I own an IP in one of the "leafy" suburbs of Melbourne and have just completeda reno. on it to maximise my rental return. It seemed like the right time.
My builder has had two people come up to him (one a neighbour from next door and the other from across the road) and ask if he is the owner and wants to sell. He received one firm offer of $920K to pass onto me and another of "name your price". Neither went inside to look at the house. The value of this IP, though for me a lovely 1920s house, is in the land.In December 2006 I had a valuation done on this place by the ANZ bank who used an independent valuer who did a thorough (inside too) valuation and came up with $780K which I frankly thought was a bit low. My own "guestimate" had been between $820 and $840K.
Comparing my high "guestimate" and the $920K firm offer that's 9.75% in six months !!??
Not selling
Elka
Guys Guys
As Xenia has been pointing out……………………………………Adelaide, Adelaide, Adelaide. Take a look I'm in shock!!!!!!!!!!!!!!
Mikey P
I'm going to buy a few there and that's from a WA convert that's made a bit over the last decade in Perth.."There will be a rally in property in 2010 that will make 2003 look like a blip. But thats a whole other thread……"
Crashy,
I will be happy if you are 100% correct!I only joined today and this is my first ever post in PropertyInvesting.com.
Me and my wife are first home buyer (to live in as PPOR) in Sydney, and we looked to buy a place in Cherrybrook (northern region, nice area for families). You wouldn't believe it but in June at least 50% of all the stocks over the last 2 years were snapped up in one month! Unbelievable. By the time we go inspection over the weekend everything was under offer. So by mid July we looked enough and know that the supply is very few (most people who lived in Cherrybrook does not want to leave).
So we ended up buying a 4-bedroom house (luckily) which for older ones (like 20 years old) goes for low 600K, but it was a dutch auction and we ended up paying mid 600s. It was available for 2 days, open inspection on one Saturday and we just literally made an offer (and 0.25% deposit) to them without even doing all those inspection reports etc etc etc. to lock in the contract.
Now I looked at it and everything is beginning to go into 700Ks. I cannot believe it, especially my settlement date is yet to arrive.
Hi I'm from Perth and I am finding that the FHOG has had very little impact on the housing market. I am currently looking at units/flats to do a quick reno and put back on the market. Currently vendors still think the boom is happening and the prices are currently not reflecting the market situation. So I am waiting patiently and currently looking at various mining towns where I have lived and bought houses before.
Have just purchased a reno, subdivision in Geraldton which is currently much more affordable than Perth and is surrounded by numerous mines. Friends that live there (sparkys etc) are flat out with work and are turning jobs down, which is always a good sign unless you are trying to build ha ha.
Thanks to everyone that has posted info on their towns it helps when you want to expand your search for property. Good luck and remember there is always another deal waiting for you, just turn left.
Ros
Hi All,
I read this topic with interest. Just yesterday, another financial planning mate & I were having this debate with a real estate agent mate of ours. He was making all the same broad statements as Steve – "the property market is heating up", "prices are heading higher" and "buyers are starting to become a little irrational". (But then again, when was the last time you heard a property spruiker say it wasn't a good time to buy property??
Anyway, we showed our mate the Reserve Bank and ABS websites….wouldn't you know it, there is actual data there that you can use to make sensible conslusions about what's gone on (& what might be going on in the future) in a range of markets – property, shares, and so on.
I think we agreed to disagree in the end. I'm sure our mate will still be telling prospective buyers on Monday to "act now" so as not to miss out on "rare properties, the last of their kind at these prices", yada yada…….
…….Hello all, Handy Andy is from Miles, a small rural town 4 hrs drive west of Brisbane with pop. of 1500 people. The current market here is "interesting".
Not many houses for sale, but what there is available, are now way over priced ($200,000+ for this area) and the only RE Agent is happy not to sell…last time he did this, we had a "mini-boom" here and I think another one will happen here again. I gambled the first time and was lucky, gained 100% increase in value in just 2 years…..
Hi All
I'm from Bundaberg in Queensland, In speaking to my local realestate agent today they have sold in the last 2 weeks what they normally sell in a month. She indicated things are still crazy even after the interest rate rise.
