Has anyone got any info on the Central Equity company. They have two developments in Southbank central Melbourne called “City Tower” and “Melbourne Tower” and they are pitching them at UK investors. Sounds like you average luxury highrise apartments/condos and they “guarantee” (love that word!) 5% return!
Anyone?
FeastI purchased a unit in 416 St Kilda road for $270K back in 1999 from central equity. I had a valuation done last year which came back at $330K – an increase of 22% in 5 years (not great!). I have consistently had it rented out at $1540 per month over that time, with little or no rent increase. The unit is OK, but last time I visited the agent said not to try bumping up the rent as there are a lot of apartments in Melbourne available at the same rent but newer. I had the rental guarantee and they did pay the amount for a couple of months initially until a tenant was found. I think the company is OK, but there is a glut of development in Melbourne units. I wouldn’t buy one at the moment as the rental return isn’t enough to cover expenses (and possibly unreliable once the guarantee runs out) and you won’t be getting capital gains either.
Hi Feast,
I suggest that you do a search of the forum using ‘central equity’ – the serach facility is located top left under forum boards button. The company has come up a few times before.
I would be very mindful of serviced apartments and rental guarantees – you will nned to conduct thorough research to ensure the ‘deal’ stands on its own anyway.
Together they can be problematic as there are sometimes when guarantees artificially inflate rates of returns making the ‘investment’ a little more attractive than market rates.
Some lenders are wary of inner city, small, serviced apartments. Due to perceived risks and dropping values and oversupply issues banks are reluctant to lend at 80% – most around 65%. As such these investments can suck up more of your cash/equity than they deserve making the next one a little harder to acquire.
Derek
[email protected]
0409 882 958
Property investment advice and researched property in quality locations available.Feast,
Be careful, I’m sure you will find a great deal of info on them if you do a search of the net (as Derek suggested). Although they may be reputable, bear in mind, Southbank has a surplus of high rise serviced apartments hence CG will be lessened and vacancy rates maximised.
Melbourne apartments are aplenty and as such I would not be buying into them for the present time. You can get equally good returns, albeit not “guaranteed” in other areas, lower vacancy rates and definitely with greater CG prospects.
Cheers,
Jo
Central Equity is a pubically listed reputable company. Unlike others is they commence a development they have the resources to complete it and they will honour their rental guarantees.
Having said that, would buying an apartment in one of their complexes make a good investment?
I think you could find better deals elsewhere.
They had a reputation of poor quality and thinh walls and this hindered resale values.
Also as Monopoly has explained, their is currently an oversupply of apartments in the near CDb region esp in Docklands and to a lesser extent Southbank.
You would get better growth elsewhere. Especially buying an older apartment in the bayside suburbs which would be bigger than you new apartment and half the cost.
Michael Yardney
METROPOLE PROPERTIES
Author of Australia’s leading property e-magazine.
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FREE subscription http://www.metropole.com.auThey had a reputation of poor quality and thinh walls and this hindered resale valuesHave rented in three central equity buidlings…Oldest building (built 1993) did have very thin walls…
However the last two which are 3 & 5 years old respectively I had no issues with noise….
Hi Feast,
I’m new to this forum but I thought I might have some first hand knowledge you’d appreciate. I own an apartment in City Tower that is currently getting 5% return. The average return I might expect for my apartment currently is actually closer to 4% but an associated company of Central Equity is MSSA (Melbourne Short Stay Apartments) and once you purchase they will offer a 5% rental for one year with options to extend. They in turn rent the apartments to short stay tennants (minimum one month), usually business types, and make their profit that way.
I have personally inspected the apartment, and they are a vast improvement on some of their previous developments.
Having said that, I beleive there are better opportunities elsewhere in Melb, but I know being in London can limit your options somewhat.
If you have any other questions, feel free to mail/message me.
GOSH!!!!!
I’m really surprised at the replies from everyone…
Turns out my gut said don’t go near and I didn’t attend the seminar this weekend!
Thank you for getting answers to me so quickly! Well done GANG
feast
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