guys
what are your opinions abt the Victoria Tower Highrise in Southbank, Melbourne.
CentralEquity (the builder) are fiercely marketing to sell their apartments to potential investors in the UK.
Price (off plan):
$419,000 for 2 bed / 1 bath
$459,000 for 2 bed / 2 baththey are guarenteeing rent for 2 years (-ve cashflow), and also arranging mortgage with CommBank
whats the catch here? are they not able to sell it to locals?
You got it in one with your P.S.!
They have been trying to sell these apartments as far away as Washington and NY. When I was in the BA last year, I couldn’t believe it when I saw their display suites.
Just on a hunch, I got a friend to check the resales of their apartments to see what happened to buyers who had bought from them in the past.
Suggest you do the same. It’ll be a real eye-opener for you.
Cheers
Bec
P.S. And we’re not all “guys” in here, either, especially the smart ones!
As a person who lives in the UK, central equity have always aggresively advertised in the UK.
I must say I have little experience in property investing but I would personally stay away from these deals. Their are to many apartments in melbourne for demand, this may change but as it stands I do not think now is the time to look at these.
One thing I have learnt is never buy proprty brand new as the price asked for these properties is not the market value, it is a combination of market value and the builders profits.
Hope this may help
Rob
Great comment Rob. Smart guy, but then you’re in the UK.
Bec
Rebecca, gee, glad to see being in the UK makes me smart
I am looking at buying an investment property in Melbourne and originally did look at Central Equity, who can fault them for their advertising but when I got their figures it just did not add up.
As always do your own due diligence but anything that sounds good is usually not.
Good question to ask them is what happens after 2 years, how much do you think the rental I can receive from the property is? They pay for your rent through the high prices you pay for their properties.
Rob
my advice – stay away from from the city apartments – especcially in the Docks – they have something like 3000 apartments going up there. Central Equity and Mirvac are going crazy with their developments and the apartments have dropped in value and will continue to drop because they are simply way way over supply.
Kind Regards,
George.“If You never never ask, you’ll never never know”
Madankumars,
You ask what is the catch, but you have mentioned the price. Don’t you think that price is expensive? 419k for a 2-bed apartment? Does it come with a security parking space? What is the rental guarantee in terms of percentage? What are the body corporate fees? What is the median rent for the area *after* rental guarantees have finished? Check that out on an ljhooker site in the area.
Look up google.com.au and type in “southbank melbourne” in the google news section and see what comes up.
kay henry
Madankumars,
What sort of rental guarantee are they providing? I know the area quite well, as I live in the area. I also own an apartment in Sth melbourne close by so I am well-versed in both rentals and re-sale values.
What is the size of the apartment?
Car park?
Body corporate?Some background information. they have been selling/marketing these apartments to the US & UK for at least 2 years.
The phenomenon originally started by selling them to investors in Asia (especially Hong Kong). This has been happening for the last 6-7 years (right throughout the property boom as well). So selling overseas is nothing unusual.
Like houses, one apartment is very different to another. Finishes, size etc. However, you will find that many of the re-sales now take a very long time to sell at a range that the vendors are looking for.
There are two examples that I know, whose apartments have been on the market for close to 10 months trying to sell them (Central equity buildings). They are obviously not that desparate to sell though. The asking price on one hasn’t come down that much, but another’s asking price has gone from $415k to $379k.
James
I saw a renovated weatherboard house on the weekend on the beachside in Parkdale a surburb of Melbourne for around $520k. Parkdale is about 22kms from the city on the beach. The place was 2 mins walk to station and shops. About 5 mins walk to beach and walking distance to great schools.
For an extra $70k, I tell you what I would choose. And it aint an apartment that needs to be marketed overseas to make sales.
There is nothing wrong *per se* with marketing properties overseas. It’s just tapping a market. As with everything though, one would do their checking. The net makes it possible to check out everything. One wouldn’t just buy a place because it is advertised. Spending 419k is a LOT of money. Do your checks and then make your decision.
kay henry
All I am really saying is that its expensive to advertise overseas.
If the locals buy your product, then you dont need to go to the expense of marketing overseas.
Its like my trip to the Gold Coast last year. All the marketing companies are trying to sell to interstaters or overseas people.
When I told them I would rather buy a similar property second hand from a real estate agent, they backed away knowing they could not compete on price.
Originally posted by madankumars:guys
$419,000 for 2 bed / 1 bath
$459,000 for 2 bed / 2 bathThose prices are about double what I think they’re really worth!
Though Southbank is near the CBD it can still be a fair hike. A good suburban location within 5-10 min walk of a supermarket, local shopping strip and the station I think would score better. Yack’s example of Parkdale sounds pretty close to that and there’s the beach as well!
For about that sort of money you could get a house in a handy Melbourne suburb, two houses in Perth or four highly rentable houses or units in regional cities.
Though you won’t get as many tax breaks, any of these I think would have better long-term prospects, lower risk and for the regional properties much higher yields.
Regards, Peter
Thanks, Bec for the explaining literal interpretation of the word “guy”.
Perhaps, as you’re in the UK, you could explain the literal meaning of pork, hump, root or shag as I think I might have be misuing these words…
Just to add 2 cents!!
Builders if are unable to off load to public , they sell it to Defence Houising at much higher price. Then Defence housing sell those properties with 9 + years lease. Has any one had any experience recently (last 1 year) in buying defence housing property.
Sati
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