I think you’ll find Frankston is the winner. (We are already invested there and live down the coast a bit, so know the area very well).
One more thing; Banks won’t lend on serviced apartments if they are smaller than 50 sq/m, so check that too.
Cheers,
Marc.
[email protected]“we get sent lemons; it’s up to us to make lemonade”
Thank you very much for replying, Marc.
I do heard that Frankston has a good potential, I was wondering if you could give me some pointers on what do I need to be aware of when choosing a property in Frankston? I really hope I could still find a +ve or at least neutral gear property out there. Is there any other website/place that could help my research besides the council website?
Any help would be appreciated. [biggrin]
Cheers
JulianaHi Juliana,
You can get some information on Frankston from the following post
https://www.propertyinvesting.com/forum/topic/26604.html?SearchTerms=frankston,anyone
If you search the forum you may be able to find some more posts.
From what I know of Franskton, you will find it extremely difficult to find a cashflow positive or neutral property. However, the area seems to be generating good demand and therefore capital growth is not out of question. Properties with subdivision potential are definitely in demand.
I agree with Marc on investing in serviced apartments. On the surface the deals look good but you really need to consider all costs and also consider the low(er) capital growth.
Hope this helps and good luck with property investing.
Sanjiv“There is no passion to be found playing small – in settling for a life that is less than the one you are capable of living.†– Nelson Mandela
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