With the consumer debt levels showing little signs of decreasing, and with the latest rate rise (and more to come this year apparently) together with the looming tightening of credit due to what's happened over here in the USA, I think the ability to get finance and affordability will take another hit. Maybe full blown by mid next year. This will really affect the first home buyers and the average family the most.
This could mean that the current mini-surge might end, and the surge we are experiencing seems to be more the established housing market and the higher-end where people are more cashed up and have a healthier financial position. This is a small percentage of the population as a whole.
I think the slow down will be generally across the board, but more the middle and lower end of the price range. Good times for cashed up investors to buy properties cheaper I expect.
What heats up in one area goes cold in another … when an area goes out of flavor buyers are harder to find … I think John Howard and Peter Costello are a little nervous at present.
If we look at the majority of the population and not the sophisticated investors on this site … i think u will see lots of over capitalized mum and dads with 100% home loans and interest free store accounts and credit card problems packing beath … but lets and see …
Yes of course prices are rising and supply and demand will alsways be there
D
With 42,000 new jobs being created in Queensland last year. And, with no apparent slow down,…… would that not convince anyone with a bit of common sense, that supply of houses cannot meet demand. This includes rental, as well as owner occupier housing. The same in Melbourne, albeit a lower figure. Sydney also has a chronic shortage of new housing, and increasingly the type of housing needed. Demographics have changed, making 1 bed/2bed units/apartments/townhouses in huge demand. Immigration is about to be increased in the coming years. Most of these people, (I hope!!?, have read), are qualified professionals, who will be looking for quality housing. They have to live somewhere. Also Australia is a great place to live, and will be in demand by the rest of the world, as a very desirable place to live, for generations to come. As supply cannot as yet meet demand, this will keep driving housing prices up.So rest assured, that corrections, not crashes have been, and will be the order of the day. The world's economies of today are far more fluid and dynamic, than those of the 30's to the 80's. The fundamentals are very strong in the Australian economy, and will remain so under a change of Government. Rudd, if he gets in, will drop a lot of the dogma he has been sprouting, and tow the Howard economic line. After all, it was Hawke, who altered the structure of the economy, to bring it into modern times.
The message is, for serious property investors, buy as best you can, in the best possible areas, but do it for the long term, and add to it when you can. For aggressive investors, they will ramp it up always, and go for it. Some will do well, others will blow it. It all depends on the individual, and his/her mindset.Personal debt levels are high, yes! But,.. employment is strong, and gaining strength. The majority of Australians own their own homes. Affordability is not really the major issue that the media is banging on about. It is always wise to view the popular medias take on the economy, (and everything else) with a degree of scepticism. And if China implodes, like many informed economists think, then the Govt, can start digging uranium as fast as possible to make up for the shortfall in taxes from the mining sector. Yes sir re bob, we sure are 'The Lucky country'
Brisbane
Buy and Hold slightly negative for me I make my cash flow at work and enjoy it.
Ashgrove just got a bank valuation on my IP showing large jump this is a very recent jump as I am always ripping the equity out of it, its nearly as much as I wrote on the form as my estimate and I thought that I had whacked an extra 50k on that!!
Hawthorn friend bought 14 months ago small house on 400m on top of hill for 1.05M bank valuation`last week 1.4M
Bulimba bought my own PPR uniterupted city views on a hill contract signed early Jan 07 (not telling price) have been offered 300k plus but I aint selling
Forest Lake just missed out on a 4 bedroom house and land package for 290k in new estate just gone to contract on a 4bdr H&L package 350k second last block left on new but developed estate, residex reckon 14% for next 5 then 13%`for next 3 (dont know why but they seem to be good at predictions), have a look on real estate .com see how quick they are selling there 1 hour sometimes
Looked at Springfield Lake very nice things moving along, not on residex so gave it a miss, might revisist this one as it is quite a nice long term prospect
Murarrie offered a private sale 350k with views, treasurer said no, it sold through an agent 2 months later June 440k its on terry ryders list as super performer whatever that is, I work there its so close to the city, the airport, rail, gateway bridge duplication median house price in Bulimba 3km's away are $820k
New estate at Waterford very secluded spectacular views half way between gold coast and Brisbane selling fast good blocks already sold, this is dragging prices up in the not so desirable adajcent houses its not on residex so gave it a miss
Sippy downs friends buying there solid fundamentals lots of land flips happening right now
What is very encouraging is the bank valuations for refi are coming in higher than expected and as you know they are normally conservative
Perth
I am no expert but watch the local market like a hawk. Prices here boomed recently as I’m sure you are all aware. I live in Connolly which is about 25km north of the CBD. My house has increased from $490k to $750k in less than 18 months.
