Hi everone,
I was talking to an RE today, when the subject of cheap properties was raised, with him making particular reference to areas that were once predominantly Ministry of Housing Commission homes. The RE was adamant that investors “should never buy ex-housing commission properties, as they will always attract poor quality tenants”.
Can’t say I totally agree, my hubby grew up on the out-skirts of a Housing Commmission area, and over the course of 30 years, this area is now quite “upmarket” and prices of homes there are anything but “cheap”!!!!!
Ahhhh change…..it is a good thing!!!!!
JO
I don’t know the Melbourne market so can’t comment specifically on that. But my experience doesn’t agree with the RE’s thoughts.
I think it depends on what is planned for the area and what you plan for the house.
I wouldn’t rule the idea out completely based on the RE’s opinion, research it and then decide for yourselve. Some of the biggest gains are made my people not following the herd. As long as your research gives you good reason not to follow the herd.
Let us know what you end up doing.
Regards
PKWe bought an ex-[biggrin]housing commission home in VIC back in 1996. Been a great little cash cow ever since we moved out and rented her. Paid $32500 at auction and approx value now is $120 000. Been cashflow positive the whole time @ $120 p/w.
Never had a problem with tenants. Area is now quite sort after as it is in town and near facilities.
You will always miss 100% of the shots you don’t take!
Hi Monopoly,
Some of those Housing Commission areas in Perth have had huge (many above other suburbs) gains in recent years with urban renewal programs in place.
WA government has adopted a policy of spreading housing commission tenants around Perth and as a result the ‘old cheap’ suburbs are now largely being redeveloped in a big way.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
We looked at the H/C area several years ago and could have purchased for round $80,000. Decided against it as the whole area was a bit untidy. Since then it has improved and prices have more than doubled, you couldn’t buy under about $200,000. But rents were never much good. There are still the untidy parts but a lot of homes look good and have had improvements.
Also heard of someone who was in the know, bought a number of H/C properties really cheap over some years, did a bit of work and rented them out. Now with the big price increases in the area, he has done really well.
Anna
Hi Monopoly
I have purchased in “ex-housing commission ” area in Perth.
Have had minimal problems with renting out infact have had excellent clients and always rented. Have had phenominal capital growth, better still. I have my eye on others now.
I am surprised with RE comments. As there has been great media hype (in Perth anyway) regarding the benefits of these kinds of property.I just wish I was smarter to have recognised this much earlier.
Hi all,
Thanks for your ocmments re the value in ex-Housing Commission homes.
I totally agree!!! I am not against buying ex-HC homes, and believe that if they are in a good growth area……why the heck not?????!!!!
The RE rang to tell me about me a “bargain” in Mornington (which BTW hubby and I purchased in about a month ago) and when he told me the price he was quick to “reassure” me it was not in a HC area or was an ex-HC property (not that I cared either way!!!!!)
I don’t doubt for a minute that HC homes have value in them; I have seen this happen to areas in different parts of Victoria, and I would assume (as you all have confirmed) the trend is across the board.
Many thanks for your comments, and don’t worry if I find a “bargain” I will snap it up regardless of whether it is ex-HC or not!!!!
Cheers,
Jo
I have bought about 4 ex housing commission houses and done well.
One of my friends bought one in Sydney and sold 18 months later for $150,000 and her sister also did similar.
In NSW, it appears the housing commission houses are slowly being sold off. I assume they are trying to spread the tenants out over many areas rather than concentrating them. If this is the house, areas currently with the stigma of being housing commission areas will gradually change, and there could be some good growth in years to come.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
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hi jo,
we have one IP ex-housing trust home and another on the way (not sure of the sex,he he) they are both in country SA and from my experience (i used to paint housing trust homes) i would definetly want to find out about the area from a local as, with every town, there are good and bad areas and some of the areas that i have worked in, i wouldn’t live there if i was paid too and nor would future tenents that are familiar with the areas. we are lucky in that our IP area has mostly been bought from the trust and is now either privately owned or by government for teachers/police etc. in the town with our IP we know the areas because we used to live there, but for an outside investor, to discover the good from bad can be quite easily determined by the huge price differences from the good (i have seen both halves of maisonettes in “bad” areas go for almost the same price as for a single half maisonette in a “good” area).another good indicator is if there is half a street of “empties”-why?
don’t know if this helps, just thought i’d put my two cents worth inWe have four ex-trust houses purchased in 3 different areas of SA and all are trouble free and CF+. I would not hesitate to recommend these properties but due diligence is required. We are now about to invest in another two, three or four.
Cheers,
Spodge
OK Spodge, very interesting but will the next 3 or 4 be positively geared, very interested in answer. I am guessing NO….. and if YES, where exactly….?????????
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