New Apartment near Toorak Rd & Chapel Street

That is a big price tag. What are the attractive features of the apartment? What's the expected rent? Avoid buying something with a 'rental guarantee'! Beware also a possible glut of apartments coming onto the scene over the next couple of years…your apartment could very well be worth less than $646K at completion.

2) what are the chances of the land next door being developed to the same height blocking out your view?

3) what is the current rent for a similar 2 bedroom unit in south yarra?

4) what are units in the area selling for at present? how does this compare to the one you are looking at (features, size, location, bedrooms etc). You can order a report from RP Data or APM etc to find out how much properties are selling for in the area.

5) Capital gains will be limited for 5+ years due to having to combat high depreciation and developer's margins built into the price – unless you have bought at the bottom of the market or early in the cycle, then the chance of a stag profit or selling at a gain in the short term will be limited.  (Hint, look for a block of units built 5 or so years ago, get a property report which shows original purchase  costs and resales – if you compare the resale on the unit you can form a view on how long you may need to hold the property taking into account the property cycle when the unit was originally contracted for sale (if off the plan) and when it resold.

At first glance the property looks to be in a good location: close to transport (tram and trains), parks, restaurants. However that goes for the hundreds of other apartments in that area. I'd be very cautious about buying brand new apartments in Melbourne if I were you. Granted, new properties offer superior depreciation benefits in the first number of years, however in the first place they are likely to be overpriced. For an agent to tell you its 'underpriced' already rings alarm bells to stay away. Why in the world would a developer knowingly sell something for less than its worth? Most of the time, everything sells for exactly what its worth based on current market conditions, or otherwise above what its worth.

$600+K is a heck of a lot of money. I strongly advise you to have a look at the prices of comparable properties in the area that have actually sold in order to gain a better understanding of whether it's worth the price or not. Frankly speaking, if you want to look at brand new stuff, I'd rather be looking at a brand-new townhouse in someplace like the inner-west, or otherwise compromise and buy something that is well located or a recently renovated small 2 bedder in places like Yarraville, Footscray…

Or you could head out East and look at the outer suburbs, picking up a solid 3-4 bedder on a massive block of land with subdivision potential for $500-550K or so and save having to borrow another $140K. I think you really need to ask yourself why you want to buy THIS particular property and why you prefer to buy an apartment over buying something 'landed', like a detached house, terrace, townhouse or villa unit. There's so many things to consider here we could write a book on it.