However, the market does seem to have stabilised. There are a lot of houses on the market and a few starting to offer slight reductions. Houses are still selling in the popular areas. A familiar story to me as I sat through the same market trend in the UK, a boom and then a flattening off period. Its funny to hear the same comments “It cant carry on this way, where will it end”. I occasionally look at the prices in my old UK town and the trend is still upwards but at a much slower rate.
Looks like its time to sell up and move to Melbourne and start that investment portfolio I keep dreaming about.
Property Market heating up??
A friend of mine just bought a 900m/2 block of land in Turramurra, new sub division for $630k – it sold 6 months ago for $685k and they spent 30k getting plans approved … where is the market heating up …
Interest rates are rising and "fear" is in the market still – there are deals out there as above … go figure … so market heating up as advised by Steve … not in my opinion yet.
D
wealth4life.com wrote:Property Market heating up??A friend of mine just bought a 900m/2 block of land in Turramurra, new sub division for $630k – it sold 6 months ago for $685k and they spent 30k getting plans approved … where is the market heating up …
Interest rates are rising and "fear" is in the market still – there are deals out there as above … go figure … so market heating up as advised by Steve … not in my opinion yet.
D
I love Sydney….$685k for a block of dirt, sounds like a market that has heated up to me ….. I feel relieved to have gotten out of Sin City many years ago.
Yes sin city will come back mark my words … Qld hot now but so was Perth now they are crying … Melb, yes OK only because the prices are cheaper than other parts of the country … QLD, go ask the locals and the deals are in 12month old property that were bought from marketing companies with 50k commission in … the deals are there and markets always correct …
Regards Ned Kelly
Hey Ned, Don't forget Brisbane is only just started moving again after a relatively flat period (correction) since 03 unlike Perth which is coming of the top.
Perth people aren't crying – most started investing in Bris,Melb Adelaide in the past 12 months.
We're all still smiling.millions wrote:Perth people aren't crying – most started investing in Bris,Melb Adelaide in the past 12 months. We're all still smiling.So what have you been buying;
houses?, units?, subdivs? – neg geared, pos geared?
What has happened to those investments in 12 months and what was your plan when you bought them?
If they are neg geared, has the cap growth kept pace or outpaced the shortfall?Hi Marc, I purchase for growth. All neg geared. Capital growth has hugely outpaced the shortfall. My LVR is 33%.
My original plan was to purchase high growth properties and develop. Then I realised how much work was involved, risk, and financial constraints. Unless you are doing a small project you will have to either do a JV or sell some of your properties off the plan. When you make a huge profit the govt takes a huge chunk of it and you've done all the hard work and risk. I decided it's probably better off to purchase already developed properties with high cash flow (and great tax incentives and growth) and never sell – hence no tax, and less grey hair.
I borrow 110% and don't purchase unless I'm convinced the property will grow in value by more than what I have borrowed very quickly. I target areas that may not be hugely popular but has to have heaps going for it.
Prop 1 9ks Perth, 1 street from river 1586sqm block triplex
Prop 2 11ks Perth 1 street from river, 1 of best state schools in suburb duplex block 780sqm
Prop 3 11ks Perth 1 of best private schools. 816sqm block huge 5×2 house, best street
Prop 4 30ks Bris – townhouse, views river, Bris, gone up by 40k in 3 months
If I subdived 1st 2 properties they would be worth heaps more and the rent is jumping up by about $75/wk every year. By next year all of porfolio should be neutral. Prop 3 is my PPOR with very small morgage. Linda
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