All Topics / General Property / Adelaide investment property

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  • Profile photo of Andy BAndy B
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    @andy-b
    Join Date: 2010
    Post Count: 9
    March 1, 2011 - 4:03 pm

    Hi everyone,

    I live in Adelaide and am currently looking at purchasing a 2 bdrm CBD apartment on York St (East End) with no carpark for 300k currently returning 350 per week (body corp 600 per quarter) using a 20% deposit as an investment property. Obviously the rent return is reasonable for a place which needs no work. My only concerns are in regard to capital growth when it has no car park and saleability although i plan to keep it for the long term. Does anyone have any thought on this investment.

    Profile photo of Jamie MooreJamie Moore
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    @jamie-m
    Join Date: 2010
    Post Count: 5,069
    March 1, 2011 - 8:30 pm

    Hi Broke Investor

    Are their public transport options nearby? Do you suspect that the rental market your targeting would prefer a car space? If so, you’ll be restricting yourself to a small pool of tenants without vehicles (students come to mind).

    Also, the next person to purchase the property after you is likely to have similar reservations – this could have an effect on capital growth.

    There was a similar thread recently – I carried out a quick search but couldn’t find it (you might have better luck).

    Cheers

    Jamie

    Jamie Moore | Pass Go Home Loans Pty Ltd
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    Profile photo of Dan42Dan42
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    @dan42
    Join Date: 2008
    Post Count: 619
    March 1, 2011 - 10:45 pm

    I personally wouldn't buy an Adelaide CBD apartment, because of the capital growth concerns and the lack of a carpark. For $300k you could buy a nice 2 bedroom apartment in the inner East (Norwood, Dulwich etc) with a carpark which will rent really easily.

    It also will cost you a lot less than $600 per quarter for the body corporate fees. The rent will probably not be as high as the CBD apartment you are looking at, but I would think the capital growth would be better.

    Profile photo of Andy BAndy B
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    @andy-b
    Join Date: 2010
    Post Count: 9
    March 3, 2011 - 2:02 pm

    Hi Jamie, there is plenty of public transport nearby, near all the city unis, the tenant has been there for 4 years which says something good about it and its near plenty of bars and restaurants.
    I could buy one with a car space but for about an extra 80k.

    Dan42 I live in Norwood and have been looking for 2 bedrooms+carpark in norwood and dulwich etc but there are very few with any change from 350.

    The biggest problem i face is that due to high debts on PPOR i cant get any new loans or refi so i have to really on selling an apt in melb to purchase this one subject to sale and substituting the security on the existing loan, leaving money to offset and cover future costs. Im lucky enough that they are happy to wait for the sale but i cant foresee being able to find the right place in a short amount of time once my apt sells, or get a subject to sale accepted with a unit under high demand.

    So based on the fact it would be approximately neutrally geared i would be hoping for it to go up from 300 to 345-350 in 3 years and this is really the only question i have.

    Maybe i should ask the crystal ball.
     

    Profile photo of conniecconniec
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    @conniec
    Join Date: 2012
    Post Count: 1
    December 18, 2012 - 3:32 am

    Hi Andy,

    I am a Property Strategist in Adelaide , from i know the apartment in CBD is oversupply and the capital growth is very low and almost stop . One of my friend she bought an apartment at CBD 5 years ago with 2 bedrooms and car park price $ 310,000 ! up to now she is selling the same price but still waiting long for people buy .

    In my professional opinion , buying the CBD apartment is not a good investment at the time even though the rental income is ok. Also, there is no car park as well.

    I have a better recommendation to you , our company is doing a new project next year after Christmas ! We launch an 10 level apartment which located at million suburb , including swimming pool, gym, art gallery . I am sure you will think the price is reasonable .

    Please contact me for more detail Connie 0430 278 119 , [email protected]

    Profile photo of Nigel KibelNigel Kibel
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    @nigel-kibel
    Join Date: 2005
    Post Count: 1,425
    December 18, 2012 - 4:21 am

    Hi I would not by a cbd apartment in any capital city let alone one without car parking. I am sure the agent has told you how people dont need car parking. Once you have brought the apartment everyone will want a car park.

    Anyway capital grown on anything the the CBD of Adelaide will be poor, stay clear there are much better deals across Australia. Personally you would be better buying in inner city Brisbane, capital growth there should be strong over the next few years.

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